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In the first half of the year, garment exports increased 16% year-on-year
In the first half of this year, China’s textile and apparel exports showed a positive growth trend, with garment exports reaching $53.23 billion, up 16% compared to the same period last year. Meanwhile, textile yarn, fabrics, and related products saw an even stronger increase of 32.3%, indicating a robust performance in the sector. This growth aligns with broader expectations for China's export outlook in 2010.
According to officials from the China Chamber of Commerce for Import and Export of Textiles, it is anticipated that apparel exports will perform better than in 2009, potentially reaching around $120 billion, with a projected 10% increase. The recovery of global economies, especially in the U.S., EU, and Japan, as well as the gradual economic rebound in emerging markets, are key drivers behind this growth.
Data released by the General Administration of Customs further supports this view. China’s trade with the EU reached $219.42 billion, up 37.2%, while trade with the U.S. hit $171.99 billion, rising 30.2%. Trade with Japan also increased significantly, reaching $136.55 billion, a 37% rise. Notably, Brazil has risen to become China’s tenth largest trading partner, with bilateral trade reaching $26.39 billion, an impressive 60.3% increase.
Despite these positive trends, the textile and apparel industry still faces several challenges. First, rising raw material prices threaten to narrow profit margins. With cotton and other key inputs becoming more expensive, companies are under pressure, especially as external demand remains uncertain. Additionally, the overall cost of production factors such as water, electricity, coal, and oil is also increasing, further squeezing corporate profits.
Second, international trade protectionism is on the rise, leading to more trade disputes. Countries have implemented various measures, including safety, health, environmental, anti-dumping, and anti-subsidy policies, to protect domestic industries. This has resulted in increased trade barriers against Chinese textiles. In 2009 alone, over a dozen cases were filed against Chinese textile exports, with significant financial implications.
Third, the appreciation of the Renminbi (RMB) poses a challenge for exporters. While the RMB remained stable in 2009, helping maintain export competitiveness, the growing trade surplus and China’s rising global economic influence have brought renewed attention to currency appreciation. For low-margin industries like textiles, this could be a major test of resilience.
Lastly, labor costs are steadily rising. Labor shortages have become more widespread, affecting not only traditional manufacturing hubs like the Pearl River Delta but also regions such as the Yangtze River Delta and provinces like Anhui and Jiangxi. Companies are responding by raising wages and improving working conditions to attract workers. However, the era of cheap labor is coming to an end, and the industry must adapt to new realities.
In conclusion, while the textile and apparel sector continues to grow, it must navigate a complex landscape of rising costs, trade barriers, and shifting labor dynamics. Exporters need to prepare for these challenges and develop strategies to remain competitive in the global market.