IHA News Release

FOR IMMEDIATE RELEASE:
Contact: Deborah A.Teschke
Manager, Media Relations & Communications
847-692-0110

ROSEMONT, ILL (August 7, 2008) –Fact/information-based white papers and other analyses of the Asian manufacturing market and its often complex dynamics are now available to the housewares industry through the IHA University on the International Housewares Association’s website (www.housewares.org), designed to keep companies up-to-date on industry trends and information.

Because of the importance of China to suppliers and because many are looking to newer markets such as India and Vietnam for supply chain alternatives, IHA’s Board of Directors saw a need for updated information on China and its emerging Asian neighbors, said Phil Brandl, IHA’s president, about the Asian Sourcing information.
The information includes:

• Streaming audio of an hour-long presentation, Manufacturing in Asia: Current Reality and Emerging Trends, by Michael L. Hetzel, a noted expert on Asian markets and vice president/Americas at Pro QC International. Hetzel applies first-hand experience and data gathered by his company to discuss the myths and realities of manufacturing in Asia today.
  
• A white paper on recent developments affecting business with China and Vietnam by IHA international trade legal expert Jimmie Reyna of Williams Mullen, which provides legal and regulatory information for IHA members that source from Asia.
  
• A white paper from the North America-Vietnam Trading Agency (NAVTA) that offers background and introductory information on Vietnamese sourcing and factories.
• A white paper offering background and introductory information on Indian sourcing is under development (scheduled for release Oct. 1).

"There is much more happening in Asia than meets the eye,"Brandl says. "Through this information in the online IHA University, we’re trying to provide food for thought and discussion that helps our members plan their Asian business with foresight.”

Manufacturing in Asia Presentation
Hetzel, for instance, emphasizes "context,"saying that influencing factors such as comparative statistics on manufacturing in China versus the U.S., gross national product (GDP) and other information are manipulated for political agendas and distorted by the media, leading to flawed strategic planning for businesses.

"Putting China in context,"he said, means knowing that the U.S. manufacturing output in 2006 was "larger than the entire GDP of China. They may be leaders in certain categories, but think about that. China has also been a very stable manufacturing platform for about 20 years now, but that stability is being disrupted by cost of materials and oil, as well as severe wage inflation, and trade is deflecting to other Asian countries.

"There also is a movement to bring manufacturing into regional proximity to markets and that benefits U.S. and Mexican manufacturers as well as Eastern European manufacturers. Mexico and the U.S. are players again.

"As countries industrialize, they face not only inflation, but the growth of the middle class, which demands services and goods itself,"Hetzel continued. "In China, the government is making policies in many product categories to redirect manufacturing resources to its own markets by increasing tariffs and employing other rules."

Developments Affecting Business in China and Vietnam White Paper
In Reyna’s briefing on China and Vietnam, he says that in addition to China’s continued economic growth, three factors mark the current business climate there:

• Continued revision of key commercial laws to instill tighter government controls in the marketplace and to comply with World Trade Organization commitments and obligations.
• A focus on growing key domestic industry sectors to enhance exports and strengthen its direct investments abroad.
• A diminution of competitive advantages enjoyed by foreign companies as the aforementioned factors advance.

"As those changes occur,"Reyna writes in the executive summary, "many foreign companies in China will develop the sense that the business landscape is shifting beneath their feet…The vision of foreign companies departing Mexican maquiladoras for the plenty of Chinese factories is reminiscent of modern-era global corporate nomads. Countries in Asia and South America that understand this movement are increasingly promising future rich gatherings as they align their trade policies to accommodate an influx of foreign direct investment."

Housewares Manufacturing in Vietnam Today White Paper
Those countries, according to the report by NAVTA, include Vietnam, which has become a "buzz word"in international trade. "Companies can no longer afford to focus on one country for their total product,"the NAVTA white paper says. "They need to differentiate not only their product lines but also their country of manufacture to create a safety valve. This has been referred to as a `China +1’ policy.”

The report also notes that today, a rudimentary infrastructure is a "critical hindrance"to Vietnam’s growth and development, such as a lack of a deep water port and higher transportation costs to trans-ship containers to Singapore or Hong Kong.

IHA’s Board of Directors has authorized the development of programs to assist IHA members with their Vietnamese sourcing needs, the report adds. Additional information can be found at www.housewares.org/iha/global. Vietnamese sourcing trade missions have already taken place, bringing IHA members face-to-face with pre-screened and pre-qualified Vietnamese manufacturers.

The IHA sourcing trade mission agreement with NAVTA includes initial factory searches and reports and one-on-one factory meetings and factory tours, the report says. After an IHA trade mission, NAVTA can offer further independent customized sourcing functions including price negotiations, factory oversight and compliance, quality control inspections, consolidation and shipping assistance.

To download the Hetzel presentation and to view the two white papers, go to www.housewares.org/kc/uni