MEXICO CITY — Mexico’s textile and apparel industry is increasingly concerned about a growing threat from China: the Dragon Mart.
The $200 million project that could see 1,600 Chinese companies descend on the Cancún beach resort is quickly advancing. This is because the regional government of Quintana Roo recently granted promoters a construction license to build a 1,380-acre exhibition center or mall slated to open this year.
The Dragon Mart has stirred huge controversy in Mexico because it will allow Chinese firms to sell a range of consumer goods, including toys and furniture, locally and for export to the U.S., Central and South America.
While the permits boosted hopes the mall will be set up, detractors are betting a pending environmental license will help build momentum to delay or scrap the project. Mexico’s environmental secretariat Semarnat has yet to rule if the mall requires such a permit, something green groups claim it does because it will be built two miles from the Arrecife Natural Park — a UNESCO-protected site.
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Promoters have agreed to forbid Chinese-made textile and footwear products to be sold in the mall. However, there is no guarantee they won’t, Rosario Mendoza, managing board director of the Jalisco State branch of Mexico’s leading textiles group Canaive, stressed.
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“We are very concerned,” Mendoza told WWD. “There are over 10 consumer goods sectors that will participate, including one labeled as ‘Various.’ Who is to say textile and apparel goods won’t be imported and sold through there? There are no guarantees.”
Household or industrial textiles may also trickle through because of ambiguity in the market’s rules, Mendoza added.
The fledgling construction license also killed a Canaive initiative to establish a so-called Latin Mart that would have exported Mexican, Peruvian, Colombian and Chilean textile and apparel goods to similar markets.
“Our hopes for Latin Mart have dimmed,” Mendoza said. “The government did not listen to us.”
In October, Canaive urged Mexico City to reject Dragon Mart, saying it would hurt the industry, which is already battling against a flood of subvalued Chinese imports.
Meanwhile, Mexico recently approved a Customs-law overhaul to boost illegal merchandise detection technology and help strengthen raids. While welcoming the measure, Mendoza reiterated Mexico needs stronger political will to abate its growing contraband trade, which accounts for 60 percent of clothing sales.
“Piracy and contraband is Mexico and our industry’s cancer,” Mendoza said. “It continues to advance and does not want to give up.”
“We don’t understand why and how so much clothing can enter illegally and end [up] in our shopping malls and flea markets,” she added. “Every time we try to investigate, we face a lot of paperwork and impediments. Our industry’s sales continue to fall.”
As the problem worsens, Mendoza said, Canaive’s goal to slash contraband to 40 percent of sales by 2016 is becoming increasingly tougher to achieve.