As it works to double textile and apparel exports in four years, Peru plans to invest at least $60 million by 2017 to promote its key designer brands in international markets.
The investment target compares with just $4 million earmarked for such promotion in the past four years, said Luis Torres Paz, export aid agency Promperu’s promotion director.
“We want to internationalize our high-end pima cotton, vicuna and alpaca brands and to do this, we realize we need to invest to help these brands build an international presence, including the designers behind them,” Torres said on the sidelines of the PeruModa textiles trade show held in Peru’s capital, Lima, last month.
Torres said Promperu and Peru’s production ministry will team with private investors to finance the global expansion of a string of established and emerging designer brands. Such trademarks include Kuna and Michelle Belau, in addition to those being created by emerging designers such as Meche Correa, Sergio Davila, Jose Valdivia, Harumi Mamoto and Sumy Kujon.
Torres said Promperu will work to promote these designers in trade fairs around the world. At the same time, it will help them build and finance a production and sourcing platform as “they currently don’t have the capacity to meet large orders.”
Peru will work to enter new markets by participating in trade shows where the designers will be able to show their collections in runway shows. It will also strike commercial alliances with shopping malls to launch promotional campaigns enabling designers to show their best cotton, vicuña and alpaca products. The strategy calls for these designers to eventually open their own stores in malls.
Torres highlighted Dunkelvolk as the type of success story other Peruvian brands should aspire to. The chain of sportswear and beachwear has 10 stores worldwide, three of which are in China.
“They have done a great job at promoting the quality of Peruvian cotton and Peruvian beaches as a tourism destination,” Torres said. “We hope the other brands will be able to do something similar.”
Torres said Michelle Belau, Sergio Davila and a partnership between Meche Correa and Jose Valdivia could open shops in Brazilian malls by year end.
Torres said the $60 million will come partly from Promperu, the production ministry and private investors.
Peru’s plan to double textile and apparel exports comes as part of a more ambitious agenda to also double total exports to $80 billion in the July 2011-July 2016 fiscal period.
Apart from promoting initiatives, Peru is looking to strike free-trade deals with Australia, Brazil and Russia in the near term, commerce and tourism minister Luis Silva Martinot said at a press conference last month.
Together with agro-foods, textiles and apparel make up 60 percent of Peru’s value-added exports, which have grown faster than commodity ones in the past four years, Torres said.
Value-added exports last year totaled $11 billion, of which $2.2 billion came from textiles, apparel and footwear. As the country works to promote itself in new markets in the U.S., Europe and Asia, Torres said, exports should double to $4.4 billion by 2017.
Roughly 45 percent of foreign textile and apparel sales go the U.S., 35 percent to Venezuela, 15 percent to Brazil, Mexico and Colombia and 5 percent to other markets.
Peru is keen to consolidate in key Latin American markets by 2015 before moving to China and Japan with “great intensity” in 2015 to 2017, Torres said.
Exports to Asia have been growing 15 percent a year, he added. However, he acknowledged, Peruvian brands have much work to do before entering Asia.
“We have to build stronger brands before we move to those markets or we could be displaced by highly competitive Vietnamese and Bangladeshi brands which have cashmere and innovative cotton fabrics that can compete with Peru.”