The Export Trend Of China'S Textile And Clothing To The US And EU Markets In The Post Quota Era

The EU's textile guarantee quota has expired at the end of 2007, and the EU has established bilateral mechanisms with the mainland of China to monitor imports of mainland products.

Since the beginning of 2008, the export performance of the mainland to the European Union has been very good.

If the growth momentum continues or stronger, the EU may take various defensive measures to restrict imports from the mainland.

By the end of 2008, the US guarantee quota for mainland products will also be terminated. The United States can also implement a variety of trade remedy measures, but these measures often have little effect on the protection of US domestic manufacturers.

It is possible for the United States to take expedient measures to implement the current anti-dumping supervision plan against Vietnam as well as to the mainland of China.

In view of the uncertainty in the post quota period, Hongkong exporters should pay close attention to the trend of overseas regulation and take appropriate action.

　　概 要

In 2005, the mainland of China agreed with the United States and the European Union to set up a quota of protection for textiles and clothing exported from the mainland to the two markets.

The agreement with the United States covers 34 categories (21 products) and will be terminated in December 31, 2008.

The EU agreement covers 10 categories of products, which ended at the end of 2007.

To sum up, the quota restrictions imposed by the US on imported textiles and clothing from the mainland of China basically have little effect on the protection of local manufacturers.

Us importers have shifted some restricted products orders to other suppliers, especially in Asia, showing that the quota restrictions do not bring any benefits.

After the quota is terminated, the regulatory trend will continue to affect the US market outlook after 2008.

If imports surge, the US government is under pressure from the domestic industry to adopt trade remedy measures to reduce the impact of the surge in imports.

It is possible for the United States to take expedient measures to implement the current anti-dumping supervision plan against Vietnam as well as to the mainland of China, and will undertake to initiate anti-dumping actions on behalf of the US textile companies if there is evidence that the mainland's products suffer from damaging dumping.

In general, the position of mainland China as the preferred supplier should be able to withstand the increasingly severe challenges of the production environment and further consolidate and even enhance. However, American importers will continue to purchase products from different locations.

In 2008 and beyond, the number of procurement sites for us importers may be further reduced, but we believe that a certain number will still be maintained, especially in Asia.

The EU's textile guarantee quotas expired at the end of 2007.

After that, the EU has established bilateral mechanisms with the mainland of China to monitor the import of textiles and clothing in the mainland.

This dual monitoring mechanism will operate for 1 years, involving 8 categories of the original 10 categories of restrictions, so as to maintain bilateral supervision of trade.

After the expiration of the EU's quota and the introduction of the monitoring mechanism, the mainland's export of textiles and clothing to the EU has increased ideally this year.

On the face of it, this increase has not yet caused an excessive impact on the European Union's production, because the increase in the number of member states in the central, Eastern and southern parts of the EU has helped to ease the decline in the EU's developed member countries.

Nevertheless, if China's export growth momentum continues to be even stronger, the EU may take various defensive measures, such as anti-dumping actions, to restrict imports from the mainland.

It is estimated that in 2008 and beyond, the EU's importers of textiles and clothing will continue to pfer orders steadily to Asian suppliers.

Besides the mainland of China, Vietnam and other countries will also do well.

Turkey and other regional suppliers are expected to compete with the mainland and other suppliers in Asia in the coming years by using duty-free access, being close to the EU market, and having links with EU textile producers in production.

At the same time, Hongkong will gradually reduce its outward processing arrangements with the mainland.

In the absence of a quota restricted trading environment, the outward processing arrangements between Hongkong and the mainland, which are currently established in the European and American markets, will not be reused. However, if the EU and the us take trade remedy measures to the mainland of China, this cooperative production mode will be reactivated.

In view of the uncertainty in the post quota period, Hongkong exporters should pay close attention to the trend of overseas regulation and take appropriate action.

The northward shift of production activities by Hongkong textile and garment manufacturers will certainly help to enhance their competitive edge and profitability. However, we should also consider diversifying production bases instead of concentrating production activities only in the mainland.

In addition, Hong Kong businessmen should further strengthen their relations with overseas buyers, expand to advanced and high value-added businesses, especially focus on design and brand creation, and adopt innovative technology to promote high value-added production business.

In view of the high protectionism and fierce competition in Europe and the United States, Hongkong exporters should seek diversified development and look for potential new markets around the world, especially the huge domestic market in the mainland.

　　一. 背景

In November 2005, the United States signed a comprehensive bilateral agreement on trade in textiles and clothing with the mainland of China.

The two sides agreed that from the beginning of 2006 to the end of 2008, the United States would implement a protective quota for 34 categories (21 kinds) of textiles and clothing imported from the mainland of China.

The agreement also contains a clause requiring the United States to exercise restraint in the effective period of the agreement and try not to implement any guarantee quota for products outside the agreement.

In June 2005, the EU also reached a similar agreement with the mainland of China, from then until the end of 2007, to implement the protective quotas for 10 categories of textiles and clothing imported from the mainland of China.

The EU also promised to take restraint and try not to implement any guarantee quotas in 2008 and treat the products outside the agreement equally.

The two agreements have a significant impact on the trade patterns of textiles and clothing in the United States and the European Union. Some of the production activities that should have been carried out in the mainland of China are diverted to other production sites, mainly in Asian countries.

This trade diversion effect is particularly prominent in the clothing market, because quotas are mainly focused on clothing rather than textiles.

The agreement between the mainland of China and the EU and the United States expired in December 31, 2007 and December 31, 2008 respectively. Although the mainland is still the preferred supplier, the US and Europe will continue to agree.