InternationalCurrent AffairsTrump Tariff War
US President Trump launched a tariff war against various countries to gain trade advantages, but after China retaliated with rare earth export controls, the US domestic industry operations also faced difficulties. For many Chinese manufacturers who rely on exports to the United States, the new wave of US-China trade war is undoubtedly another cold winter. Among them, many garment manufacturers are facing rising trade barriers and feel like they are"being sniped". They are forced to make the decision to abandon the US market.
The South China Morning Post (SCMP) pointed out that a businessman named Zhang, who runs a yoga clothing export business in Dongguan, Guangdong, said that since the US-China trade war intensified earlier this year, his business has suffered a series of major setbacks, and that"the impact of the new round of tariff strategies is far greater than in the past", catching export traders"off guard".
The report stated that in the early stages of the trade war, Ms. Zhang's company was still able to take advantage of the tariff-free regulations for small packages and supply goods to American customers on e-commerce platforms through transit in Vietnam, thus maintaining business operations. However,"just when we were gradually gaining a foothold and had the hope of doubling our profits, Trump imposed tariffs, which was like closing the door tightly."
According to estimates by Wall Street investment bank Morgan Stanley, the Trump administration has not only increased tariffs on Chinese goods sold to the United States by an average of 42% since April this year, but also canceled tariff exemptions for small packages. It has also put pressure on countries including Vietnam to strictly block Chinese manufacturers' common practice of"washing the origin".
In view of this, Ms. Zhang said that her long-term American customers have gradually stopped placing orders in the past two months, mainly to wait and see the policies of the Trump administration and wait for the opportunity to improve conditions. Although local governments in China have also responded by encouraging manufacturers to turn their focus to the domestic market, Ms. Zhang said that the sizes of Chinese ready-made clothes are often smaller than those sold to the United States, so the warehouses are still filled with a large number of large-sized items. Ms. Zhang is not an exception, and similar situations are widely occurring in the Chinese garment industry.
According to estimates by Professor Lu Sheng of the Fashion and Apparel Institute at the University of Delaware, the total value of clothing imported by the United States from China in May this year fell by 52% compared with the same period last year. Just a few years ago, China was still the largest source of clothing supply to the United States, but by May this year, China's garments accounted for a sharp drop to 9.9% of the total amount of finished garment imports to the United States, setting a record low in decades.
Even though the United States and China reached a consensus in May to suspend some tariffs, Luxembourg believes that given the unpredictability of Washington's future policies, many American fashion companies are planning to further reduce their dealings with China or even completely end their business in China.
Therefore, Chinese exporters are turning their attention to Europe and other possible alternative markets. According to statistics from the China Chamber of Commerce for Textiles and Textiles (CCCT), China's clothing exports to the EU region grew by 19.4% year-on-year in May. Ms. Zhang also said that she will focus on developing the European and Middle Eastern markets in the future.
