&Nbsp Under US Trade Protection; Where Will China's Clothing Enterprises Go?

"When Chinese textile companies are looking at other emerging markets because of the operational risks brought by the rise of protectionism in the United States, it is likely that those emerging markets are already taking some trade protection measures."

He Haiqing has received important notices from several industries that, in a short period of time, as well as the increasing trade protectionism in the United States, he is the deputy general manager of Zhejiang Fortune Holdings Group, the principal person in import and export business, and the export warning expert of the China Textile Industry Association. He Haiqing will attend the meetings frequently in 9 and October. She estimated that these "hurriedly" meetings will focus on the recent trend of "trade protectionism" in the United States.

In the early September 2009, a new round of trade frictions launched by the United States stirred up all walks of life in China, which had been denounced by domestic experts as absurd and difficult to apply for the special safeguard of imported Chinese tyres. It was finally "regrettable" and was approved by the Obama administration by accident. Thus, as China Textile and garment industry Employees, He Haiqing also began to worry that the "trade protection" from the tire special protection case will extend to China's textile and garment industry.

Us special safeguard continues

"I think the US trade protection policy is likely to extend to China's textile and garment industry. Considering that China's tire industry already has such a precedent, I think this will further affect the textile industry." He Haiqing is worried about changes in the US market. In fact, this worry is partly confirmed by the latest information from the United States.

At the time of He Haiqing's interview with our newspaper reporter, the US textile Union formally filed a 421 special safeguard investigation with the US International Trade Commission (ITC), which mainly aimed at China's textile and garment industry. This means that China's textile industry will have to face the situation faced by the Chinese tire industry not long ago. It also completely destroyed the few "fair expectations" and "optimism" left by some employees in the industry.

At present, there is not much knowledge about the specific information about the 421 special safeguard investigation in the United States, such as the number of tax increases, the investigation process and so on. However, this does not prevent more people in the industry from starting to update their assessment of future changes in the US market.

As one of the most influential listed companies in China's textile and garment industry, Zhejiang has a considerable amount of business exported to the US market, for example, its knitting products export to the US market annually is over $10 million. Wool spinning Products are also around $5 million.

Now, the "change" in the US market has also stirred up the mood of rich and prosperous.

"In fact, since the global financial crisis, many enterprises on our side have been able to develop. For example, many socks factories in Zhuji, Zhejiang have been doing well. This is because the demand for expensive textiles has decreased, but the demand for cheap, medium and low-grade products produced by China is still strong, and even some categories of products demand more than before." He Haiqing explained the plaguing problems of rich, "therefore, it can be said that the financial crisis has an impact on us, but Chinese enterprises still have space. Now, in this case, if the United States starts to trade protection, it will really have a great impact on our socks factories."

However, He Haiqing believes that China's textile and garment industry is unlikely to be protected in the future as much as the United States has done to China's steel and tyre industry, because the rigid demand of the United States for Chinese textile and apparel products still exists. {page_break}

Expect the Chinese government to fight back hard.

For the rich and the smooth, the increasingly tense Sino US trade friction means the deterioration of the business environment and the emergence of greater challenges since the global financial crisis.

Therefore, as an important member of China's textile and garment industry, Fu run has to take the initiative or passively cope with the current "difficult" trade situation.

In the view of Fu run, it is no doubt that the role of the Chinese government is of great importance in order to prevent the "trade protection sentiment" of the United States from extending to the Chinese textile and garment industry.

"We hope that the Chinese government should be more tough with protectionism in the US." He Haiqing explained, "before, the United States has been calling for trade measures. If we strongly oppose the US trade protection policy and let the US have some scruples, they may give up. After all, the United States also subsidized some industries, such as agricultural products, and we take some tough measures. They will think about it. Anyway, it has been done before, so as to prevent the trend of protectionism in the United States from outside the textile industry.

"If we are always worried, what will happen to the United States instead of us?" He Haiqing emphasized.

Although in the macro policy level, Fu run has its own views, but the decision at the government level is obviously difficult to run. Therefore, for the future worry, at the moment, more rich from their own consideration to take the initiative to circumvent.

In this regard, one of the answers given by Fu run is trade diversification. However, in a series of efforts to diversify exports, it has to face all kinds of difficult choices. These choices will change rapidly. This is mainly due to the fact that Fu run is in a global economic environment with a trade protectionism.

Russia's dilemma

"The Russian market deserves our attention." Just last Tuesday, when the group discussed with some of its subsidiaries what new markets were worth expanding and preferred, 2 of the companies involved in the discussion voted on the Russian market, while the rest of the other branches preferred the Dubai market.

This seems to be an important choice for rich. In the US, trade trend is becoming more and more obvious. Now, the question of rich is whether the emerging markets to be nurtured are to go to Russia first or to expand and set up branches in the Dubai market.

What worries the rich is that such a choice is very susceptible to interference from the outside world. When the reporter told Hai Qing about the latest developments in the Russian market (the date of the news release and the reporter's interview with He Haiqing on the same day) - they may impose prohibited tariffs on Chinese clothing and footwear products, and sent the news to He Haiqing, the first time she heard such news, she immediately showed some concern about the company's strategy in Russia.

An hour later, after He Haiqing's partial confirmation of the news, she seemed to have made a new decision.

He Haiqing told reporters that the Russian market has turned from concern to continued concern, which means, "in view of the latest developments, we may arrange for a visit to Dubai first." {page_break}

It is clear that Russia's latest "trade position" has had an impact on the decision of Fu run, which has made Fu run from the previous swing to a more inclined Dubai, which has taken less than an hour before and after.

Before, although Russia had straighten out the "grey customs clearance", it appeared to be bad for Chinese exports. But Fu run believes that the Russian market after the reorganization is even more beneficial to China's textile industry. Clothing products Exit.

In the period of "grey customs clearance", the Russian market was chaotic, which was not conducive to the development of trade. After the reorganization of the Russian government and the discussion with the Chinese government on the establishment of a "white customs clearance", we believe that we will have more opportunities to do it according to the formal channels. He Haiqing said, "now, this kind of thing has come out (Russia may impose prohibited tariffs), which will greatly affect our choice."

Deep tillage USA branch

The variables in Russian market reflect the bad trade environment of Chinese textile and garment enterprises. If China wants to avoid the US's exposure to other emerging markets due to the business risks arising from protectionism, Chinese textile enterprises may find that some emerging markets have already taken some trade protection measures.

Therefore, it is far from enough to place a single emphasis on trade diversification on trade diversification.

Fu ran thinks so. For this reason, in the context of possible new trade protection measures and trade diversification efforts in the United States, Fu Yun proposes to go directly to the United States, run well established us branches, and develop strategies that are more suitable for the US market to avoid trade risks.

He Haiqing believes that if the United States takes a trade protectionist stance, its subsidiary in the United States will bring opportunities. However, it did not disclose this opportunity too much on the grounds of commercial secrets.

At present, Fu run has two branches in the US, one in New York and one in New Jersey. But it has no factories in the United States and the company has no plans to set up factories in the United States. This means that if the US adopts trade protection measures, in theory, it is still outside the "protection", because the rich products are still produced and imported from China.

But from a practical point of view, such as the United States branch of the United States can do re export trade, and so on, it may be part of the trade risk to avoid the prevalence of protectionism in the United States.

"The East is not bright, the west is bright. In 2003, we set up a branch in the United States. I want to say that our experience is very good. We think that since the branch is opened in the United States, there will be an opportunity." He Haiqing said.