Archive for the ‘Textiles & Clothing’ Category

Review of assistance to Australian textiles, clothing & footwear industry

September 22, 2008

The review by the Taskforceinto the textiles, footwear and clothing industry was handed to the Minister by Professor Roy Green in late August.

 

The AFR ran a front page article on the likely thrust of the report. Judging from the word around the Canberra traps, the AFR article is pretty close to what the feds will finally decide. In brief:

 

§          The tariff reduction to 5% will happen (no big deal – tariff assistance can be swamped by currency fluctuations)

§          Programs to be introduced for workforce and management capabilities, R&D support, adoption of new business models, links to global supply chains (aligns with new Enterprise Connect Program)

§          Building competitive advantage through uniqueness, design, innovation, speed to market etc.

§          Emphasis on fashion and design, which was largely missing from the Button TCF Plan (no-brainer – opportunity to leverage off Melbourne’s longstanding capability, and to link with Milan etc.)

§          Prof. Green said ‘we should be giving as much attention to where value is created as to where assembly is situated’ (totally agree – owners of Quiksilver, Rip Curl and Billabong are sipping wine at Jan Juc and the Gold Coast as you read this)

§          Renewed emphasis on value-adding the wool industry (yes – bring the farmers in from the cold).

 

Some very interesting agendas are about to unfold in TCF. However the Government is not well-equipped to put together international joint ventures due to the demise of Invest Australia.  

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The Hot Goss on federal programs (as at August 2008)

August 26, 2008

 

Many programs on hold – numerous program reviews underway – fascinating under-currents emerging.  

 

Cutler Review of Innovation Programs – Dr. Cutler’s group and its secretariat are currently mulling over 700+ submissions. The Green Paper was expected end July, but the date has been put back. Issues that might get a run are smarter use of government procurement; and clustering and milieu themes.

O’Kane Review of Cooperative Research Centre Program – report released 5 August. Key recommendations are:

§          A focus on funding large end-user driven collaborative pre-competitive research.

§          Each CRC should be of high national benefit with significant spillovers.

§          A new program be established to assist industry and other end-user groups to undertake strategic analysis or innovation mapping projects and to establish collaborative ventures between end-users and researchers, including publicly funded research institutions. (THIS IS SIGNIFICANT)

§          Priority for new collaborations in areas with little history of collaborative activity or a low R&D base, particularly service industries and those sectors populated by SMEs. (ALSO SIGNICANT)

§          (Shadow Minister Eric Abetz put out a press release criticizing the Government for being 5 days late in releasing the report. You can do better than that, Eric!)

Green Review of TCF support – understood to be on-track. Cockatoo hopes that it will focus on 1. keeping the local industry tracking to higher value activities that complement the market position of low-cost competitors; 2. strengthening of global supply chains; 3. integration of design into quality apparel fashion goods; 4. increased local processing of natural fibres.

Creative Industries Innovation Centre ($16.2 million) – submissions have closed. RMIT/QUT consortium was seen as the front-runner due to its initial involvement in lobbying for such a centre. But the submission process has triggered much activity from other players, and some excellent concepts. Cockatoo trusts that a collaborative framework emerges that can accommodate as many cities as possible.

 

Clean Energy Innovation Centre ($20 million) – submissions have closed. This centre could be significant if it captures the latent opportunities. The industry is defined as solar; wind; geothermal; biofuels; fuel cells; hydro (latter is marginal). It must focus on the links between research, SMEs and the big corporates.

Innovative Regions Innovation Centre ($20 million) – HQ to be in Geelong (Deakin University), but to involve 4 other regions. The centre will provide expert advice re strengths & weaknesses, strategic business issues etc.; provide grants for company improvement; help to find latest research, technology & organisational knowledge; provide specialist facilities & advice to turn ideas into products; facilitate access to other companies offering mentoring, private investment, partnerships.

The selection criteria for the other 4 regions are (i) higher than average unemployment and (ii) experiencing adjustment pressures. Cockatoo figures that if you follow these criteria, the old chestnuts of northern Adelaide, Gippsland, northern Tasmania etc. will emerge. We trust that there is scope for this Centre to reach out to those regions willing to chase best practice outcomes. The launch is very soon (21 August?).

 

Regional Development Australia – the RDA Committees (the old ACCs) are currently providing comments on new admin arrangements and local infrastructure requirements. The new program will be valuable if it can be integrated with the big ticket agendas of Infrastructure Australia. The feedback we are getting is that the current 12 month funding hiatus is creating major expectations for a major program as from next July. These expectations are being further fed by the consultation process. Also, the rural regions see their issues as quite different from those of the metro regions. There is a concern that the roll-out of Infrastructure Australia and the Building Australia Fund ($20 billion) will mostly favour the cities.

 

House of Reps Enquiry on a new regional infrastructure program – submissions closed 14 July. Cockatoo made a submission pleading for Ministers to keep out of the process, and for the feds to stop its piecemeal approach. Watch this space. The outcomes of this enquiry will somehow merge with those of the RDA arrangements above.

 

Federal program updates – Australia

July 24, 2008

 

Things are quiet because many programs have temporarily disappeared. Numerous program reviews at present.

 

Cutler Review of Innovation Programs – they are currently mulling over hundreds of submissions. The  Green Paper is expected end July. Three issues that might get a run are 1. smarter use of government procurement; 2. another shake-up of the CRCs; and 3. clustering and milieu themes.

 

Green Review of TCF support – understood to be on-track. Cockatoo hopes that it will focus on 1. keeping the local industry tracking to higher value activities that complement the market position of low-cost competitors; 2. strengthening of global supply chains; 3. integration of design into quality apparel fashion goods; 4. increased local processing of natural fibres.

 

Creative Industries Innovation Centre ($16.2 million) – submissions have just closed. This Centre has the potential to trigger a lot of smart activity. Decision likely in August, although we hope it is not rushed.

 

Clean Energy Innovation Centre ($20 million) – submissions due 21 July. This centre could be very significant if it captures the latent opportunities. The industry is defined as solar; wind; geothermal; biofuels; fuel cells; hydro (latter is marginal). We believe it must focus on the links between research, SMEs and the big corporates.

 

Regional Development Australia – the RDA Committees (the old ACCs) are currently providing comments on new admin arrangements and local infrastructure requirements. This could be valuable if it can be somehow integrated with the big ticket agendas of Infrastructure Australia.

 

House of Reps Enquiry on a new regional infrastructure program – submissions close 14 July. Cockatoo is making a submission pleading for Ministers to keep out of the process, and for the feds to stop its piecemeal approach. Watch this space. 

Kim Carr’s innovation agenda

April 13, 2008

Federal Industry Minister, Kim Carr addressed the Annual Industry Leaders’ Dinner in Geelong in late March. It was significant at three levels. Excerpts below.

Commitment to manufacturing “Do I support manufacturing? You bet. – Do I think it’s vital to the Australian economy and Australia society? Absolutely – Do I think governments should create an environment in which manufacturing can flourish? No question. When Kevin Rudd said he wanted Australia to remain “a country that actually makes things”, I cheered.

“…We remain firmly and unapologetically committed to securing the future of manufacturing…the slightly more challenging news is that the government can’t support manufacturing at any cost, or on any terms…the quid pro quo for our support is that manufacturers must be ready to innovate and export…and prepared to invest in local know-how to create their own competitive advantage.”

Status of reviews underway The 4 reviews are National Innovation System (chaired – Dr Terry Cutler); Cooperative Research Centres program (chair – Professor Mary O’Kane (part of the innovation review); Automotive Industry (Steve Bracks); Textiles, Clothing & Footwear Industries (Professor Roy Green).

The Cutler review will help us understand the connections between the different elements of our national innovation system. The automotive and TCF reviews will show what innovation can do for industry. The NIS and CRC reviews will show what industry can do for innovation. We need to connect sectors, institutions and individuals to promote collaboration and knowledge transfer.’ (Cockatoo is about connectivity – we will be making submissions. See innovation.gov.au)

Enterprise Connect program $200 million initiative to give SMEs better access to new ideas, know-how and technologies. To create a network of knowledge-creation and knowledge-transfer sites. Main elements:

§ 5 new manufacturing centres – Sydney, Melbourne, Adelaide, Perth, Burnie, plus existing QMI Solutions base.

§ 5 dedicated innovation centres – Creative Industries; Clean Energy; Remote Enterprise (Alice Springs); Mining Technology (Mackay) Innovative Regions (Geelong). First two have not been decided.

§ $10 million Researchers in Business scheme – for placement of university and public researchers in businesses.

EC ‘Lead Markets Initiative’ – procurement and standards to assist industry!

January 17, 2008

Verrry interesting! The European Commission is proposing to unlock market potential in a first batch of six important markets – eHealth, protective textiles, sustainable construction, recycling, bio-based products and renewable energies.

These EU markets have a turnover of more than € 120 billion and 1.9 million jobs. The initiative aims to grow turnover to € 300 billion and 3 million jobs by 2020.

The “Lead Markets Initiative for Europe” (LMI) will foster the emergence of these markets by improving legislation, encouraging public procurement and developing interoperable standards. European enterprises will profit from fair and better chances of entering new fast growing world-wide markets with a competitive advantage as lead producers. LMI would also bring visible advantage for Europe’s consumers.

An EC spokesman said: “Europe must develop innovation friendly markets in a more targeted way, creating conditions to facilitate the marketing of innovative products and services. The LMI has identified promising emerging markets in which the European Union has the potential to become world leader and where coordinated action is urgently needed“.

The LMI initiative calls for the urgent coordination of policies through ambitious action plans:

§          eHealth: ICT solutions for patients, medical services and payment institutions. Standardisation, for instance of various information exchange formats, certifications of systems and large-scale demonstration projects will help to cope better with the arising problems from an “ageing” Europe.

§          Sustainable construction: Buildings account for the largest share of the total EU final energy consumption (42%) and produce about 35% of all greenhouse emissions, so developing sustainable solutions is crucial. Orientation towards innovative solutions and cutting administrative burdens are some of the proposed measures.

§          Technical textiles for intelligent personal protective clothing and equipment (PPE): The current PPE market in the EU is estimated at 10 billion euros. Spill-over effects from faster growing innovations in PPE to other market segments of the textile sector would considerably increase the economic impact of the lead market and the competitiveness of the entire textile sector. §          Innovative use of bio-based products: Europe is currently well placed in this market, building on established knowledge and a leading technological and industrial position. Perceived uncertainty about product properties and weak market transparency however hinder the fast take-up of products. Communication, standardisation, labelling and certification will be addressed.

§          Recycling: This sector has a turnover of € 24 billion and employs 500,000. There is significant market potential, but barriers to market development need to be addressed.  

§          Renewable energy: This sector is held back by high costs, low demand, market fragmentation and administrative and market barriers. A flexible market-based European framework should ensure that 20% of energy demand will be met by renewables. Accelerating innovation in low carbon technologies and removal of planning and certification barriers are crucial.

The initiative has sparked our interest at three levels.

§         
It focuses on a ‘competitive, demand-driven approach’ and avoids ‘picking winners’. The EC states that it will avoid favouring specific companies. But surely it has just picked six industries! These are the first batch. What is in the next batch?

§          The EC will use public procurement and standards to support these industries. We note EC’s track record in this field, especially the flouting of international procurement protocols and using standards as a competitive weapon.

§          Will the EC’s powerful subsidies regime be aligned with these industries?   For background, go to http://ec.europa.eu/enterprise/leadmarket/leadmarket.htm

Euro view of NZ innovation system

October 17, 2007

 Henri Janssens, senior project manager with Oost NV, in the Netherlands, has kindly alerted us to a CORDIS News report on developments in NZ.

The reasons for pursuing international collaboration within NZ’s research community vary from a desire to be at the cutting edge to a need to secure human resources, funding and access to equipment. Whatever their reasons, there is no doubting the interest within NZ in increasing links with European researchers, as CORDIS News discovered on a recent visit to the country.

  Many NZ researchers already have links with Europe at both an individual and institutional basis – now a growing desire by researchers and the NZ government to increase these linkages.

 ‘If we want to be world class and cutting edge, we have to get out there and show the flag,’ (Dr Murray Mitchell, National Research Centre for Growth & Development.)

‘It means doubling our output for half the price…international collaboration would halve the time it takes to get products to the market. We don’t necessarily need the money, just the
commitment to work on joint projects,’ Dr Alison Stewart, Centre for Advanced Bio-Protection Technologies.

NZ Research, Science & Technology Ministry’s strategy for increasing international research linkages includes involvement in the EU’s Sixth Framework Program (FP6) and positioning for FP7.

Some are put off by a perceived complexity and lack of willingness within Europe to open up to the world, but others have joined consortia submitting proposals.

Canesis, New Zealand‘s largest wool and textiles research company, has been working with a Spanish research institute on the application of lipids, extracted from sheep wool, to human skin in a cosmetic form. Another area of interest for collaboration is biopolymers. 

The Research Institute for Hort Research that is flying the flag for the project, EuropRevall, is due to commence in June 2005 and will investigate the prevalence, cost and basis of food allergies across Europe. It will also seek to develop holistic approaches for their prevention. HortResearch started out as an associated partner, but was invited to become a full project participant at the initiative of the European Commission after the proposal had been evaluated.
 

 NZ has its Centres of Research Excellence (CoREs) – that are very suited to collaboration with the EC e.g. Centre for Advanced Bio-Protection Technologies. There are six other CoREs: Allan Wilson Centre for Molecular Ecology & Evolution; Centre for Molecular Biodiscovery; MacDiarmid Institute for Advanced Materials & Nanotechnology; NZ Institute of Mathematics & its Applications; National Centre for Growth & Development; National Institute of Research Excellence for Maori Development & Advancement.
 

The CoREs have acted as a catalyst for increased collaboration. ‘It never occurred to me that we may have something in common with some of the other groups. It was quite a revelation to me. One of the most positive things to come out of this is to have people think more widely and to bring people together.’ Prof. Ted Baker, management committee of the molecular biodiscovery CoRE.
 

Visit http://www.morst.govt.nz

Ashoka social entrepreneurs

October 17, 2007

One of the most effective promoters of social entrepreneurs in the USA is Ashoka.

Founded in 1980, it makes small investments in social entrepreneurs who are engaged in promoting positive social change. Much like a venture capital firm, Ashoka invests in well-qualified and committed individuals (or teams) who then promote positive social innovations.

Ashoka has invested in 1,500 fellows in 53 countries. Its latest innovation is a new Global Fellows program that supports social entrepreneurs who are doing work that has a positive global impact. The first three Ashoka Global Fellows are:
§          Ron Layton, a New Zealander who works with native peoples to shift control of licenses, patents, intellectual property etc. back to the producers of goods like textiles and coffee.
§          Karen Tse, an advocate for criminal justice reforms who has successfully modified such systems in Cambodia, China, and Vietnam.
§          Orri Vigfusson, who is leading a major citizen-based campaign to save the wild Atlantic salmon.

See http://www.ashoka.org/global/aw_globalfellows.cfm

Mauritius – from hungry and hopeless, to a success story

October 16, 2007

A recent IMF working paper (Etienne B. Yehoue) regarding a Brazilian footwear cluster also provided interesting insights on Mauritius. Paraphrasing follows.  

Why, given two countries with almost the same level of risk, does one attract clusters of foreign investment, while the other fails? Mauritius and Senegal are both former French colonies, which benefit from preferential arrangements with the EEC under the Lome conventions.

Both initially engaged in the same type of policy reforms and established export processing zones (EPZs). Both are poor but not landlocked. Senegal has a comparative advantage from its larger size, greater amount of arable land, and has a higher population.  Yet it was Mauritius that managed to attract considerable foreign investment, to become one of the few African countries with relatively high per capita income. It has transformed itself from a hungry, hopeless nation to one of the impressive success stories in the postcolonial era.

Senegal has not achieved this.  Some say that the geographical location of Mauritius is the key determinant of its success, but islands such as Seychelles or Comoros in the same region have not achieved Mauritius’s results.   

Mauritius (population less than 2 million) successfully moved from a mono-crop culture (sugar) to one diversified into manufactured exports and tourism. The agricultural sector now accounts for only 10% of GDP – manufacturing accounts for 29% and services for 61%. The success of the manufacturing sector has critically depended of the establishment of EPZs in 1970. Eleven EPZs were already in operation in Sub-Saharan Africa (e.g. Ghana, Liberia, Senegal and Togo) but have not been as successful as Mauritius.   

The answer didn’t lie in political instabilities, since Ghana and Senegal have been as politically stable. At the core of the Mauritius success was its government, which provided the support institutions and a dynamic entrepreneurial class. The trigger was the 20-fold surge in sugar prices from 1970 to 1974, which led to a record sugar production and a markedly improved balance of payments situation. This helped overall investment, and domestic entrepreneurs clustered their investment mostly in the textiles sector.

Combined with aggressive marketing of EPZs, it led to impressive FDI inflows. A campaign was launched to attract FDI from Europe and Southeast Asia. The Mauritius Export Development & Investment Authority promoted Mauritius as a base for complementary services or externalities necessary for the manufacturing industries.

Consequently, Mauritius’s GDP per capita (current prices) rose from US$270 in 1970 to US$3,640 in 1997.  To summarize, the interplay of government leadership (via incentives and institutions) and the dynamism of domestic entrepreneurs provided positive externalities for the clustering of foreign investment, which further stimulated FDI. This interplay seems to have not been present in many other African countries.

European industry sector analyses uncovered!

October 16, 2007

We have stumbled onto a series of very useful European industry analyses, thanks to the INSME newsletter. The analyses have been undertaken on behalf of Europe Innova.  

The industries covered are aerospace, automotive, biotechnology, chemicals, eco-industries, energy production, food, gazelles, ICT, machinery and equipment, textiles.

The analyses address a whole range of issues, such as the degree of (international) competition, forward and backward linkages with other industries, specialization patterns, sectoral innovation systems, patterns of innovation, new technology paradigms, demand for skilled labour. 

Download the reports at: http://www.europe-innova.org/

Valencia – more than oranges

October 16, 2007

I returned in late 2006 from participation as an external consultant in an OECD experts group advising the Greater Valencia Region on investment attraction, internationalisation and innovation. 

This was a case study of a series of reviews undertaken by the OECD Programme on Local Economic and Employment Development (LEED).  The project aims at providing policy recommendations to the city governments, its economic development agency and their partners on how to develop an FDI and internationalisation strategy for the city. A final OECD report will be published early next year.

Valencia, south-east of Madrid, is the third largest city in Spain. It has a long tradition of academic excellence, a very substantial manufacturing base (transport equipment, textiles and clothing, ceramics, food, toys), strong lifestyle attributes, and serves as a major transport logistics hub into Europe.

Our discussions revealed concern within Valencia about competing with imports from China and India, the lack of connectivity between the research community and industry, ‘branch plant’ multinationals, and water availability.

These are issues in which certain regions in Australia have some experience, and Adelaide and Perth in particular have a window to collaborate with Valencia, being cities of similar size and located in a mediterranean climate. Valencia is also host to the 2007 Americas Cup – hence another link to Perth. We would be interested in hearing of agencies wishing to be briefed further on this.    

Further information on the LEED Programme and its activities can be found at: www.oecd.org/cfe/LEED