Exports Are Blocked, And Maintaining The Status Of The Global Supply Chain Is The Top Priority.

The trade figures released in 2020 of 1-2 in March 7, 2020 released by the General Administration of Customs in China showed that China's foreign trade had a significant decline as a result of the extension of the Spring Festival holidays and the outbreak of the new crown pneumonia. According to us dollar statistics, China's imports and exports amounted to US $591 billion 990 million in 2020, down 11% from the same period last year, of which exports amounted to US $292 billion 450 million, down 17.2% from the same period last year; imports amounted to US $299 billion 540 million, down 4% from the same period last year; the trade balance of US $1-2 was the first deficit since March 2018.

From the data point of view, the impact of textile and clothing exports is greater than the overall trade in goods. In the 1-2 months of 2020, textile and garment exports were 29 billion 830 million US dollars, down 20% from the same period last year, of which 13 billion 770 million of textile exports were down 19.9%, and clothing exports were 16 billion 60 million US dollars, down 20% from the same period last year.

According to the relevant restrictive measures adopted by the China Council for the promotion of trade (CCPIT), as of March 23, 2020, 24 countries (regions) have implemented import restrictions on goods; 112 countries (regions) have adopted restrictive measures on flights / trains / ships, including the suspension of all international flights and the prohibition of entry of non citizens; 56 countries (regions) have closed all or part of the ports or added. Quarantine at strong ports; 174 countries (regions) implemented restrictive measures for entry and exit. With the spread of the epidemic in the world in recent weeks, the time limit for the implementation of these trade restrictions is difficult to decide when to cancel.

The epidemic will have a long-term impact on trade in the industry.

One is the uncertainty of trade, which puts China in a position of global supply chain.

China is the world's largest exporter of textiles and clothing. According to WTO data, China's textile exports accounted for 37.9% of global textile exports in 2018, and China's clothing exports accounted for 31.95% of global apparel exports.

At the same time, China's textile industry is also an important link in the global textile and apparel supply chain. In 2019, China's textile exports amounted to US $120 billion 298 million, of which the yarn exports amounted to US $13 billion 208 million and fabric exports amounted to US $60 billion 87 million. The top five textile export markets were the United States, Vietnam, Bangladesh, Japan and Indonesia. Among them, exports to the United States amounted to US $12 billion 452 million, exports to Vietnam amounted to US $12 billion 267 million, exports to Bangladesh were US $6 billion 438 million, exports to Japan amounted to US $5 billion 412 million, and exports to Indonesia amounted to US $4 billion 237 million.

During the epidemic, it was affected by the stoppage of production and export embargo by domestic textile enterprises, and it had already affected the import of textiles from China. Vietnam, for example, relies heavily on China's textile imports. In 2019, China's fabrics and fibers accounted for 60% and 55% of Vietnam's imports, respectively. Therefore, the decline of China's textile exports will lead to the cut-off of textile and apparel production lines in related countries. If the above countries look for alternatives to Chinese suppliers, the position of "made in China" in the global supply chain will be severely affected.

The two is the decline of the consumer side, causing a new round of contraction in the global industrial chain and value chain.

With the increasing proportion of China's textile and garment exports in the world, China's textile and apparel industry has been fully integrated into the global production network and the global value chain system. Such as: China's dependence on imports of raw materials such as cotton and wool; China's yarn and fabric exports not only include developed markets in the United States, Japan and Europe, but also many Asian and African emerging garment exporters. For a long time, China's clothing exports are mainly developed in the US, Japan and Europe. In 2019, exports to the United States amounted to 32 billion 753 million US dollars, and exports to the EU amounted to US $33 billion 935 million. The export volume is US $15 billion 385 million, which accounts for 54.14% of the total export volume of the three major markets.

Affected by the epidemic, global major clothing retailers such as UNIQLO, Zara, H&M, Nike and Adidas have temporarily closed stores in many countries to curb the spread of the new crown virus. In addition, the Tokyo Olympics postponed to the summer of 2021, which caused huge losses to sponsors of sports products, resulting in a sharp decline in the retail sales of the global apparel industry, which led to a new contraction in the global industrial chain and value chain.

Under the impact of the epidemic, the stable supply chain is the top priority.

In March 2020, the impact of the coronavirus (COVID-19) on Global trade released by the United Nations Conference on Trade and development showed that the new crown virus epidemic will cause us $50 billion loss in global value chain exports. In the 13 industries analysed by the report, the textile and garment industry will lose more than 1 billion 500 million dollars (about 10 billion 400 million yuan). Among them, the EU was the most affected, with a loss of US $538 million, mainly because the EU member states such as Italy, France and Spain have maintained close cooperation with Chinese suppliers. China is an important supplier of intermediate products such as yarns, fabrics, zippers, buttons and other accessories in the textile and garment industry.

Economic globalization is mainly manifested in the internationalization of production and capital internationalization. After more than 40 years of reform and opening up, China's textile industry has the complete industrial chain, the most complete categories, and intelligent manufacturing in the leading position of the world. It has become an important part of the global value chain. Its position in the international division of labor has been improving. Two Chinese textile enterprises have entered the world's top 500.

In the context of the outbreak of global pandemic in 2020, the result of steady resumption and resumption of production was the steady supply chain, maintaining the status of China's textile industry in the global supply chain, and preventing the loosening of the global value chain brought by the epidemic. Export enterprises strengthen supply chain risk management, including inventory, logistics and transportation, and supplier diversification, so as to enhance supply chain resilience.

Author: Professor Guo Yan of Beijing Institute Of Fashion Technology