How Will China'S Textile And Garment Enterprises Survive In The Sino US Trade Friction?

Trump, President of the world clothing shoes and hats, seems never to follow the hidden rules of "making money in harmony", and has been doing things since he came to power, especially the trade protection policy has been escalating.

Under the slogan "American priority", Trump intends to revive the US manufacturing industry through trade protection policies, reverse the US trade deficit and win more political chips in the US mid-term elections in 2018.

According to the memorandum signed by Trump recently, the office of the United States trade representative will set up a specific plan for levying tariffs on Chinese goods within 15 days. The US Treasury will introduce a plan within 60 days to restrict Chinese enterprises from investing in the acquisition of US businesses.

Trump said that the price of Chinese goods would be more than 60 billion dollars.

From the perspective of Sino US trade structure, the potential areas of trade protection in the United States will focus on China's dominant export industries, especially in the US.

Textile, clothing, furniture, toys, metal products and other China's dominant export industries to the United States will break out trade wars between China and the United States. The above industries will become the key areas for us to restrict imports.

If you are engaged in the above industries and the products are exported to the US, the Sino US trade war will definitely affect your order.

Next, let's take the textile and garment industry as an example to make an analysis.

The trade war is obviously bad for China's textile and garment export.

China is the largest exporter of textiles and clothing in the world. At the same time, the export of textiles and clothing is also an important component of China's trade export.

Textile and garment exports account for about 13% of China's total foreign trade.

The top 5 export markets for Chinese textiles and clothing are: 17% in the United States, 8% in Japan, 6% in Hongkong, 5% in Vietnam, and 4% in Britain.

In the 5 major markets of China's textile and clothing exports, the United States occupies the first place.

In 2017, China accounted for 15.5% of the total exports of textiles and clothing to the United States.

From the perspective of export structure, clothing exports accounted for 73%, and textile exports accounted for 27%, accounting for 27%.

Considering that the textile and clothing trade partners in the United States are relatively diverse, and the development of the textile and garment industry is mature and the barriers to entry are low. If there is trade friction between China and the United States, the export of our textile and clothing will be obviously bad.

China and the United States have huge trade surplus in textile and clothing trade.

In 2017, the total volume of textile and apparel trade in China amounted to US $293 billion 150 million, of which US $268 billion 600 million was exported and US $24 billion 550 million was imported, with a total trade surplus of US $244 billion 50 million.

Faced with such a large trade surplus, Trump, a businessman, will surely take the lead in China's textile and garment industry.

The trade war will lead to a sharp decline in China's export orders.

Textile and garment industry is a labor intensive industry, which can solve the employment problem.

Trump wants to return the industry to the United States, but the textile and garment industry in the United States has been shrunk, labor costs are too high, and the possibility of returning to the United States in the short term is low.

If China and the United States fight trade wars, the United States will raise tariffs on textiles and clothing to deal with China.

At present, tariffs on Chinese clothing products are generally around 10-20%. If the tariffs of these products increase to 45%, they will have a greater impact on exports.

After all, the United States has many trading partners. Besides China, it can purchase from Vietnam, Mexico and India. It is easy to pfer orders.

The main importers of textiles and clothing in the United States are China, Vietnam, India, Pakistan, Mexico, Bangladesh and so on.

In 2015, the top four exporters of American textile and clothing were China, Vietnam, India and Mexico, which accounted for 37.25%, 9.43%, 6.68% and 4.52% respectively. Thus, China has an absolute advantage.

As the second largest textile and apparel import market in the United States, Vietnam has the following advantages: relatively complete industry matching, low production cost and abundant labor force.

The Sino US trade war will give Vietnam the favorable conditions to grab orders for textile and apparel products exported to the United States, and China's export orders will fall by 6% to 18 billion 800 million US dollars. This is undoubtedly a major blow.

China is unable to enhance its competitiveness in textile and clothing industry through trade protection.

China's textile and garment industry is an obvious export oriented industry. Imports are very limited, and it is mainly imported from India and other Asian countries. Therefore, it is impossible to enhance the profitability of domestic enterprises by increasing the tariff level on the US and blocking the entry of us products.

If the Sino US trade war continues to escalate, export oriented enterprises may face a business crisis and some of them will be unemployed.

If exports shrink, then they will be affected.

Speed up, to boost domestic demand is an inevitable choice, but this round of price increases, squeezing domestic consumption, pressure to boost domestic demand is self-evident; in addition, it is to increase investment and stimulate consumption, but the current domestic wind risk deleveraging has become the main keynote. At this time, if loosening credit and reinvigorate investment, it will add fuel to the fire.

Trump's foolish decision or "lifting a rock to hit his own feet".

Under the "American priority" thinking, Trump created an increasingly tight world, but the trade war will not be unilateral, but a spiral game process.

Atrophy and depression, geopolitical confrontation rise.

As a result of economic globalization, this round of trade wars is not only hurting China. Once the original international economic and financial order is disrupted, all countries will be negatively affected. As the initiator of the United States, the United States will suffer the greatest harm. Trump will be tasted what is called "lifting a rock to hit one's own foot".

Trump's move has attracted a lot of opposition from the US, and many economists have expressed their enthusiasm for China.

Friction is a foolish decision.

It was meant to revive the American manufacturing industry and win more political chips in the US mid-term elections in 2018. But the American people are not willing to sit on the presidency for Trump.

For our country

Clothing enterprises should have a stronger sense of crisis at this time.

Under the guidance of any environment, we must make more efforts to pform, innovate and speed up internationalization, so as to ensure that orders are not completely pferred, and that we can leave room for ourselves.

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