The textile and clothing sector in Peru has great potential, but the difficult economic environment in major markets, fall in the exchange rate, and growing labour costs are impeding their exports, according to Asociación de Exportadores (ADEX or Association of Exproters). The situation calls for doubling of efforts to ensure growth of the textile and apparel sector, ADEX said in a statement. The association's president Varilias Juan Velasquez said the progress in increasing the country's cotton output has been minimal in spite of the Government's S 0.22 per quintal compensation given to farmers to encourage cotton cultivation.
The availability of cotton at competitive prices is essential for growth of the country's textile and apparel sector, and urged the Government to change its strategy, as the present strategy has not worked, Mr. Velasquez said. The chairman of ADEX's garment division, Mr. Pedro Gamio Palacios too defended the need to retain the competitiveness of cotton and called for implementing a comprehensive strategy for increasing the productivity and strengthening cooperation among farmers.
He said agriculture is very fragmented with farmers owning tiny plots of land. He suggested increasing the area under cotton plantation, and adapting modern agronomic procedures to yield a good crop that can even be exported. The cotton grown in Peru is bought by the textile industry at prices prevailing in the international market, but owing to lack of productivity and other factors, Peruvian farmers have to depend on Government subsidies to make their prices competitive. The Peruvian Government has been providing subsidy for several years but it has not yielded desired results and hence the strategy should be changed to promotion of modernization of irrigation projects, providing technical assistance, strengthening partnerships, improving access to finance, and increasing the productive areas, Mr. Gamio said.
