The Philippines garments industry is running out of decent factories to manufacture apparel as several orders originally meant for China have been diverted to the country due to the US-China trade war, according to the Foreign Buyers Association of the Philippines (FOBAP). It is tough to find factories for production, FOBAP President Robert Young said. The association has received non-stop inquiries from buyers in the past two months.
Though FOBAP expects garment exports to maintain last year’s level of $1.3 bn-$1.5 bn this year, Young said many garment manufacturers cannot meet the requirements of big companies on labour, good working conditions and waste management. Some 20 factories failed in just one audit, he said.
The compliant garment firms are located inside the economic zones but are few in number, according to a Philippine newspaper report. Chinese garment firms are now investing in Bataan as they bring in their orders to avoid the high tariff imposed by the United States. About 12 Chinese garment firms will rent factories in Bataan, he said. FOBAP used to import $3 bn worth of garments, furniture, giftware, bags. This has gone down to $1.3-$1.5 bn in the last year.