With the confidence of international buyers in Nepal's ability to fulfill orders shaken by constant labor stirs and a bad industrial climate, the export of Nepali garments to the US shrank by a third during the first four months of 2008.
The data of the Garment Association - Nepal (GAN) shows that Nepali readymade garment manufacturers exported a mere US$ 6.92 million worth of apparels to the US during this period. In the same period last year, exports amounted to US$ 10.29 million.
A month-wise breakdown of exports for this year reveals that shipments during January 2008 were up 2 percent compared to January 2007. However, exports declined by 14 percent in February, falling further in March and April by 66 and 49 percent respectively. In April, the value of readymade garment exports to the world's largest apparel market totaled a mere US$ 1.26 million, whereas in the same month last year, Nepal's exports amounted to US$ 2.48 million.
Exports spiraled downwards mainly after the tarai banda, which brought trade through tarai-based customs to a standstill for 16 days, said entrepreneurs. The banda prevented manufacturers from delivering their orders on time, making importers look elsewhere for their supplies, said entrepreneurs. GAN's data further shows that the export of the country's once largest exportable commodity has dwindled to one-eighth of what it was during 2003.
Nepal's readymade garment exports to the largest garment market had been floundering since 2002, when the US provided duty-free market access to Caribbean and Sub-Saharan countries - Nepal's main competitors for the American market.
While the phase-out of quotas in international apparel trading in 2005 landed another blow to the industry, political instability, labor stirs and falling competitiveness further weakened the base and drastically shrank the industry. GAN's year-wise export data reveals that Nepal's exports to the US plummeted 30 percent in 2004, 41 percent in 2005, 6 percent in 2006 and 48 percent in 2007.
As a result, the number of factories in operation has dropped to about a dozen from the more than 500 units that were humming fulltime a decade ago. This left some 80,000 people, half of them women, out of a job.
Entrepreneurs said that the industry could still bounce back if the political parties, the CPN-Maoist in particular, reined in their trade unions and asked them not to launch strikes in the manufacturing industry.
"Building a minimum understanding on a salary package and a no-strike commitment will instantly encourage entrepreneurs to reopen their factories, inject additional capital and bring back their international clients," said Uday Raj Pandey, vice president of GAN.
The data of the Garment Association - Nepal (GAN) shows that Nepali readymade garment manufacturers exported a mere US$ 6.92 million worth of apparels to the US during this period. In the same period last year, exports amounted to US$ 10.29 million.
A month-wise breakdown of exports for this year reveals that shipments during January 2008 were up 2 percent compared to January 2007. However, exports declined by 14 percent in February, falling further in March and April by 66 and 49 percent respectively. In April, the value of readymade garment exports to the world's largest apparel market totaled a mere US$ 1.26 million, whereas in the same month last year, Nepal's exports amounted to US$ 2.48 million.
Exports spiraled downwards mainly after the tarai banda, which brought trade through tarai-based customs to a standstill for 16 days, said entrepreneurs. The banda prevented manufacturers from delivering their orders on time, making importers look elsewhere for their supplies, said entrepreneurs. GAN's data further shows that the export of the country's once largest exportable commodity has dwindled to one-eighth of what it was during 2003.
Nepal's readymade garment exports to the largest garment market had been floundering since 2002, when the US provided duty-free market access to Caribbean and Sub-Saharan countries - Nepal's main competitors for the American market.
While the phase-out of quotas in international apparel trading in 2005 landed another blow to the industry, political instability, labor stirs and falling competitiveness further weakened the base and drastically shrank the industry. GAN's year-wise export data reveals that Nepal's exports to the US plummeted 30 percent in 2004, 41 percent in 2005, 6 percent in 2006 and 48 percent in 2007.
As a result, the number of factories in operation has dropped to about a dozen from the more than 500 units that were humming fulltime a decade ago. This left some 80,000 people, half of them women, out of a job.
Entrepreneurs said that the industry could still bounce back if the political parties, the CPN-Maoist in particular, reined in their trade unions and asked them not to launch strikes in the manufacturing industry.
"Building a minimum understanding on a salary package and a no-strike commitment will instantly encourage entrepreneurs to reopen their factories, inject additional capital and bring back their international clients," said Uday Raj Pandey, vice president of GAN.
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