On June 1, the China-South Korea Free Trade Agreement was officially signed. After the agreement takes effect, more than 90% of the products of both parties will enter the zero-tariff era after the transition period. The initial text of the China-ROK Free Trade Agreement has 22 chapters, covering 17 areas, not only involving trade in goods, but also trade in services and investment. It is reported that this is the free trade agreement that China has signed with a foreign country so far, involving the largest volume of national trade and covering the most areas. At present, the scale of bilateral trade between China and South Korea has reached 300 billion US dollars. The establishment of the China-South Korea Free Trade Area will greatly stimulate bilateral trade. Experts predict that the trade scale will exceed 400 billion US dollars within five years.
Will the textile and apparel field benefit significantly from this? In this regard, the reporter interviewed relevant industry insiders.
Will the export situation turn from losses to profits?
There are reports that the South Korean government predicts that after the China-South Korea FTA comes into effect, South Korea’s gross domestic product (GDP) is expected to grow by 0.96% on the original basis in the next 10 years, and consumers will benefit from US$14.6 billion. Is this equivalent to the growth of Chinese goods in the Korean market after duty-free? How much share can textiles and clothing occupy?
Industry insiders said: “China’s textile and apparel exports to South Korea will definitely grow, but will there be a huge increase? I don’t think so. I can only say that the implementation of the free trade agreement will slow down the decline in China’s exports, or promote a slight increase in export data. , but it will not reverse the overall decline in China’s exports. There are two reasons. First, South Korea’s market capacity is limited. Although South Korea has good consumption potential, after all, the country’s population is only about 50 million. South Korea’s yarns, fabrics, The apparel industry is very developed, and it is not easy for Chinese products to find accurate positioning in the country’s market. Second, China’s exports of textiles and apparel already occupy a high market share in South Korea, and there is limited room for improvement. Around 2007, China Textiles and clothing account for about 80% of South Korea’s total textile and clothing imports. This data should have declined in recent years, because many Korean clothing companies set up factories in China at that time, and the clothing they produced in China and returned to South Korea for sale was also included.”
Industry experts also said that instead of expecting a substantial increase in China’s textile and apparel exports, it is better to try to achieve cooperation and integration of the textile industries of China and South Korea. “For example, Chinese printing and dyeing companies have always had many problems, while Korean printing and dyeing is relatively good. If Chinese garment companies can cooperate with Korean companies in this regard and move the printing and dyeing process to South Korea, many problems can be solved.” In addition, he He said that whether it is based on South Korea’s consumption power or China’s high production costs, Chinese clothing companies should and can only enter South Korea’s mid-to-high-end market.
A large number of “Dongdaemun” clothing pour into China?
Nowadays, the purchasing agent industry is blooming around the world. In fact, most Chinese consumers first came into contact with purchasing agents from Korean clothing purchasing agents. The exquisite designs of Korean clothing have won the favor of Chinese female consumers. As early as before Handu Clothing House entered China, Dongpiao, small clothing retail stores, and buyer stores began to sell Korean clothing. However, the higher prices made consumers Those who stay away from it. People still cannot accept that buying a piece of clothing in a small store costs the same price as in a mall. With the development of purchasing agents, Chinese consumers have become aware of Dongdaemun, a famous clothing purchasing location in Seoul, South Korea. In addition to branded clothing, clothing produced in South Korea is no longer a myth, but is synonymous with high quality and low price.
However, purchasing on behalf of others is not the best option. In addition to the cost of clothing, consumers also have to pay a purchasing agent fee. In addition, consumers are very dependent on the buyer’s vision and need to wait for many days to get the goods. Chinese consumers have always been eager to know the latest trends in Korean clothing at any time without going to South Korea or looking for purchasing agents.
With the official signing of the China-ROK free trade agreement, people can’t help but ask: Will “Dongdaemun” clothing flood into China in large quantities?
Industry professionals said that after the formal implementation of the China-South Korea Free Trade Agreement, the bilateral trade in textiles and apparel between China and South Korea will increase in both quantity and quality, and the trade methods will become more diversified. Both China and South Korea have strong comparative advantages in textile and apparel trade. The final change in trade volume will depend on the tax exemption and exemption provisions of the China-South Korea bilateral free trade agreement. “It will take at least 3 to 5 months for the China-South Korea Free Trade Agreement to be officially implemented. Both governments need time to go through the relevant procedures for the agreement internally. Since the official text has not yet been released, it is difficult to say how bilateral trade will change. . But based on current data, Korean fashion, especially youth clothing, will develop rapidly in the future. However, the two countries should not achieve 100% zero tariffs on textiles and clothing. If this will cause Chinese clothing companies to be affected Impact.” Industry insiders analyzed this.
Cross-border e-commerce is a key area
What is particularly noteworthy is that the China-South Korea Free Trade Agreement has a total of 22 chapters, and e-commerce is included in the agenda for the first time. Industry experts analyzed and pointed out: “Cross-border e-commerce is the area with the greatest development potential for China and South Korea in the future, and more Korean clothing will be “regular”Jun’s identity has entered the free trade zone as well as the Chinese market through e-commerce. ”
Since the beginning of this year, China and South Korea have had very frequent exchanges in the field of e-commerce. On May 13, Haining Picheng Company signed a “Sino-foreign Joint Venture Contract” with South Korea’s Liyue and Pimeng Investment in Haining City, Zhejiang Province, and planned to jointly invest in the establishment of a Sino-foreign joint venture to engage in the development of cross-border e-commerce platforms. From May 18th to 19th, Alibaba President Jack Ma went to Seoul, South Korea, to attend the launch ceremony of Tmall Korea Pavilion. At the same time, Baidu also announced a cooperation with South Korea’s Korea Trade and Investment Promotion Agency (KOTRA). The two parties will jointly promote the cooperation and development of Chinese and Korean enterprises in the field of business and investment through Baidu Tieba, Baidu Future Store and other platforms. This means that more Korean brands and products will have close contact with Chinese consumers through e-commerce.
Industry experts pointed out that frequent interactions in the e-commerce field are based on South Korea’s highly developed Internet industry and China’s “Internet +” development strategy. South Korea is one of the countries with the most developed Internet industry in the world. At the same time, the country has a very developed logistics infrastructure and a good business environment. Both large enterprises and small and medium-sized enterprises are very familiar with e-commerce and distribution business and have good technical and operational foundations. It is precisely for this reason that a number of Chinese Internet companies with considerable strength, such as Alibaba, Tencent, Baidu, JD.com, and Jumei Youpin, have flocked to South Korea to explore more possibilities in the bilateral trade market between China and South Korea.
