According to the consensus reached at the Argentine meeting between the two heads of state, China and the United States decided to stop upgrading trade restrictions such as tariffs, stop raising existing tariff rates against each other, and refrain from imposing new tariff measures on other commodities. Washington has also decided to postpone the imposition of punitive tariffs on $200 billion of Chinese goods after Beijing announced a suspension of tariffs on American-made cars in the first three months of next year, AFP reported Wednesday. The U.S. Trade Representative's office officially raised tariffs on China's $200 billion products from 10% to 25% in the Federal Gazette on March 14 to 12:01 p.m. on March 2, 2019.
During the 90-day ldquo; truce rdquo; the economic and trade teams of the two sides will actively promote the consultation work in accordance with a clear timetable and road map. However, China's textile and apparel export enterprises face the current situation, but dare not take it lightly.
There is still a time lag for order recovery.
Since September 24, the United States has imposed a 10% tariff on $200 billion of goods from China. The list contains 5745 taxable products, involving 917 items of textile industry, including all kinds of textile yarns, fabrics, industrial manufactured goods and some household textiles. The annual export volume of these products exceeds US$4 billion.
With the escalation of Sino-US trade frictions, since August, many fabric manufacturers who have trade relations with the United States market began to stop. In Nantong, Jiangsu, a trader who mainly exports home textile fabrics to the U.S. market admitted that orders in the U.S. market fell by 30% in the second half of this year compared with the same period last year.
According to the report on the results of the 124th Canton Fair, which ended recently, the number of U.S. buyers decreased by 4.07% compared with the same period last year, while the volume of China's exports to the U.S. dropped by 30% compared with the same period last year to 2.79 billion U.S. dollars.3%, a large decline. Thus, the tariff imposition on China initiated by the United States is profoundly affecting the trend of bilateral trade.
The head of a small and medium-sized textile and apparel trade business from Shanghai said that it would be time-consuming to cancel the tariff increase, and the market reaction would not be so fast. However, the suspension of tariff increase could give enterprises a breathing space. Now, enterprises are stepping up their efforts to cope with the 10% tariff allocation problem with American buyers and Chinese producers in order to stabilize the number of existing orders exported to the United States. Quantity. However, with a 10% tariff, profits will be lower, and companies will not expand or expand their export business in the U.S. market in the next step.
The head of a garment trader from Jiangsu Province to the United States believes that although tariffs remain at 10% which makes the pressure on enterprises to export to the United States less, the positive impact of this easing is lagging behind. The person in charge said that the next step would be to transfer to Southeast Asian countries as part of the return flow of clothing orders. Although re-export to Southeast Asia can avoid the risk of tariffs on the United States, the supply of ground materials is relatively scarce compared with the Chinese market, which has a considerable impact on organizational production.
Uncertainty Risk Should Be Careful
The enterprises interviewed generally believed that despite the friction in Sino-US trade, the dependence of the two sides on textile and apparel trade was very high: China was the largest source of textile and apparel imports from the United States, & ldquo; Made in China, & rdquo; high cost-effective and difficult to replace.
However, the enterprises interviewed also said that the US foreign trade policy towards China has been volatile for more than half a year, which does not exclude the possibility of reversal and deserves vigilance. A processing company in Ningbo, Zhejiang, said that American businessmen who have cooperated with their own enterprises for many years have the misgivings of placing orders and think that the United States itself has too many variables. As a result, the Ningbo textile company did not increase its orders for exports to the United States in case the other party repented. He said that enterprises are considering broadening the direction of international market development and looking for business opportunities in other developed countries. For example, from next year, in bilateral trade between China and Australia, almost all goods will enjoy zero tariffs, which is an opportunity for China's foreign trade textile and apparel enterprises.
Some experts reminded enterprises that they should treat the recent positive changes in Sino-US trade policy with an ordinary mind. During the next negotiation period, new twists and turns will not be ruled out. While striving for the best results, they must prepare for the worst. Textile and apparel exporters in the United States should not take it lightly, but must make a long-term plan.
Potential Opportunities for Import Trade
China and the United States have stopped escalating tariffs and temporarily eased trade frictions, which can restore to a certain extent the price competitiveness of Chinese textile enterprises'export products, or at least restore the quotations for exports to the United States. However, enterprises are deeply aware that it is not advisable to wait for tariff preferences to ensure export share. The head of a small-scale innovative textile enterprise in Beijing believes that enterprises can not resist any risks without innovative products. They must have irreplaceable ldquo, hard goods rdquo and occupy the American market.
Some textile enterprises said that not only products should be irreplaceable, but also the foreign trade model should be transformed and upgraded. It is urgent to change the old and new kinetic energy. Only by adhering to high-quality development, focusing on product independent innovation, adjusting and optimizing product structure, and strengthening the balanced layout of the global market, can Chinese textile enterprises gain a firm foothold in the changeable competitive environment of world trade, and thus win the initiative and voice of the international market.
In addition, China's domestic market has broad prospects, textile and clothing foreign trade enterprises also have to look inside. Since this year, China's policy of actively expanding imports has landed, which has led to a relatively rapid increase in imports. Statistics from the Ministry of Commerce show that in the first 10 months of this year, the amount of imported goods increased by 15.5% compared with the same period last year, much higher than the growth rate of 7.9% in exports. Especially this year, China has introduced a series of new measures to reduce tariffs independently, and realized four tariff reductions, reducing the total tariff level from 9.8% last year to 7%..5%. In November this year, China also hosted the first China International Import Exposition in Shanghai, with more and more import space. China's economy is steadily improving, which also releases more import demand.
The marketing director of a Guangdong apparel export enterprise said: & ldquo; traditional export enterprises like us should take measures according to the time and wait for opportunities. However, there is a lot of work to be done in the transformation from export to import business, straightening out channels, dredging logistics and other links. ”
