Composite Fabric,bonded fabric,Lamination Fabric Lamination Fabric News Vietnam joins TPP to steal more clothing orders from China

Vietnam joins TPP to steal more clothing orders from China



Negotiations on the Trans-Pacific Partnership Agreement (TPP) were successfully concluded on October 5. As one of the labor-intensive industries, many people in the domestic textile and apparel industry believe…

Negotiations on the Trans-Pacific Partnership Agreement (TPP) were successfully concluded on October 5. As one of the labor-intensive industries, many people in the domestic textile and apparel industry believe that if the TPP comes into effect in the future, the industry will be affected to a greater or lesser extent.
Analysts at the Shanghai International Cotton Trading Center told reporters that if the TPP takes effect, taking into account production costs and other issues, orders originally belonging to China will be transferred to countries like Vietnam. “Vietnam can win apparel market share from China and other non-TPP members.”
In fact, with the increase in domestic comprehensive costs, China’s clothing export business has been very difficult in recent years. In 2009 and 2010, 50% of the garments produced in the three major regions of the United States, Europe, and Japan were processed and produced in China, but the proportion has been declining in recent years. Taking Japan as an example, 80% of the country’s current clothing processing orders were in China in 2010, but in 2014, this proportion dropped to 65%.
The general view in the industry is that the TPP will stimulate further changes in global textile and apparel trade. China’s share of the US apparel market in 2010 was 39%, which fell below 37% in mid-2014, while Vietnam’s share of the US apparel market has climbed to more than 10%. “Vietnam (manufacturing costs) are already lower than China, and the tax exemption at that time may provide a tax reduction of 12% to 32%, which will have a huge impact.” Julia Hughes, president of the American Fashion Industry Association, said.
In fact, many powerful large-scale textile and garment processing companies in China have already “prepared for a rainy day.” Shenzhou International, one of China’s largest apparel exporters, is expanding its production footprint in Southeast Asia. This Ningbo company has established a factory with 10,000 people in Vietnam. The vertically integrated production model allows it to enjoy lower water, electricity and labor costs, as well as preferential local export tariffs, which buys transition time for the transformation and upgrading of domestic production bases.
However, despite this, many people believe that under pressure, improving technological content is the top priority for China’s textile and apparel processing enterprises. “The increase in labor costs and competition in overseas markets seem to have put pressure on enterprises, but in fact they reflect the growth of China’s middle class. While costs are increasing, the demand for high-quality products is also increasing.” Li Li Ran Ximeng, managing director of Da (China) Textile Instrument Co., Ltd., said, “So in such an environment, if a company can meet the higher needs of customers through higher automation and higher cost-effectiveness, it can Seize the opportunities. This will be a potential market that companies need to focus on in the future.”
In Ran Ximeng’s view, the current predicament is temporary and is the pain that enterprises under the new normal must experience in the transformation process from purely pursuing economic benefits to focusing on quality, efficiency and environmental protection. The biggest challenge facing China’s textile industry at present is not the squeeze from the external market, but how to seize opportunities and break through itself, that is, to improve its competitiveness by improving its own quality and efficiency.

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Author: clsrich

 
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