Fashion, furniture exports to grow 2-3% in 2018

File pix.

KUALA LUMPUR: The Malaysia External Trade Development Corporation (MATRADE) expects fashion and furniture exports growth to slow to 2.0-3.0 per cent this year due to the US-China trade war.

Export Acceleration Deputy Chief Executive Officer Datuk Wan Latiff Wan Musa said exports of fashion products, comprising textiles, apparel and footwear increased 10.4 per cent year-on-year in 2017 to reach RM15.33 billion while exports for furniture rose 6.4 per cent to RM10.14 billion.

“We are now seeing stagnant growth in these areas due to the slowing of the global economy caused by the trade war,” he said at a press conference after his welcoming remarks at the “From Original Equipment Manufacturing to Original Design Manufacturing/Original Brand Manufacturing: The Perks and Challenges” seminar here today.

For the first nine months this year, exports of fashion amounted to RM11.21 billion while exports of furniture reached RM7.1 billion.

Wan Latiff said in order to maintain and accelerate these figure, there was a need for Malaysian companies to make bold moves in manufacturing their own brands.

“MATRADE urges Malaysian companies to move up the value chain by making efforts to diversify and innovate, in this case through original design manufacturing (ODM) or original brand manufacturing (OBM), to produce higher-value products and services for export.

“Investment in ODM and OBM will give (local) companies an avenue to secure a bigger share in the increasingly competitive global market through their own designs, marketing and brand management, instead of continuing to function as nothing more than an original equipment manufacturer.

He noted that moving up the value chain to become ODM and OBM would be expensive as it required a lot of research and development, however, consumers nowadays were willing to spend more for branded items because having a brand was usually associated with having quality.

Wan Latiff said incentives have been provided by government agencies to assist businesses in these areas, citing the example of SME Corp providing funding to help entrepreneurs develop their brands while MATRADE provided a market development grant.

“The grant is provided to assist companies to promote for their brands. They can claim up to RM15,000 for participation in international trade fairs and up to RM10,000 if they participate in our export acceleration missions,” he added - Bernama