Taiwan Textile Investment Patterns To enhance their competitiveness, Taiwan textile firms are continuing to invest elsewhere in Asia, especially in Mainland China, Thailand, Vietnam, Cambodia and Myanmar (Burma).
Prospects for the Taiwan Textile Sector The fate of firms remaining in Taiwan will depend on their ability to adapt to increasing competition.
Although the rate of adjustment is slowing as the number of weaker firms falls, companies with capacity remaining in Taiwan must diversify their markets and move up the value chain to high-end textiles and garments, performance fabrics, or branded products.
Trade and Stocks
Higher cotton prices in 2006/07 are forecast to reduce cotton imports and stocks. Cotton imports are forecast at 240 thousand tons, a reduction from estimated 2005/06 imports of
250 thousand tons.
This is a fall of more than 51,000 tons from 2004/05 imports when Taiwan buyers built up stocks in response to low cotton prices. Cotton ending stocks are forecast to fall to 65,000 tons in 2006/07 from an estimated 100,000 tons in 2004/05.
The two-year reduction in ending stocks, and the cotton import forecast, is highly sensitive to assumptions about prices, which were assumed to be slightly higher than current prices over the period.
Tariffs for Man-made versus Cotton Products:
After joining the WTO, Taiwan reduced its tariffs for cotton yarn and man-made spun yarn to 4 percent. The tariff for man-made fiber fell to 1.5 percent while the tariffs for cotton gray cloth and man-made gray cloth remained at 7.5 percent. Clothing is charged 12.5 percent.
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