International politics leaves its imprints on all the sectors and industries of the world. There may rarely be an area that remains unaffected by the political and economic happenings around the globe. Textile industry is no exception! If a certain result is announced for the presidential elections in USA, it will have its impacts on the world textile industry. A sudden fall in the share prices of Euronext will affect textile companies all over the world. The recent economic downturn in Europe and USA has had its own effects on the global textile industry.
USA and almost all the European countries were and are somewhat still going through a period of economic turmoil. After the Great Recession, 2008/09 hit the countries, little signs of economic progress have been noticed. Many job losses have been reported since then. Many huge European and American companies went bankrupt. It caused the Wall Street to lose trillions of dollars. It reduced the spending power of a common man in Europe and USA, which eventually affected all the businesses in these countries.
The global textile industry, like all others, has not remained untouched by the economic slowdown in these countries. Europe and USA were and still remain one of the leading textile importers of the world. But owing to the financial crisis in these countries, their obvious choices for textile imports are no longer obvious! Textile giants like India and China may no longer be in their list of lucrative textile exporters, owing to the rising labor charges and inflation in these countries. They are forced to look for cheaper options like Vietnam and Bangladesh. Besides, these cheaper options may also not see trade in the proportion that India and China used to see at some point of time.
The scenario is such that on one hand, the traditional markets of USA and Europe are focusing their attention on the emerging textile industries like Vietnam, Bangladesh, and Cambodia. And on the other, traditional textile exporters like India and China are trying out their luck with emerging textile markets of the world. In the recent past, many new countries like Russia, South Africa, Australia, and Japan have expressed their interest in importing textile and textile products from India and China.
Textile imports into these countries have increased considerably in the past. Shaoxing, one of the biggest textile products exporting cities in China, has more than a 1000 big textile companies to its credit. Out of the total production in the city, textiles comprise of around 64.5 percent. When textile exports into the European markets reduced, these textile companies found a good market in Russia. In fact, many of them have set up their own branches in Russia and are reaping profit out of the same.
Surveys show that Chinese exports to USA decreased by 35.58 percent in the first quarter of 2012. On the other hand, Russia offered a concession to China on textile and apparel exports into the country in the same year. India has a similar story. Surveys indicate that Indian apparel exports into USA reduced by almost 10.6 percent in the first half of 2012. Indian exporters, too, have a lot of hope from Russia and other emerging textile markets.