Composite Fabric,bonded fabric,Lamination Fabric Lamination Fabric News Liu Yaozhong: What does “One Belt, One Road” mean to the textile industry?

Liu Yaozhong: What does “One Belt, One Road” mean to the textile industry?



In March this year, the National Development and Reform Commission, the Ministry of Foreign Affairs and the Ministry of Commerce jointly released the “Vision and Actions on Promoting the Joint Constructio…

In March this year, the National Development and Reform Commission, the Ministry of Foreign Affairs and the Ministry of Commerce jointly released the “Vision and Actions on Promoting the Joint Construction of the Silk Road Economic Belt and the 21st Century Maritime Silk Road”, marking the official launch of the “Belt and Road” strategy.

So for the textile industry, what exactly can the “One Belt and One Road” bring to the industry? Liu Yaozhong, deputy director of the Trade and Investment Promotion Department of the Textile Industry Branch of the China Council for the Promotion of International Trade, believes that the “One Belt and One Road” will effectively reduce the impact of my country’s textile industry. The costs and political risks in the layout of neighboring countries can also be tapped into more trade potential, creating a favorable environment for the international growth of enterprises.

Where will the “One Belt, One Road” go?

The “Belt and Road Initiative” is currently very popular. Whether it is in TV media or online news, or in the development plans of various enterprises in various regions, it is often seen. However, for most people, it is always a smoke and mirrors. sense of ambiguity. It was not until the release of the “Vision and Actions on Promoting the Joint Construction of the Silk Road Economic Belt and the 21st Century Maritime Silk Road” at the beginning of this year that the “Belt and Road” had a clear outline.

The proposal and promotion of “One Belt, One Road” undoubtedly have major economic and political strategic considerations. So for China’s textile industry, especially many textile and garment enterprises, what they want to explore most is ultimately one question: “One Belt, One Road” “What exactly can it bring to the industry and enterprises?

Accelerate and optimize cross-border layout

Some people have suggested that the “Belt and Road Initiative” is the third reform and opening up after the special economic zones and WTO accession. The previous two times mainly brought capital in, but this time it is about capital going out, through international production capacity cooperation and interconnection. Interoperability coordinates the development of domestic and countries along the “Belt and Road”.

As various domestic production factors, especially human resources, reach bottlenecks, the production capacity accumulated by the domestic textile and apparel industry over the past thirty years must be proactively re-allocated rationally across borders based on the principle of regaining comparative advantage. In just a few years, Chinese-funded enterprises such as Texhong, Blum, and Huafu have invested nearly 2 million spindles in cotton spinning in Vietnam. Excellent enterprises represented by Shenzhou, Dongdu, and Youngor are also accelerating their clothing orders to Cambodia and Vietnam. Waiting for the transfer of ASEAN countries.

“China-Indochina” in the “One Belt and One Road” is currently where my country’s industrial capital investment gathers. The remaining areas include China, Mongolia and Russia, the New Eurasian Continental Bridge, China-Central Asia-West Asia, China-Pakistan, Bangladesh, China, India and Myanmar. The five major economic corridors, especially China-Pakistan, Bangladesh-China-India-Myanmar and China-Central Asia, also have abundant raw material resources and labor resources required for the transnational layout of my country’s textile industry. These all constitute potential areas for my country’s foreign investment.

In addition to specifying and guiding overseas investment areas, as the five core contents of the “One Belt, One Road” (i.e. policy communication, facility connectivity, unimpeded trade, financial integration and people-to-people connectivity) are promoted with the will of the country, my country’s textile industry has created a “One Belt, One Road” initiative. The comprehensive transaction costs, capital costs and political risks of the productivity layout model of “Mainland China + neighboring countries” will continue to decrease. The ultimate goal of the industry’s market-oriented global layout is to stabilize market share and increase profit margins to achieve continuous appreciation of industrial capital. The “One Belt, One Road” initiative is just like the east wind, which will greatly assist this process.

Exploring the potential of multilateral trade

“One Belt, One Road” will tap the potential of multilateral trade by accelerating the formulation of new trade rules and expand the consumer market of the textile industry chain and terminal links.

The world is currently in the era of post-WTO trade rules, and bilateral and multilateral regional free trade agreements are in the ascendant. If we look at the world trade map and the ongoing important FTA negotiations, in a sense, the trade integration within the “Belt and Road” region will effectively break the US Trans-Pacific Partnership Agreement (TPP) in the Pacific region and the US-European region. The Transatlantic Trade and Investment Partnership (TTIP).

 

When you open the map, you can see that the “Belt and Road” runs through the Eurasian continent, with the active East Asian economic circle at one end and the developed European economic circle at the other. The EU in the north and south of the Atlantic Ocean had a population of approximately 500 million in 2013 and a GDP of US$17.4 trillion, accounting for 23.3% of the world’s total GDP. The East Asian economic zone along the north-south line of the Western Pacific, including China, Japan, South Korea and ASEAN, has a population of approximately 2.15 billion and a GDP of US$17.9 trillion, accounting for 24% of the world’s total GDP. These two economic belts together account for 37% of the world’s population and 47% of GDP. There are 65 countries along the “One Belt and One Road”, including China, which traverse the two major economic belts from east to west, with a population of about 4.4 billion and a GDP of 21 trillion US dollars, accounting for 63% and 29% of the world’s total respectively. The total trade volume Accounting for only 1/4 of the world, there is huge potential for promoting economic development through trade and for promoting trade growth through economic development.

The China-ASEAN Free Trade Area is a model. Since its implementation in 2010, China’s textile and apparel exports to ASEAN have maintained rapid growth, from US$20 billion in 2011 to US$36.7 billion in 2014. At the same time, due to two-way tariff preferences, China’s textile industry’s investment in ASEAN countries has also increased.� has also grown rapidly, and the import of some products such as cotton yarn has surged. The “One Belt and One Road” will include more than 60 countries along the route in the construction of free trade areas. At present, the upgraded version of China-ASEAN Free Trade Area, the upgraded version of China-Pakistan Free Trade Area, the Regional Comprehensive Economic Partnership (RCEP), China- The GCC and the China-Sri Lanka Free Trade Agreement are both in the process of active negotiation.

The package of free trade agreements within the “Belt and Road” region will not only solve the problem of investment and trade facilitation, but more importantly, create an efficient and integrated market with convergent rules, which can significantly promote new growth points in trade. The layout of the textile industry’s manufacturing bases in the region and the market growth of textile clothing and textile machinery have far-reaching impacts. It is worth mentioning that the “One Belt and One Road” will also promote the depth and breadth of domestic integration and accelerate the formation of a truly efficient and unified domestic market through the modernization of infrastructure such as transportation, communications, electricity, water conservancy and integrated arrangements for customs clearance and other systems. and domestic-international markets.

Create an environment for the international growth of enterprises

As far as enterprises are concerned, the opportunities of the “Belt and Road Initiative” are reflected in creating a safe and stable economic and geographical environment for the international growth of enterprises, and providing a variety of higher-quality factor resources and their allocation guarantee system.

The safety of overseas investment has always been the primary issue that enterprises consider when “going global”. Various measures in the “Belt and Road” five links will effectively reduce political risks, reduce transaction costs, facilitate financing, and bring about better localized communication and management. The Chinese government and governments along the “Belt and Road” have jointly supported the establishment of more and more overseas economic and trade cooperation parks and industrial parks, which will also help textile companies improve implementation efficiency, reduce investment costs, and form industrial agglomeration advantages.

At the same time, with the signing of bilateral investment protection agreements and double taxation avoidance agreements between China and various countries, the safety of foreign investment and profit flow in the “Belt and Road” region will be more guaranteed. More importantly, with the realization of interconnection and large-scale infrastructure modernization, the orderly, rapid and free flow of financial capital, talent, labor, energy, raw materials and products in the region will greatly enhance the stability of the regional textile supply chain. The potential efficiency will be greatly improved, so that the feasibility of a single Chinese textile enterprise to carry out vertically integrated industrial chain operations and transnational allocation of production capacity in different countries in the region will be greatly improved.

Opportunities are valuable, but risks also exist. The interests of various countries are different, and the geopolitical and economic situation is also changing. After all, the grand vision of “One Belt, One Road” is not wishful thinking and an overnight success. Repeated setbacks and difficulties are real problems. The ultimate success can only be achieved through win-win interests between China and the countries along the route. Promote the realization of formal development. As a livelihood-oriented basic industry that has a very significant effect in creating national wealth and providing mass employment, China’s textile and garment industry is less likely to encounter resistance to its layout in the “Belt and Road” countries. Qualified enterprises should actively pay attention to the “Belt and Road” The latest progress is to seize the low-risk investment and market opportunities, give full play to the comparative advantages of cross-border resources and enjoy policy dividends, and realize the growth from local enterprises to international enterprises.

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