Hong Kong & Interstoff Asia: Ongoing Transition

long time ago, the Interstoff show in Frankfurt was the top fabric show for Messe
Frankfurt. Other shows in Europe have taken over as the top events for the European novelty and
fabric producers; however, Interstoff Asia has kept its market place in Asia as an important event
in the annual fair calendar. To reflect changes in the fair’s concept and product offerings, the
show recently was rebranded Interstoff Asia Essential.

The Autumn Interstoff Asia Essential fair — which ran Oct. 3-5, 2007, at the Hong Kong
Convention and Exhibition Centre — attracted more than 8,500 buyers from 55 countries and regions
to see new, niche fabrics.

Textile World Asia
visited the show and interviewed Katy Lam, director, Trade Fairs, Messe Frankfurt (HK)
Ltd. — organizer of the show — to learn more about the reasons for the show’s ongoing success.


Interstoff Asia Essential, held at the Hong Kong Convention and Exhibition Centre,
attracted 8,500 buyers from 55 countries and regions.

The Interstoff

TW Asia
: What is the actual role of Messe Frankfurt HK today?

Katy Lam: We are the head office of the Asia Region of Messe Frankfurt, apart from
Hong Kong, also for China, Thailand and Malaysia. We organize some 25 trade fairs with different
topics, and also organize group tours to China or Taiwan and to other exhibitions.

TW Asia
: What has changed most in the last 10 years?

Lam: Today, we’re the biggest show organizer in Asia; we’re following trends and
looking for added value for our exhibitors. In general, the customer has changed, but not for
textile fairs. Intertextile in Shanghai, also organized by Messe Frankfurt HK, is bigger with more
exhibitors and products, but Interstoff in Hong Kong is more sophisticated.

TW Asia
: Do the Chinese exhibitions affect events in Hong Kong?

Lam: Well, Interstoff is facing competition from everywhere. We went to China much
earlier than other organizers because we wanted to offer exhibitions for different industries. We
have an Intertextile in Beijing, Shanghai and Shenzhen. Intertextile is another name, but it
belongs to the Interstoff Group.

TW Asia
: The world textile markets have changed a lot. Who is your customer today in Hong

Lam: The customer is quite sophisticated. Here, the buyers are on a higher level;
there are fewer people, but they are true specialists. Interstoff also is the forum in which to
bring more high-quality products to the markets.

TW Asia
: Why should people come to Hong Kong to visit Interstoff?

We have to further develop our concept and, as part of that, bring the manufacturers and buyers
into a closer business relationship. We invite suppliers to come to the show and have a look. We
want to be the Asian platform for innovative ideas in the whole textile business. For this we also
organize seminars. Today, the buyers know exactly what they’re looking for. Interstoff Asia
Essential remains a key resource for garment industry professionals needing information on style
and fabric trends. Elsewhere, during the seminar sessions, the Paris-based Nelly Rodi Agency gave
an overview of the Directions Trend Committee forecasts for colors, prints, patterns and textures
for Autumn/Winter 2008-09. An audience of approximately 100 garment industry professionals attended
the presentation, which further explained the three trend stories, “Ice Eco,”  “Bobo Craft” and “Techno Fiction,” which were illustrated with fabric
swatches in a vivid display inside the exhibition hall.

Eco-Textiles Advancing

TW Asia
: More and more Interstoff exhibitors and lecturers presented a wide range of fabrics
made with organic and eco-friendly natural products, and those with multiple functions and special
properties. So, is today’s consciousness regarding environmentally friendly production an issue for
Interstoff Asia?

Lam: Absolutely. One of our seminars was called “Eco-Textiles: Fabrics that Care.“
With approximately half of the 222 exhibitors showing in the categories “eco-textiles” or “
functional fabrics,” the show and seminar were good resourcing opportunities for buyers and
interested companies seeking new and pioneering products available in the world fabric market. More
than 300 fabrics were shown in these special displays in Autumn 2007, including ‘eco’ products made
from organic cotton, bamboo, soybean, hemp and milk proteins. Eco-textile exhibitors at the fair
could be easily identified by a green or silver leaf logo on their stand; the green logo signifying
fabrics made with environmentally friendly materials, and the silver logo signifying an entirely
eco-friendly manufacturing process.

TW Asia
: What are the main reasons for this eco success?

Lam: I’m sure the important brands and retailers are looking for a credible Asian
sourcing event for sustainable and eco-friendly fabrics, which are more and more in demand in the
Western world, particularly in Europe. Now, with its move towards a focus on eco-textiles,
Interstoff Asia is breaking new ground and taking a step forward to satisfy the growing needs of
retailers and sourcing houses. Global top street clothing brands, top-level designer labels, major
retail chains and specialist sportswear and underwear brands visited the show, reflecting the trend
towards eco-friendly and functional fashion in consumer apparel markets.


Interstoff Asia Essential exhibitors and lecturers presented a wide range of fabrics made
with organic and eco-friendly, natural products.

The New Role Of Hong Kong

TW Asia
: How do you see the role of Hong Kong today?

Lam: It has become more complex in the past few years. For textiles, Hong Kong has
been transformed into a service and information center to be able to present the latest novelties
for fashion and function. Hong Kong must be very dynamic and approach the markets in a very active
form. The whole quality and service package must be first-class. However, Hong Kong is used to
delivering first-class full service in different areas.

TW Asia
: Is Hong Kong losing ground to places like Shenzhen or Shanghai, or is it still the
gateway to Asia?

Lam: It is, absolutely; all the highly qualified people are here. To mention just
a few reasons: the very solid financial background; an open economy; and no problems with

TW Asia:
The question must come: Did the handover to China affect the importance of Hong Kong?

Lam: Not at all.

TW Asia
: Why not?

Lam: Well, the only thing that really changed is the fact that China and Hong Kong
have now even closer ties. The situation is more open to do business with China — it has become
easier, the logistics are better, just to mention a few reasons. Before the handover, everything
was very complicated. With the CEPA concept, everything became much easier (See sidebar below).


Interstoff Asia Essential remains a key source for garment industry professionals needing
information on style and fabric trends.

The Changing Role Of China

TW Asia:
How do you see the role of China today?

Lam: In the future, the role of China will be more focused on the domestic market,
and not only on exports. Today, 70 percent of all products are exported. If China is producing more
for the domestic market, it will be tougher for some markets in the world. We will then have a
situation which will be the other way around: Everything will be more expensive and China becomes a

TW Asia
: Where do you see the biggest problems for China, problems such as energy and wastewater

Lam: There are big problems to solve. China is still considered a developing
country; however, it has the same problems as the Europeans, for example. Like many issues today,
this is first of all a matter of communication. China must sensitize its people for these problems.
If the education level of the people is increasing, I’m convinced that China will succeed. There is
no other way out of this.

TW Asia
: If a foreign company wants to start its activities in China, what do you suggest it

Lam: It depends basically on the size of the company. For smaller enterprises, a
joint-venture partner might be the right solution. Bigger companies might take the direct way into
the Chinese market. However, both ways are not easy; it takes a local partner and a lot of

Positive Market Situation

TW Asia
: How do you see the market in general? What about textiles?

Lam: Very positive. Big foreign companies are present in the Chinese market. The
Chinese enterprises are active and have more and more their own R&D today. Up to now, that was
more low-key. Also, the situation for textiles changed a lot. For example, in the beginning, most
of the high-quality yarns had to be imported. Now the Chinese spinners are able to produce much
better quality for export purposes. Also, for fashionable products it was the same. Now the
production plants are becoming more modern and are able to produce high-fashion articles. However,
this is again mainly for the domestic market, and with this story we might be again in front of
empty shelves in the Western world. Based on this, the importance and the position of China in the
global textile markets will further increase.

TW Asia
: Are the big global department stores still raising their purchasing power, and will
small and medium-sized enterprises disappear more and more?

Lam: It seems to be, and that’s quite a problem for some business sectors. We’l l
see the results in the near future, I’m sure of that.


TW Asia
: Which countries do you consider to be the top competitors for the Chinese textile

Lam: Well, first of all, every country has a chance today. Certainly India and
Vietnam are strengthening their power, and Central and South America as well as Europe on a lower
level. With the already mentioned changing market situation in the mainland, other countries will
certainly have a bigger chance to play a more important role in the global markets.

TW Asia
: How do you see the future of Messe Frankfurt HK with all this heavy competition in the
exhibition market?

Lam: I see our future as very bright. Thirteen years ago, we had one show per
year, now we have 25 events a year, which materialized because of the opening of China. And, as I
mentioned before, we are the top player in textile fairs, at least in China. And we do everything
to keep our first place.

The next Interstoff Asia Essential is set for
March 12-14, 2008.

The CEPA Concept: Opportunities For Hong Kong

From the implementation of the Closer Economic Partnership Agreement (CEPA) in
2004 until the first half of 2007, mainland China and Hong Kong reached agreement on the rules of
origin for a total of 1,448 products. Effective July 1, 2007, 17 new products were added to the
list of goods eligible for tariff-free treatment under CEPA. As a result, the number of products
with agreed CEPA rules of origin — eligible for zero-duty access to the mainland market — increased
from 1,448 to 1,465. For these items, the applicable tariff rates that would otherwise apply range
from 4 to 30 percent.

Consistent with the mainland’s commitment as stated in its 11th Five-Year Plan
to support the development of financial services in Hong Kong and maintain Hong Kong’s status as an
international financial center, the two sides have agreed to strengthen cooperation in the areas of
finance. Apart from this, the mainland also has agreed to offer support and cooperation to Hong
Kong for organizing large-scale international conventions and exhibitions.

In 2006, Hong Kong’s domestic exports of these 17 products to the mainland
amounted only to HKD 8 million. But now with zero-duty access, Hong Kong’s domestic exports of
these products to the Chinese mainland are expected to increase in the time ahead.

For more information, see

January/February 2008