Textile Industry in Developing Countries

Experienced and researched in Indonesia

Video

http://nos.nl/video/476479-banen-indonesie-op-de-toch

Main Question

What are the consequences of the textile industry

on the development of the society of developing
countries, looking from economic, social and
environmental perspective?

Strategies of development
Communism
Import Substition
Export Oriented Industrialisation
Only the latter succeeded as seen in the NICs.

Example Singapore
1950

2011

HDI:0.500

HDI:0.501

Singapore

Bangladesh

Russia Brazil
1950

HDI: 0.695
Russia

1950

HDI:0.448
Brazil

2011

HDI: 0.866

HDI:0.755

Singapore

Russia

HDI:0.718
Brazil

High Income Country

2011

HDI:0.910
Netherlands

The Flying Geese Paradigm

Describes development
Stages:
Import rises
Production rises
Production > National Demand = Export
Production falls
Import rises

time

Amount in currency

Counter arguments
Higher incomes is a natural proces
A shift towards more capital intensive industries

Case Study
In Indonesia the Dutch started mass-producing
textile
Textile Hubs: Bandung, Jakarta, Pekalongan,
Semarang

Map of Java

Bandung Textile Hub

How is textile produced

Filmpke

Push/pull factors
Push Factors
High living costs in large cities
Factory raids by police

Pull factors
Formal work
Income security
Social security

Closer to home/family

How much did our Polos cost?

Costs for 1 shirt
Labour 4500 IDR (3 labourers)
Electricity 500 IDR
Yarn 1000 IDR
Textile (cotton) 30,000 IDR
Collar 4000 IDR
Buttons 6000 IDR
Embroidery 5000 IDR
Finishing (pressing) 2000IDR
---------------------------------------------------------------------------- total costs
53,000 IDR
---------------------------------------------------------------------------- Sells for
65,000 IDR
---------------------------------------------------------------------------- profit
12,000 IDR

Suppose 30% increase labour costs with current productivity levels.

New total labour cost per piece=5850
Costs for 1 shirt
Labour 5850 IDR (3 labourers/per piece)
Electricity 500 IDR
Yarn 1000 IDR
Textile (cotton) 30,000 IDR
Collar 4000 IDR
Buttons 6000 IDR
Embroidery 5000 IDR
Finishing (pressing) 2000IDR
---------------------------------------------------------------------------- total costs
54,350 IDR
---------------------------------------------------------------------------- Sells for
65,000 IDR
---------------------------------------------------------------------------- profit
10650 IDR
Percentual change profit 10650-12000/12000 *100=-11.25%

Maintaining current profit level

X-54350=12,000
X=66350
This amounts to a percentage increase of
66350-65000/65000 * 100= 2,07%

Dutch cost scheme

Costs for 1 shirt
Labour IDR (3 labourers) 1469.40 * 12157.37/500 * 3 = 107184 IDR
Electricity 500 IDR
Yarn 1000 IDR
Textile (cotton) 30,000 IDR
Collar 4000 IDR
Buttons 6000 IDR
Embroidery 5000 IDR
Finishing (pressing) 2000IDR
---------------------------------------------------------------------------- total costs
155684.23 IDR
---------------------------------------------------------------------------- Sells for
167684.23 IDR
---------------------------------------------------------------------------- profit
12,000 IDR

Pollution
Main problem: wastewater
Accelerators
Consumerism
Lack of awarness, motivation, tools to enforce laws

Biochemical Oxygen Demand

Measurement of wastewater quality
434 mg/L is BOD for cotton
Untreated sewage water: 600 mg/L
Cotton processing (ton of
cotton)
Average compounded
Process-specific
Yarn sizing
Desizing
Kiering
Bleaching
Dying
Printing

Waste Volume
(m3/U)
265

BOD
(kg/U)
115

4.2
22
100
100
50
14

2.8
58
53
8
60
54

Wastewater comparison
Global cotton production 22.3 million tons
5,9 billion m3 wastewater
Groundwater consumption of NL 1 billion m3

Conclusion