With an experience of more than two decades Arancha Gonzalez has been working as the executive director of International Trade Centre (ITC). Gonzalez, a citizen of Spain has quality work experience with the World Trade Organisation (WTO) and European Union (EU). During her tenure at WTO, along with director general of WTO Pascal Lamy, she worked to develop the programme Aid For Trade for the promotion of Least Developed Countries (LDCs). Recently Gonzalez shared her experience to Hom Nath Gaire of New Business Age during her visit to Nepal for the formal launching of Pashmina Enhancment and Trade Support (PETS) project. Excerpts: What potential do you see for Nepali Chyangra Pashmina'in the international market?
Potential is very big for Nepali Chyangra Pashmina in the international market as it has already a brand name. Global consumers buy Nepali Chyangra Pashmina conceiving it as a good quality product. However, it is fair to say that these products have some challenges, which need to be addressed. Firstly, issues related to the quality of spinning, weaving, and design are crucial to brand building. This should be resolved, as consumer look for good quality in products when they spend substantial amount of money in them.
Secondly, branding Nepali Pashmina is very important to ensure that it reaches intended high value consumers. If you think your Pashmina has high value, then you have to target consumers who can afford it and thereby generate enough revenue to sustain the product.
The third area is looking for new market avenues. Chyangra Pashmina has been traditionally marketed to some European countries. However, there are huge untapped markets, like the United States, Canada, Japan, Australia and other countries where there are consumers, especially women, who appreciate the fineness of the product and can afford high quality Pashmina. So, the prospect for Nepali Chyangra Pashmina is good, provided that we work on all these three issues - quality, market and branding. This will provide the much needed competitive edge to Chyangra Pashmina in the international market.
How can International Trade Centre (ITC) help in this ?
We have 50 years of experience in helping small and medium enterprises become competitive. We will put this experience to the service of Nepal’s Pashmina industry. We need to diagnose roots of the problems that this industry is facing. Some of these problems are quality of the yarn, dyeing and reliability of the supply. We can increase competitive advantage of the products in terms of price with new technologies. We are working along this line with our partner, Nepal Pashmina Industries Association (NPIA), in this project.
ITC has been implementing a project in Africa namely Ethical Fashion Initiative (EFI). Is it possible to carry out similar kinds of projects here in Nepal ?
The Ethical Fashion Initiative (EFI) is precisely trying to help create a product in the market, which will be recognised as a high fashion product. The good thing about Nepal is that the country already has that product called Pashmina. Nepal does not have the problem of production. The question here is to expand the market and improve the competitiveness. The need for now is to find new market that has comparative advantage and to create a brand in the market. Similarly, we have to add value to the Pashmina and sell it at a premium price. For this, we suggest not selling Pashmina through street vendors, rather selling them through big fashion houses, and not asking $ 5 for a Pashmina product that has potential to fetch $ 500. It is important to understand the market that one is trying to reach.
In recent times, Least Developed Countries (LDCs) like Nepal have taken Non-tariff Measures (NTMs) and Quantitative Restrictions as major obstacles for their export promotion. In this context, what do you think about the duty-free quota-free schemes?
The quota system is definitely being seen as a barrier in the international trade. The international community, especially the developed countries have agreed to give duty free and quote-free schemes to LDCs like Nepal. Many developing countries have also been providing duty-free quota-free schemes. Similarly, there is special provision for preferential treatment for LDCs in multilateral organizations like World Trade Organization (WTO).
The countries that have signed the agreement have to remain committed to it. None of them can run away from this agreement of providing duty-free quota-free schemes to LDCs. Likewise the LDCs should also be able to benefit from these facilities. ITC has always been working to facilitate international trade all over the world especially in LDCs.
Experiences so far indicate that the efficiency of a project operated by the government and national level private sector agencies is very low. In this context, how do you plan to implement your project efficiently for gaining the project’s objective?
For any project to be successful, there are three major parties - the government, the private sector and a development partner. The private sector has a major role to play. The Nepali Pashmina project will not be driven by the ITC or by the ministry. The private sector actors will drive it and they have already shown interest in this project. Its success lies in their hands. Similarly, for the success of the project, strong monitoring and evaluation is required. I strongly believe that with the constant support of the private sector, this project will not only be successful, but will be exemplary.
Are there any possibilities to launch other projects like PETS to facilitate export promotion of other goods and services identified by the Nepal Trade Integration Strategy (NTIS)?
There is a huge potential in other sectors as well. This is what I told the Finance Minister as well. I told him that Nepal has a potential to intervene in a similar way to expand in other sectors like agriculture and tourism. Potential sectors have to be identified and specific projects have to be developed. ITC is always ready to support the government
in these initiatives.
