European crisis spells trouble for Chinese textile exports
31 May '10
2 min read
The impact of the 2008 international financial turmoil was slowly showing signs of tapering off, with exports from the Chinese textile and apparel sector registering positive growth since the last few months.
But the US unemployment rate in April 2010 unexpectedly rose again, along with the spread of sovereign debt crisis in a few countries of the European Union, has now once again raised concerns in the Chinese textile industry.
Europe is a major market of China's textile and apparel exports and the Euro started depreciating since April, since when the RMB has passively appreciated by 14 percent against the Euro, which can have an impact on textile and apparel exports.
A few products from the chemical fibre industry are exported. But a slowdown in fabric and clothing sales could have a greater impact on this very important segment as 48.8 percent of all textile and clothing exports are made from chemical fibres.
According to statistics of China Textile Industry Association, China's global apparel exports reached US $107 billion in 2009, of which those to Europe realized about US $28.409 billion, accounting for about 26.5 percent of clothing exports.
Home textile industry has less dependency on exports to the EU. China's home textile exports to the EU reached US $3.38 billion in 2009, accounting for about 17.91 percent of total textile exports.
But there are many within the textile and garment sector, which are more or less dependent on the countries of the European Union for their exports and it is this group will bear the full brunt in case the European crisis escalates.