The Trans-Pacific Partnership Agreement will change the “rules of the game” for the U.S. textile and garment industry. Vietnam’s participation in the TPP is a major threat to the U.S. textile industry, but the latest research shows that the United States should be more worried about Japan’s joining.
During the negotiation process of the TPP agreement, textiles have always been a controversial issue. For the US textile industry, Vietnam’s accession is a major issue. Among the 12 TPP negotiating countries, Vietnam is the largest supplier of garments to the United States after China. What is worrying is that the TPP agreement will not only allow Vietnam’s garment exports to enjoy zero-tariff benefits to the United States, but if strict “starting with yarn” origin regulations are not implemented, these garments will be made of yarn and fabrics from mainland China.
A new study shows that Japan is a manufacturer of high-end textiles and industrial fabrics. Once the TPP agreement is implemented, it will bring greater challenges to the US textile industry. “Quantitative Assessment – Is Japan’s entry into the TPP an opportunity or a threat to the U.S. textile industry?” written by an assistant professor in the Department of Textile and Fashion Marketing and Design at the University of Rhode Island. “The report points out that as the world’s major textile exporter, Japan’s joining the TPP will greatly reduce the opportunities for the US textile industry to expand exports to the Asia-Pacific region. Vietnam’s import of textiles from Japan will significantly enhance the price competitiveness of its garment exports to the global market. In addition, the large amount of ready-made garments imported by the United States from Vietnam will significantly reduce the market share of ready-made garments made in NAFTA and CAFTA regions in the United States, thereby damaging the regional production and trade layout of textiles and garments in the American market. Vietnam’s close cooperation with Japan may help strengthen the productivity of its textile industry, turning Vietnam from a net textile importer to a net textile exporter. Under the above circumstances, even if there are strict “starting from yarn” origin regulations, the US textile industry may not be able to compete. Research reports show that even in the domestic market of the United States, the U.S. textile industry is facing increasing competition from Japanese textiles.
