Interviews
“Diversify export markets”, advise experts
05 Nov '08
3 min read
Recently, the Ministry of Commerce announced that there will be no longer quantity restrictions and permits for textile exports to the United States and license management of shipments to the EU, starting from January 1, 2009. This means that Chinese textile exports will no longer be subject to quota restrictions from the beginning of next year.
But industry experts say, the recent outbreak of global financial crisis has weakened the payment capacity of companies in the US and it will be difficult for the textile industry to change the trend of decline in exports even with the abolition of quota restrictions.
Earlier in the year, from a short term perspective, the Ministry of Commerce had announced twice, the increase in export textile rebates the most recent being in November and now has announced abolition of quotas to the main markets of the US and EU. The announcements of these measures have a clear significance towards promoting and increasing growth in exports.
However, in general, these policies can play only a limited role. The slowdown in China's textile exports and economic growth is here to stay and it will be difficult to reverse the trend, irrespective of sops like increase in export tax rebates or lifting of quota restrictions.
It is well known fact that the subprime crisis in the United States has spread from the financial sector into the overall economy due to which textile consumption has started to decline, which will a bearing on China's textile exports to the United States in the next few months.
According to statistics, in the first half of 2008, U.S. apparel imports from all countries amounted to US $32.997 billion, down $1.389 billion or 4.04 percent. China's share of the fall totaled to $583 million or 41.097 percent of over fall in import value. Imports of textile and clothing from China by the US add up to nearly 30 percent of all imports from the sector.
In fact, although the United States purports to call itself a complete market economy by implementing free trade liberalization measures, the so-called trade liberalization may not be totally free. In recent years, China's exports to the United States have still been subject to a number of non-tariff trade barriers such as anti-dumping measures etc.
As a remedial measure to all ills affecting the Chinese textile and garment industry, experts advise exporting enterprises to diversify their markets and not be dependent on the US markets, the recovery of which is going to take a long time.
But industry experts say, the recent outbreak of global financial crisis has weakened the payment capacity of companies in the US and it will be difficult for the textile industry to change the trend of decline in exports even with the abolition of quota restrictions.
Earlier in the year, from a short term perspective, the Ministry of Commerce had announced twice, the increase in export textile rebates the most recent being in November and now has announced abolition of quotas to the main markets of the US and EU. The announcements of these measures have a clear significance towards promoting and increasing growth in exports.
However, in general, these policies can play only a limited role. The slowdown in China's textile exports and economic growth is here to stay and it will be difficult to reverse the trend, irrespective of sops like increase in export tax rebates or lifting of quota restrictions.
It is well known fact that the subprime crisis in the United States has spread from the financial sector into the overall economy due to which textile consumption has started to decline, which will a bearing on China's textile exports to the United States in the next few months.
According to statistics, in the first half of 2008, U.S. apparel imports from all countries amounted to US $32.997 billion, down $1.389 billion or 4.04 percent. China's share of the fall totaled to $583 million or 41.097 percent of over fall in import value. Imports of textile and clothing from China by the US add up to nearly 30 percent of all imports from the sector.
In fact, although the United States purports to call itself a complete market economy by implementing free trade liberalization measures, the so-called trade liberalization may not be totally free. In recent years, China's exports to the United States have still been subject to a number of non-tariff trade barriers such as anti-dumping measures etc.
As a remedial measure to all ills affecting the Chinese textile and garment industry, experts advise exporting enterprises to diversify their markets and not be dependent on the US markets, the recovery of which is going to take a long time.
Fibre2fashion News Desk - China
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