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A New Round Of Sino US Economic And Trade Consultation Is Coming. What Is The Future Of China'S Textile And Clothing Trade In 2019?

2019/1/21 9:15:00 22

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Sino US Trade Textiles And Clothing Foreign Trade

The Sino US economic and trade consultations have come up with new news recently: the summit of the Ministry of Commerce spokesman said in January 17th that at the invitation of U.S. Treasury Secretary Mnuchin and trade negotiator lettlet,

Vice Premier Liu He

In from January 30th to 31st, he will visit the United States and consult with the US side on the economic and trade issues of the two countries, and jointly promote the implementation of the important consensus of the two heads of state.

This is a relatively good news for Chinese textile and garment exporters facing many uncertain factors.

According to statistics, the monthly export growth of China's textile and clothing has decreased significantly since October 2018.

In December 2018, the overall export of China's textile industry increased again year by year.

According to the statistics released by the customs, in December 2018, China's textile and clothing exports amounted to 231.

$1 billion 700 million, down 3.65% from a year ago.

Among them, exports of textiles (including textile yarns, fabrics and articles) amounted to 98

8 billion 200 million US dollars, down 2.63% from the same period last year, the first time since April 2018, and the export of clothing (including clothing and accessories) is 132.

$3 billion 500 million, down 4 from a year ago.

39%, the drop was further widened compared with last month.

However, according to customs statistics,

From January 2018 to December, the total export volume of textiles and clothing totaled US $276 billion 731 million, an increase of 3.52% over the same period last year, and exports continued to maintain positive growth throughout the year.

Among them, the total export volume of textiles was 119 billion 98 million US dollars, an increase of 8.12% over the same period last year, and the total export volume of garments was 157 billion 633 million US dollars, up 0.29% over the same period last year.

Judging from the general trend, China's domestic economic development has been unchanged for a long time, and a series of policies and measures have been introduced to stabilize foreign trade. The effect is gradually emerging, laying a solid policy foundation for the development of foreign trade this year.

With China's further opening up, it is expected that China's foreign trade development is expected to be stable and upgrading this year.

Well, in this case,

Where will China's textile and apparel foreign trade go in 2019?

Export textile enterprises how to deal with?

Sino US trade frictions are not yet certain.

RMB appreciation or unfavorable export

In 2018, many uncertainties of Sino US trade friction profoundly affected the export business of textile enterprises to the international market.

In the first half of 2018, textile and clothing exports were relatively stable and slightly increased.

In the second half of the year, "change" is mainly reflected in the Sino US trade friction caused by textile enterprises psychological "panic", affecting the clothing export.

Although the export performance of the industry in September 2018 was good, in fact, it was mainly in the context of Sino US trade friction that the maximum number of orders was "to grab exports" to minimize losses.

Since November, garment exports have been showing negative growth.

Some experts predict that

In 2019, China's textile and clothing export environment still faces greater uncertainty. Considering that the US government imposed tariffs on China's $200 billion product in 2019, it remained at 10%. It is estimated that the export situation of the textile and apparel industry is still not optimistic in 2019.

At the fourteenth annual conference of China spinning round table forum,

Gao Yong, party secretary and Secretary General of China Textile Industry Federation

Although the textile and garment products with tariffs in the United States now account for only about 9% of China's export to the United States, and 1.5% of the total global exports of our textile and clothing, the uncertainty of the trade environment is rising, which leads to the instability of the industry. In the short term, the order and the production and marketing of textile enterprises will be reduced. In the middle and long term, the international procurement pattern and the international division position and investment layout structure of our textile industry will have an important impact.

In addition, in 2019, the RMB continued to strengthen. Since January 9th, the RMB exchange rate has risen to a new high of nearly half a year.

This is extremely unfavorable for China's textile and clothing exports. Enterprises will definitely increase their quotations in the international market, and bargaining power will be challenged.

Insiders speculate that

If the value of RMB rises by 1%, then the sales profit margin of the textile industry will drop by 2% to 6%.

With the appreciation of RMB 5%, the profit margin of the textile industry will be reduced by at least 10%.

If the foreign currency price of export products remains unchanged, enterprises will have to squeeze profit margins and suffer greater impact in the context of Sino US trade uncertainty.

Regarding this, China Textile Import and Export Chamber of commerce related personage

It is suggested that enterprises should strive for pformation and upgrading in the face of the downward pressure on exports, and strive to enhance the overall competitiveness of the industry through intelligent manufacturing, industrial chain integration and brand building.

For example, by speeding up the establishment of "machine replacement" and "intelligent factory", we will comprehensively improve production efficiency, product quality and intelligent manufacturing level, and consolidate the competitive advantage of the international market.

The official said,

China has reached 17 free trade agreements with 25 countries and regions worldwide, covering Europe, Asia, Oceania, South America and Africa.

More than 95% of China's and ASEAN's textile and apparel products have achieved two-way zero tariffs. This year, all Chinese products enter the Australian market with zero tariff.

。

Tariff reductions in these countries and regions have strongly promoted the rapid development of bilateral trade, which is the advantage of evading the risk of Sino US trade friction and widening the export market.

For the recent appreciation of the renminbi, textile and garment enterprises are not necessarily bad.

Facing the decline of the US dollar and the appreciation of the RMB, the domestic textile and garment enterprises have adapted and have different solutions.

A listed textile company has a larger export volume, so it takes hedging and other means to deal with exchange rate changes.

Some analysts give the countermeasures to avoid the risk of falling dollar exchange rate: actively excavating new markets abroad, weakening the dependence on the US dollar, making rational use of the financial derivatives market and avoiding exchange rate risks.

Some textile and garment export enterprises use raw materials and intermediate products from abroad, and most of their products are sold abroad. Therefore, the decline in the US dollar exchange rate and the appreciation of the renminbi have little impact on them.

Consumption promotion increases import dividend

Export to domestic sales is not achieved overnight.

In 2019, the uncertainty and complexity of the world economy further enhanced, and the worrying situation made the importance of the domestic market more prominent.

China has the largest and most dynamic textile and clothing consumer market in the world, and it is the fundamental support for the sustained and healthy development of the textile industry.

In 2016, China surpassed the United States for the first time and became the world's largest apparel retail market.

According to the National Bureau of statistics,

In 2017, China's clothing, shoes and hats and other retail sales amounted to about $200 billion, an increase of 7.8% over the previous year, a 3.8 fold increase over 10 years ago.

Some experts believe that in the next 10 years, China will probably become a big importer from a big exporter, and China is changing from a big manufacturing country to a big consumer country. In the process, tariffs will be reduced, and the comprehensive tariffs will be reduced from 9.8% to 7.5% in 2018 alone.

The expert predicted that

"Tariffs will be further adjusted in 2019, and China now has the strength to lower tariffs again."

It can be seen that expanding imports is an inevitable demand for consumption upgrading.

For example, the success of the first Import Expo last year has greatly boosted confidence in the consumer market.

In addition, since January 1, 2019, China has expanded the preferential tax policy for cross-border electricity providers engaging in import trade, and the scope of cross-border import preferential policies has been extended to 37 cities, and the tax exemption quota for single pactions has increased to 5000 yuan.

This reflects the trend of vigorous development of cross-border trade in China.

It is worth noting that according to the relevant statistics,

At present, the per capita clothing consumption expenditure in China is less than 200 US dollars per year, and there is still a gap between the consumption level of textile and clothing which is more than 1000 US dollars from developed countries. This gap shows that there is a big room for development for Chinese export textile enterprises to produce domestic products or to import trade.

In 2019, China's textile and garment foreign trade enterprises must firmly grasp these new opportunities and make breakthroughs in export to domestic sales.

However, whether foreign trade can be successfully pferred to domestic market and whether domestic and foreign trade can be docked as scheduled will be related to the smooth pformation and upgrading of textile and garment enterprises.

For example, for a part of textile and apparel trade enterprises from export to import business, the domestic sales mode is mostly based on stores and shopping malls, and there are many links and expenses in the sales process. Enterprises need to spend a lot of money to dredge channels, while stores generally do not want to introduce imported brands which are not familiar with the domestic market based on the cost of marketing input, which results in the difficulty in importing export products.

And for another part of the spinning and clothing production enterprises from export to domestic sales, the difficulty is not small.

A person in charge of a foreign trade enterprise in Nantong, Jiangsu, who is building an independent home textile brand, said that the problem of brand promotion was rarely considered before. However, the brand has become the most concerned thing for him. The cost of running an independent brand is not low.

In fact, this is not an example.

For many enterprises in the eastern coastal areas engaged in textile and clothing OEM, "one design, one marketing, extending to the two sides of the" Smiling Curve "is the best way to pform the hot debate, but at the moment, this is even more urgent.

It is gratifying to note that

The export textile and garment enterprises in Fujian, Guangdong, Zhejiang, Jiangsu and other regions are implementing the layout and penetration of the domestic market through the construction of a perfect terminal network and a professional market.

Some enterprises begin to expand their sales channels through e-commerce, and not only sell their products, but also update their business ideas.

Other companies are making elaborate articles in terms of service refinement, such as clothing ordering services, and turning their attention to the field of functional clothing, such as explosion-proof clothing and medical protective clothing.

At the same time, many export-oriented enterprises are actively participating in relevant exhibitions in China, and expand the influence of brands and products with the help of exhibition platform.

However, enterprises should continue to adhere to the mature sales methods and strict standards when they are pferred to domestic market, so they can not relax at all because of the domestic market.

In the final analysis, quality is still the key to breaking the market and keeping a firm footing.

There are ways to broaden the international market.

Improving quality is the only way.

In 2019, it may be a watershed for China's textile and garment enterprises. It is facing the rise of trade protectionism in the international market. Since the beginning of the year, the RMB exchange rate has risen, labor costs and so on have not been reduced, but the demand for environmental protection has become stricter.

Seeking breakthroughs in high quality is the magic weapon for enterprises to base themselves on the domestic and international markets.

For the product itself, high quality must be high standard.

Yao Xiaoman, vice chairman of the international feather and feather Bureau and chairman of China feather and down Industry Association

At present,

China is the world's largest producer, export and consumer of feather and down products, occupying 70% to 80% of the global down trade market share. It must be matched to the international advanced level in terms of standards.

To this end, last year, the China feather and down Industry Association issued a group standard of "high quality down garments", which has reached or surpassed international standards, reflecting the strength and responsibility of the industry.

For export enterprises to expand their international market, high quality products are the foundation for enhancing the image of Chinese products.

For example, the Russian market is an important springboard for China's entry into Eastern Europe and the CIS market. Opening up the Russian market will certainly lead to the development of China's market for Eastern Europe and the CIS market.

However, there are also challenges in Sino Russian economic and trade cooperation. Trade frictions occur more frequently, which are manifested by irregular trade operations, frictions between institutional and policy differences, asymmetric trade structure, and "grey customs clearance".

In this regard, experts suggest that

The Russian market is gradually becoming mature. Chinese businessmen must improve their products and establish their own brands if they want to have a foothold.

High quality is the key to future competition, and also a passport that is used in mature markets.

The expert suggests

In the future, the export of textile and clothing should be changed from "extensive management" to "intensive farming" in the countries and regions along the belt and road. From the perspective of specific countries, ethnic groups, aesthetic standards and consumption levels, we should strengthen the study of market segmentation and start from the "supply and demand creation", and expand the broader development space with more creative designs and varieties, and better production.

"Do not put eggs in the same basket" is a reflection of the current Sino US trade friction to the export oriented textile enterprises.

In 2019, many uncertainties of Sino US trade made the export textile enterprises lack confidence in bilateral market development. Therefore, widening the international market has become an important part of export enterprises' consideration of international business this year, which mainly involves two aspects.

First, the division of production and distribution.

Compared with export oriented enterprises based on domestic capacity, the leading enterprises in textile and clothing industry with global layout capacity are relatively less affected by trade friction and stronger in risk resistance.

The head of a Shanghai textile export company to the US said that this year it will step up efforts to shift the supply chain to Southeast Asia and Africa, reducing the risk of many uncertainties in Sino US trade.

In addition, some large textile and garment export enterprises have relatively perfect industrial chains. In response to the "one belt and one road" initiative, they have built their own production bases and industrial parks along with their governments and enterprises in the countries and regions along the way, so as to realize the division of labor in International production.

The two is the layout of the international market.

From the perspective of export, Chinese textile and garment enterprises have limited dependence on the US market.

In 2017, China's textile and clothing exports amounted to US $268 billion 600 million, of which US exports accounted for 17% of the total volume, but still lower than the EU's 18.2%.

Take the proportion of foreign trade in the red bean group, the largest proportion of the European market is 50% to 60%, the US market accounts for 35%, the Japanese market accounts for 10% to 15%, and the market distribution is relatively balanced.

In order to better serve the European market, the red bean group set up the Spanish office, giving full play to the advantages of the foreign office, and directly communicating with the customers face to face, and achieved good results.