Who Will Benefit From The Trade Environment In Britain?

In June 24th, when the referendum was announced in Britain

After that, many British people went back on their words.

Some supporters of Optima stayed in front of the parliament building to oppose Britain's departure from the European Union.

Although there was little chance of turning the tables, they insisted on participating in the "two referendum" on the Internet, hoping to change the outcome.

According to the latest news from China News Agency, Juncker, the chairman of the European Commission, said Britain should explain as soon as possible its plan to break away from the European Union.

But when to talk about peace talks, there are still many uncertainties in the timetable of Britain's departure from Europe.

Therefore, although Britain is now at the cusp of world opinion, and it is still a long time since Britain launched the European Commission, it is still necessary for China's textile and garment enterprises to predict and judge the trade situation and trend towards Britain.

In this regard, the reporter interviewed the China Textile Import and Export Chamber of Commerce, the China Textile Industry Federation International Trade Office and the relevant local trade organization leaders for the first time, and the heads of the top 30 companies from January to May this year.

According to the latest Chinese customs statistics, from January 2016 to May, China's textile and clothing exports to the UK amounted to US $4 billion 200 million, an increase of 3% compared with the same period last year, and China's textile and clothing imports from the UK amounted to US $76 million 340 thousand, up nearly 1% compared with the same period last year.

From January 2016 to May, the import and export volume of textiles and clothing in China and the world decreased year by year, with imports falling by 11% and exports by nearly 2%.

Meanwhile, from January 2016 to May, China's exports to the EU totaled 17 billion 470 million US dollars, down 3.9%, and the export average unit price dropped by 6.6%.

In response, Zhang Xian, vice president of the China Textiles Import and Export Chamber of Commerce, said: "from January 2016 to May, China's growth in exports to the EU and even the globe as a whole is not surprising. It still has 3% growth in Britain.

In recent years, the UK has become the largest market for Chinese textiles and clothing in the European Union and a relatively stable market.

China's export share to the UK has been increasing year by year, according to the statistics of China's textile and clothing exports over the past 20 years.

A group of global market accounts can also confirm this: in May before 2016, the proportion of China's textile and clothing exports to the United Kingdom accounted for 4.16% of the total global export volume and fifth in China's export market; in 2015, China UK textile and clothing trade amounted to US $12 billion 630 million, of which the UK exports accounted for 4.37% of China's global exports to China and fifth in China's export market; in 2014, the proportion of China's textile and garment exports to the UK was 3.86% and the sixth ranked in China's export market. "

According to the reporter

From January 2016 to May, China's list of top 30 list of textile and garment exporters in Britain showed that the export volume of Guangzhou textiles import and Export Group Limited to US $23 million 988 thousand, an increase of 316.25% compared with the same period last year; the import and export limited company of Foshan in Shunde District, Foshan Province, has exported 12 million 62 thousand US dollars to the UK, up 290.1% over the same period last year; Tianjin Tianjin import and Export Co., Ltd. has exported 1083.1 to the UK, an increase of 367.32% million compared with the same period last year.

The export volume of these 3 enterprises in Britain from January 2016 to May doubled over the same period last year.

In response, Wu Zhenghong, Secretary General of the Guangzhou garment industry association, told reporters: "the number of textiles and clothing imported by the UK accounts for more than half of the total market volume annually. The growth of imports of textiles and clothing from China is particularly significant.

Since the international financial crisis, bilateral trade between China and the EU has grown at first place in bilateral trade. The United Kingdom has always advocated strengthening economic and trade relations with China.

Britain is regarded as the most active country in the European Union for the liberalization of trade and investment. Although the foreign trade laws and regulations adopt the EU common policy, in general, the British government has no restrictions on the import or export of enterprises from outside the EU, which has created a good business environment for China's textile and apparel exporting UK.

To sum up, bilateral trade between Chinese and British textiles and clothing is in the honeymoon period. Will Britain break up the gap between China and Britain?

Leigh: pound decreases, profits increase for export enterprises

First, Britain needs a longer negotiation process than Europe.

Wu Zhenghong said: "the United Kingdom will face a long legal process after the withdrawal of the European calendar, and Chinese exporters need not worry too much.

The elaboration of the separation from the EU is mainly concentrated on the fiftieth Lisbon treaty, which only describes the rules of the EU Member States from the EU and has no warning.

Once the fiftieth regulations are implemented, the two countries may have two years to negotiate, but the trade agreement between the UK and the EU may be renegotiated, and the finalizing of the trade rules may take several years. "

Second, after leaving the European Union, the "made in China" entry into the UK market is more smooth.

Whether it is the first to join Asia Investment Bank from the UK or the first to set up offshore RMB center, Britain's free trade tendency toward China is obviously stronger than that of many European continent countries.

"After the British departure from Europe, the possibility of signing a free trade agreement with China alone is not ruled out.

Britain has offered support for the signing of free trade agreements between China and the EU in the first few years. Because of its high trade deficit with China, other Member States believe that China should first liberate investment and expand trade in services and then sign the FTA.

If Britain and China can sign a free trade agreement, then China and the EU will be more likely to sign FTA if they are affected by it.

Liu Yaozhong, deputy director of the International Trade Office of China Federation of textile industry, told reporters.

In the view of journalists, if the Sino British FTA is signed, the EU will not exclude the possibility of opening bilateral negotiations with China and even impose zero tariffs, so the "made in China" entry into the UK market will be more smooth.

Third, China's textile and apparel market share will expand in the UK, and the proportion will gradually increase.

At present, Britain's middle and low grade textiles and clothing are still mainly dependent on imports.

Liu Yaozhong said: "the British Pound's consumer purchasing power is weak due to the British Pound's depreciation.

However, as China's textiles and clothing are inexpensive and cost-effective, they occupy a larger proportion in the UK market, which will stimulate China's textile and garment exports in the coming period, thereby expanding market share in the UK and increasing market share.

Feng Guoxian, the chairman of the Guangzhou textile industry import and export company, which is the top 30 in the country's textile and clothing exports, told reporters: "we are actively exporting fashionable clothing that is marketable in the light of the current demand and seasonal trend of the UK's clothing market."

Fourth, the appreciation of the US dollar and the depreciation of the RMB will obviously increase the profits of enterprises in the short run.

Jiangsu Guotai International Group Huasheng import and Export Co., Ltd. ranked the top 30 in British exports. A business manager who did not want to be named said: "we have settled in US dollars with British customers.

The decline of the pound, the appreciation of the US dollar and the depreciation of the RMB are good for China's export enterprises, because exporters earn US dollars, and from the short-term effect, the actual profits of enterprises are increasing.

In recent years, with the appreciation of RMB, foreign trade enterprises are under great pressure.

"The depreciation of the pound and the depreciation of the RMB are indeed good for export, but this is more reflected in the stock orders.

If the order has not yet been settled, the exchange rate can be earned at high settlement.

The reason for the short term is that if the pound continues to depreciate, British customers will ask for renegotiation. "

Zhang Xian added to reporters: "in the long run, after the economic crisis in Greece and the event of Britain's withdrawal from Europe, the depreciation of the euro will promote the internationalization of RMB and raise China's economic status."

Disadvantages: trade between China and Europe is not convenient to invest or weaken in Britain

First, Britain's shift from China's textile and garment production capacity to other countries may accelerate.

Fan Wenye, general manager of Jiangsu Su Mei textile and Light International Trade Co., Ltd., the top 30 textile and clothing exporters in Britain, expressed concern to reporters: "Britain's Euro stripping has made the pound and the euro much lower, and the range of British textile purchases from overseas will be narrowed. The willingness of the UK to purchase Chinese products will pass on to other Southeast Asian or African countries with lower production costs, which will weaken the price competitiveness of Chinese textile and garment export enterprises.

Although Chinese enterprises can make corresponding price adjustment strategies, after all, the adjustment mechanism needs a certain time, and also needs customer response to accept.

Britain's shift from China's textile and garment production capacity to other countries may accelerate.

Second, the Sino British bilateral trade agreement may face renegotiation and many factors are not controllable.

Wu Hong, Secretary General of Guangdong Textile Industry Association, was very upset.

She said: "Guangdong textile and garment enterprises export more than half of the top 30 in the UK.

After Britain's withdrawal from Europe, bilateral trade agreements between China and Britain may face renegotiation, and many factors are not controllable.

If tariffs increase, China will be extremely disadvantageous to the export of British textiles and clothing.

Feng Guoxian reluctantly said: "since the United Kingdom took off Europe, we now have British customers' intention to reduce orders, and expect more British customers to reduce orders in the future.

In the long run, exchange rate fluctuations will lead to a reduction in orders and profit margins in the UK, which will also increase the cost and risk of export trade in the UK.

Third, Britain's disengagement from Europe and the EU has resulted in a reduction in trade convenience between China and Europe.

Feng Guoxian believed that trade convenience between China and Britain was also greatly reduced.

Under the original EU's unified customs system, goods entering and leaving the European Union do not need to repeat the procedures of customs clearance and declaration. After the United Kingdom left the EU, it formed two totally independent systems, plus the tariff, exchange rate, customs formalities and logistics costs brought about by the European Union.

"In the past, because of the relatively relaxed import declaration policy in the UK, it played a large role in the logistics hub throughout Europe. European goods exported through the United Kingdom, and overseas goods often went through Britain to Europe."

Wu Zhenghong explained to reporters.

According to the analysis of the British Ministry of finance, the relationship between the United Kingdom and the European Union will need to be rebuilt in 2 to 15 years because of the relationship between Britain and the EU.

The Relationship Agreement between China and the United Kingdom and the European Union may be re signed after long negotiations, which will have a greater impact on Sino British and European companies with more trade and investment.

Fourth, the devaluation of the currency has led to a gradual contraction of the UK's attracting foreign investment.

Wu Zhenghong said that in the industrial chain and trade chain, the dependence of Britain on the European Union is higher than that of the EU's dependence on the UK.

In recent years, China's investment in the UK has gradually expanded its depth and breadth. If the United Kingdom is out of Europe, it is expected that China will reduce its long-term investment in the UK, because China will no longer have access to the EU market with the help of the UK.

At the same time, other countries will take similar actions based on the same considerations.

"However, it is also possible that Chinese enterprises will take advantage of the depreciation of the pound and the euro to catch up with the British market. This opportunity investment effect can not be ignored."

Zhang Xian said.