The Rupp Report: Why Not Us?
Jürg Rupp, Executive Editor
One of my best friends is a farmer. No, no, not the same story as last week. Farmers — at least in
Switzerland, and probably elsewhere in the world — are the best-protected professional guild. They
enjoy protection from the government and have the strongest lobby in national parliaments. Every
time farmers decide to ask for more money, they go to the government with their own well-organized
lobby to tell their country that everything’s going down the drain if they don’t get more money.
And they get it.
Support Your Local Farmers …
Often, I have argued with my friend that farmers get what they want, whenever they want, and how much they want. On the other hand, the textile industry has suffered for more than 20 years in the West, and only machinery manufacturers from Europe have been on top of the list. And still, only the farmers got money and nobody helps the tormented textile industry.
… Or The Banks
I don’t want to repeat all the horror messages that appear every day from the financial world, but today’s finance industry enjoys an enormous deluge of money almost every day. It’s surprising to see how much money is available now, and, the appetite comes while we are eating. Now, it’s the car makers; tomorrow, most likely, the chemical industry; and so on.
And Who’s Supporting The Textile Industry?
And who’s helping the textile industry? I was shocked by a response to one question during a business trip last week through Germany. Nobody feels comfortable these days if you ask, How are you? The answer given by one of the top suppliers in Germany was that he has a full order book, but the overseas customers around the world are not able to open an irrevocable letter of credit (L/C). Sorry? What do you mean, are not able to open an L/C? It means they don’t have the money.
No, no, he said. The customers have the money, but the problems is with the banks. As usual, our overseas customers open a L/C with their own local banks. But the corresponding bank in Europe refuses to accept the L/C — they don’t trust each other anymore. I couldn’t believe this and asked again. Yes, he confirmed, that’s the way it is at the moment. Some customers are still willing to invest, but due to these facts it’s impossible. The next question was obvious: Why isn’t your customer paying your invoice directly? In the old days in the silk-weaving industry, fabrics were sold “cash against documents.”
Associations Are In Demand
He only shook his head. So what? Well, he said, we need more “official” support. Do you mean associations? Probably, yes. Now, I was speechless. On the one hand, here we have manufacturers that are not able to supply machinery to their customers thanks to a rotten financial system? This is silly. On the other hand, there are national associations. On top of that, in Europe, there is CEMATEX, the European Association of Textile Machinery Manufacturers.
How come? We are probably in the deepest recession since 1929, and who’s helping the textile industry, which is still one of the cornerstones of the world economy? Is it naïve to challenge all national textile associations to immediately support their local industries? Or even better and stronger, to request CEMATEX to lobby wherever that may be needed. It’s five minutes to midnight and time is running out to support their own members, and that is more important than to organize the next ITMA Asia in 2010 — wherever that may be.
December 16, 2008