One wonders if there is going to be any Hong-Kong group left in our garments industry in a few years? time. After Novel Garments and Summit Textiles, it is now the turn of Sinotex, which is part of the Crystal Group to cease its operations.

The denim manufacturer of Terre-Rouge will put a halt to its activities at the end of March. Some 1 300 redundancies are expected as a result. The enterprise has apparently failed to secure adequate orders to keep it afloat during these testing times for the textile industry. Gap, an American chain of garment retailers recently announced its plans to close its consolidated purchasing unit in Mauritius, which sources products from several producers. Gap moving out of Mauritius has had a huge impact on the business of Sinotex that used to sell half of its output to this agent.

The industry seems to have been caught up in a vicious circle. Gap has decided to shift its operations from Mauritius because of what it claimed as an insufficient amount of goods it could buy from Mauritian sources. The shortage itself is being caused by the exclusion of the large Hong-Kong textile groups from the equation. Several apparel companies are now short of orders as these purchasing agents cease their operations in Mauritius.

There is also the wider context of international competition. The dismantling of the Multi-Fibre agreement puts Mauritian producers on the same footing as those from the huge low-cost countries like China, India and Pakistan. Head-on competition with these giants is feared as the quota advantage of Mauritius is wiped out.

Several factories have already closed down during the past three years causing more than 30,000 job losses. The industry has embarked on a major restructuring exercise that should help improve its competitiveness in the new environment. Mauritius has to find niche markets that are highly remunerative and that will keep our products away from head-on rivalry with big country producers.

But, meanwhile, the sector will register some other closures. There is growing concern about the fate of Southern Textiles, a manufacturer of pull-overs, which has temporarily halted operations due to serious financial problems. The company says it does not have order problems but it cannot access fresh funds to invest in new stock and production.