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Garment manufacturers in Turkey, Egypt suffer as buyers cancel orders

The Turkish and Egyptian garment manufacturing sectors, which employ millions of people, are left in a lurch as big brands have cancelled orders even of goods already produced and waiting to be dispatched. Up until March, around one million Egyptian and 1.5 million Turkish workers were busy spinning, dying, cutting and sewing garments for the summer season, which accounts for around half of annual sales. However soon COVID-19 started to sweep across Europe and North America and countries there went into lockdown mode with major brands and retailers going incommunicado.

Around 80 percent of Turkish factories closed in the first several weeks of the lockdown - - leaving the sector with over $2.5billion in ordered inventory and a further $1billion in orders in production, or already produced, that were cancelled until further notice, said Hadi Karasu, President of the Turkish Clothing Manufacturers’ Association. In Egypt too, manufacturers were left in the lurch by the buyers as buyers are refusing to accept orders of finished garments.

Around 60 percent of Egyptian exports are to the USA, the remainder to Europe. When the buyers did get in contact with manufacturers, they wanted to impose new terms and extend payment terms by 90 days to 180 days. Manufacturers and export associations have called for greater cooperation with buyers to hash out agreeable terms. Many of Egypt’s 7,000 garment and textiles factories are expected to go under this year if the situation continues. Egyptian exports of “white gold”, extra-long staple cotton acclaimed for being the best in the world, is also likely to be impacted.