Furthermore, even without trade restrictions, U.S. -China textile and apparel trade in 2009 will probably see one of the lowest growth rates in a decade. The gloomy prospect of the U.S. economy sinking deeper into recession is the main cause for the import demand shrinkage. This trend was felt at the 104th China Import and Export Fair -the largest annual trade fair of its kind in China -held early in November 2008. Textile and apparel export contracts from U.S. customers at this time dropped by almost 30 percent compared to the previous year, suggesting a pessimistic outlook for 2009.

Despite the low ebb in trade volume, the year 2009 could be a golden opportunity for the textile and apparel industry both in the United States and China to reform and change. The U.S. textile industry at present urgently needs to figure out some new business models and explore more overseas markets to meet the challenges of lessening domestic demand. On the other hand, the task for the Chinese is to further reduce reliance on exports while absorbing the production capacity of the industry by stimulating more domestic consumption. With the economic interests between the U.S. and Chinese textile and apparel industries conflicting rather than complementary, potential trade tensions will not simply disappear. Restrictive trade policies, perhaps in new forms, are expected to return after 2009.

About the Author

Sheng Lu is currently a doctoral student in the Department of Textile and Apparel Management at the University of Missouri. Before coming to the United States, he graduated from Dong Hua University (the former China Textile University) with bachelors and masters degrees in economics. From 2004 to 2007, he worked for the Shanghai World Trade Organization Affairs Consultation Center, a well-known think-tank in China, and conducted trade policy analyses with a special focus on the textile and apparel industry. Sheng Lu's main research area is the operation of the textile and apparel industry in the globalized economy, including restructuring strategies adopted by developed economies, regional and global production networks, international marketing and merchandising, and trade policy impact assessment.