The year 2017 is an important year for the implementation of the “13th Five-Year Plan†favorable policies. Exports of textiles and garments may reverse the trend of declining for two consecutive years and enter a period of major development and major adjustment.
Since the beginning of this year, China’s textile industry has responded more actively to the call of the “One Belt and One Road Initiative†and has developed in depth. The awareness of China's textile backbone enterprises to take the initiative in international deployment has been significantly improved. At the same time, under the situation that foreign trade has stabilized and picked up, China's textile and clothing industry is also facing a severe trade friction situation this year. The rise of international trade protectionism has led developed countries and emerging economies to squeeze China’s foreign trade exports. At the same time, frequent events such as the Trump New Deal and Britain's Brexit's "black swan event" have caused an ever-increasing uncertainty in China's textile and apparel trade.
Trend 1
Textile industry "going out" to develop in depth
Since the beginning of this year, China’s textile industry has responded more actively to the call of the “One Belt and One Road Initiative†and has developed in depth. With the continuous strengthening of the “five links†such as policy communication, facility connectivity, smooth trading, financial financing, and people-to-people links, the ability of the Chinese textile industry to “go global†for global distribution and capacity cooperation has been continuously enhanced.
News Review China Textile Industry Federation officially announced in March in Shanghai that the "China Textile International Capacity Cooperation Enterprise Alliance" was established. As of the end of November, the number of members of the China Textile International Capacity Cooperation Enterprise Alliance reached 104. This is a major move taken by the Chinese textile industry in integrating the national “One Belt and One Road†initiative. It also marks a major turning point in China’s textile industry’s drive from product exports to exports and international capacity cooperation. This year, the pace of “going out†of the Chinese textile industry has further accelerated. It has covered Vietnam, Myanmar, Morocco, Tunisia, Hungary, Romania, South Africa, Italy, and the United States. In September, the “Going Out†2017 China Textile Industry Conference hosted by the China Textile International Capacity Cooperation Enterprise Alliance was held in Nanjing. During the conference, heavyweight guests from many countries spoke in a row, leading to a heated discussion about the “going out†of the Chinese textile industry.
Take Ethiopia as an example. Ethiopia is an important country along the “Belt and Roadâ€. In May this year, the Ethiopian Prime Minister and the Chinese textile entrepreneurs met in Beijing. Representatives of Chinese textile companies took advantage of this rare opportunity to communicate with the Prime Minister and Ethiopian representatives. In June, the China Textile Association led a business delegation to Ethiopia for investment and research for the third time. The delegation held a meeting with the Ethiopian Prime Minister's adviser Dr. Alkabe in the Prime Minister's Office. The two sides exchanged and discussed the next step in the cooperation memorandum. In November, China Textile Association visited Ethiopia for the fourth time. The delegation and the Ethiopian Prime Minister’s special adviser, the representative of Ethiopia, as well as the Ethiopian Investment Commission, held working talks and exchanged views with the Chargé d’affaires of the Chinese Embassy in Ethiopia. The delegation believes that China's textile enterprises have greater room for cooperation with Egypt in such segments as automotive textiles and recycled fibers. Ethiopian attaches great importance to cooperation with Chinese textile companies. It not only ranks the textile and clothing industry as a key national development industry, but also establishes a Chinese affairs office in government departments such as the Ministry of Finance, Customs and Investment Committee to assist Chinese companies in their investment cooperation with Ethiopia. At present, China Textile Union has listed Ethiopia as a key country for textile international capacity cooperation.
Trend 2
Foreign trade stopped falling and stabilized
2017 was an important year for the implementation of various favorable policies for the “Thirteenth Five-Year Planâ€. With the deepening of supply-side reforms and the acceleration of corporate transformation and upgrading, the structure of foreign trade has been further optimized. Statistics show that in 2017 China's textile and apparel exports are expected to reverse the downward trend for two consecutive years, and the annual export growth rate will be between 1% and 2% in US dollars.
In the first half of the press review, China's textiles and apparel exports were US$53.15 billion and US$71.12 billion respectively, and textiles increased by 1.7% year-on-year. The export volume of major categories of goods maintained year-on-year growth: yarns and fabrics increased by 5.2% and 7.9%, respectively, and needle-knitted garments increased by 3.9%. From January to June, China’s textile and apparel trade volume was US$ 135.78 billion, up 0.4% year-on-year, of which exports were US$ 124.27 billion, which was the same as the same period of last year.
In the second half of the month, China’s textile and apparel trade volume reached US$27.57 billion in July, a year-on-year increase of 1.6%, of which exports were US$25.49 billion, up 1.4%. From January to July, the value of China's textile and apparel trade was US$163.35 billion, a year-on-year increase of 0.6%. Of which exports were $149.75 billion, up 0.3%. In August, the rapid fluctuations in the exchange rate in the short term were not conducive to exports, and to a certain extent, the pace of sustained export growth in August was blocked. The monthly export of textile and clothing products experienced a negative growth after five consecutive months of growth, but the decline was modest, and the export volume continued to expand. The chain achieved growth, and the overall export situation remained positive. In September, China's textile and apparel trade volume was 25.98 billion U.S. dollars, an increase of 5.1% year-on-year, of which exports were 23.75 billion U.S. dollars, an increase of 4.3%. In the first nine months of this year, China's textile and apparel trade volume totaled 217.86 billion U.S. dollars, an increase of 0.3% year-on-year, of which exports accounted for 97.78 billion U.S. dollars, a decrease of 0.1%. In October, China's textile and apparel trade volume was 23.68 billion U.S. dollars, an increase of 1.9% year-on-year, of which exports were 21.68 billion U.S. dollars, an increase of 1.2%. From January to October, the trade volume of textiles and garments amounted to 241.54 billion U.S. dollars, an increase of 0.4% year-on-year, of which exports were 2214.6 billion U.S. dollars, down by 0.01%, which was basically the same. In November, the total value of textile and apparel exports nationwide was 23.115 billion U.S. dollars, an increase of 8.02% over the same period of last year, and 6.7 percentage points higher than the growth rate of the previous month. Among them, textiles exported 9.989 billion U.S. dollars in the current month, an increase of 11.31% year-on-year; apparel exported 13.126 billion U.S. dollars in the month, an increase of 5.65% year-on-year. From January to November, the total export volume of textiles and garments nationwide was 243.257 billion U.S. dollars, an increase of 1.57% over the same period of last year. Among them, total textile exports totaled 97.786 billion U.S. dollars, an increase of 4.02% year-on-year.
According to the above data, it can be predicted that in 2017 China's textile and apparel exports will achieve a slight increase, which is a significant improvement over last year.
Trend 3
"Black Swan" incident triggers a knock-on effect
In January of this year, Trump officially sworn in as president of the United States. Since he took office, he has been actively implementing the New Deal and has been performing many actions. In order to implement its policy of returning manufacturing to the United States and reducing foreign trade deficits, Trump signed an administrative memorandum in August, authorizing U.S. trade representatives to decide whether to initiate a “301 investigation†on the so-called “unfair trade practices in Chinaâ€. After the “surrogate country†approach continued to be applied in anti-dumping investigations against China, the Trump administration formally informed the World Trade Organization (WTO) in November that the United States is opposed to China’s gaining market economy status. In December, the first national security strategy report of the Trump administration came out, listing China as a "competitor." A few days ago, Trump also signed the largest tax cuts bill in the United States since 1986, and the bill will be implemented in January 2018.
After Britain initiated the Brexit program in March this year, the European Council officially approved the first phase of the negotiations between Britain and the EU, and announced that the EU agreed to initiate the second phase of the negotiations, with uncertainties increasing sharply.
According to the statistics of the General Administration of Customs of China, in October this year, China’s textile and apparel exports to the United States continued to grow at a rate of 2.9%. Among them, textiles and clothing increased by 9.2% and 0.6% respectively. In the first 10 months, it exported a total of US$37.89 billion to the United States, a slight increase of 0.4%, of which the export of needle-knitted garments increased by 2.5%. From the point of view of exporting countries, the amount of textiles and clothing exported by China to the United States accounted for approximately 16.6% of the total amount of textiles and clothing exported by China. According to U.S. Customs statistics, in the first 9 months, the United States imported 88.11 billion U.S. dollars of textiles and apparel from the world, of which China accounted for 36.2% of the market share. It can be seen that China's textile and apparel exports are relatively stable to the US market and have achieved a slight increase. Observing the export phenomenon with obvious growth recently, the outlook for China's textile and apparel export trade with the US is expected to expire. Moreover, the US tax cuts are beneficial to China's export-oriented enterprises in the short term, and the long-term benefits must be observed.
Despite the "301 investigation" move that triggered all walks of life to the United States to take unilateral action to damage Sino-US economic and trade relations concerns, but textiles have not become the main objective of this year's Trump government trade investigation, partly because the Sino-US textile trade is two-way. In the past 10 years, China’s total exports of textiles to the United States have grown substantially. China is now the fourth largest market for US textile exports. In addition, in 2016, bilateral trade volume between China and the United States reached US$524.3 billion, an increase of 209 times over the beginning of the establishment of diplomatic relations; bilateral trade in services exceeded US$110 billion; and two-way investment accumulated more than US$200 billion. At the same time, from 1980 to 2016, the total amount of US-related trade remedies against China during the 36 years was less than US$30 billion. The comparison between the two groups of data has clearly demonstrated that the economic and trade exchanges between China and the United States are the mainstream of cooperation and win-win cooperation.
Since the fourth quarter of last year, China’s textile and apparel exports to the UK have begun to decline. This year, my exports to the UK continued to decline, with a cumulative decrease of 9.7% in the first three quarters. On the contrary, in the last two months, China’s exports to the EU have continued to grow slightly, with a year-on-year increase of 3.5% in October, of which textiles grew by 5.6%, and apparel has resumed a 2.7% increase after four consecutive months of decline. However, the foundation for EU growth is still not solid, and whether the growth momentum can be maintained remains to be seen.
Trend 4
Accelerating the pace of corporate mergers and acquisitions
This year, China’s textile backbone enterprises have noticeably increased their awareness of the initiative in international deployment, and have built a new international competition by investing in upstream and downstream quality resources, advanced research and development capabilities and technologies, and end-channels in the industrial chain. Advantage. Businesses investing overseas to cooperate have avoided trade barriers and reduced production costs. On the other hand, they have built the company’s marketing network, logistics channels and R&D center into the international market for product sales, through production, R&D, logistics, distribution, The optimal allocation of resources in all aspects of marketing has effectively integrated the international and domestic markets.
News Review More than 20 Chinese textile companies represented by Sunshine, Huafang, Lianfa, Wuxi No. 1 Cotton, Wuxi Jinmao, and Guangdong Huida successively signed a memorandum of understanding or formal agreement on investment cooperation with Ethiopia. Some projects have already landed; Tianhong, Baihe The cotton textile investment of Longdong Orient, Huafu Textiles, Youngor, Luthai, Xindadong, and Yulun has totaled more than 2.5 million spindles in China; the large-scale knitted apparel companies such as Shenzhou International, Jifa and Dongdu have been basically established. The domestic and Southeast Asian countries have close cooperation with production capacity; in France, Italy, Australia, the United States, Canada, New Zealand and other countries and regions, Chinese textile companies take the initiative to integrate high-quality resources in the global industrial chain, such as Jiangsu Tianyuan’s intelligent production of garments. , successfully entered the United States.
In particular, it is worth mentioning that Shandong Ruyi Group continued its massive acquisitions this year. In March this year, the British brand Aquascutum was sold to Ruyi for US$117 million. In October, Ruyi signed a definitive agreement to acquire Invista, a US-based polymer and fiber supplier, and premium fabrics, including the well-known Leica business. In November, Ruyi again acquired a 54% stake in Israel’s Bagir, a controlling shareholder of the Israeli menswear group, for $16.5 million. This relatively large company with a relatively complete textile and apparel industry chain is extending its global reach more and more. The merger and acquisition road allowed Ruyi to further integrate global quality resources and quickly expand its international industrial layout.
Trend 5
Industry actively responds to frequent trade frictions
In the situation where foreign trade has stabilized and pick up, this year's textile and garment industry in China is also facing a severe trade friction situation. Judging from the form of trade remedy cases, it further presents a trend of diversification. In addition to the traditional anti-dumping investigations, both anti-counterfeiting and anti-circumvention cases are involved. In the past, most of the countries that initiated trade remedy cases used anti-dumping or anti-subsidy measures alone, and now they are used simultaneously. In other words, the use of trade remedy by developed countries has become more mature, and developing countries have actively followed up and applied these measures from laws, legislation, and government agencies. This poses a higher demand for the professionalism of Chinese textile companies in response. . It should be noted that the negative impact of international trade protectionism will persist for a long time. Developed countries and emerging economies will double squeeze China’s foreign trade exports.
News Review In the first half of 2017, China’s textile industry experienced 8 new trade remedy cases and 2 early-warning cases involving the United States, India, Colombia, Turkey and many other countries and regions. The number of cases increased by 33% compared with the same period of last year. The new case involved nearly 430 million U.S. dollars. Early warning cases involved nearly 1.07 billion US dollars. In the first half of the year, China's textile industry encountered several salient features of its trade remedy cases. First, India reentered the period of high incidence of cases. Of the eight cases in the first half of the year, 6 were from India. The amounts involved in the anti-dumping investigation of man-made fiber fabrics in early-warning cases amounted to 950 million U.S. dollars, which had a greater impact on the export of enterprises; second, the case of the United States returned to the rivers and lakes. In recent years, the sponsors of cases in the textile and apparel industry have been concentrated in developing countries. However, in the first half of this year, the United States launched a double-counter investigation on polyester staple fiber. It is the first time that it has initiated a preliminary investigation on the textile and clothing industry after six years, and the development trend behind it deserves attention. Third, the concentration of chemical fiber products is involved in 10 cases. There were 8 chemical fiber products in the case. They were: polyester staple fiber 2, artificial fiber, polyester filament yarn, acrylic fabric, viscose filament yarn, partially oriented yarn (POY), and high-strength yarn. . In particular, polyester staple fiber products are the hardest-hit areas for trade remedy investigations.
In the second half of the year, the Ministry of Commerce and Industry of India issued an announcement on August 23, initiating an anti-dumping investigation against Belting Fabric. On October 27, the Indonesian Anti-Dumping Committee (KADI) decided to initiate an anti-dumping investigation on the polyester yarn (SpinDrawn Yarn) that I exported to Indonesia. In November, a total of 52 cases of textile and footwear products were recalled in the United States, Canada, the European Union, and Australia, of which 19 were related to China. Although trade remedies cases encountered by the industry are showing multiple trends, it is gratifying to note that in recent years, as the four-body linkage response mechanism led by the Ministry of Commerce has matured, corporate enthusiasm for responding has increased. With the active cooperation of all parties, the cases were controlled to the extent that it had the least impact on the export of Chinese enterprises. Through the relevant agencies of the industry, they actively contacted importers and downstream industries to establish defense alliances, thereby maximizing the favorable results.
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