Is China going to dominate the global textile trade?

Since quotas on textiles and apparel were lifted, textile imports from China to the USA have significantly increased. The quotas came to an end with the beginning of the new year. In January, textile and apparel imports from China to the US increased about 75 percent. Now people fear that China is going to rule the global textile and apparel trade and increase already existing trade tensions around the world. In the US thousands of jobs are at risk, in January for example, 12,200 jobs were lost in the apparel and textile industry. With the continuing increase in imports, Americans fear that manufacturing plants in the US will be closed and even more jobs getting lost. Before the quotas were lifted, 16 percent of clothing in the US was imported from China. Analysts predict that number to go up to 70 percent in two years, increasing the existing trade deficit with China. The trading imbalance is the largest that the US has ever had with a single nation.

Poor countries like Sri Lanka, Cambodia and Bangladesh now desire to achieve what China has achieved to make a better living. These countries are now pressing Washington to also lower the tariffs on the imports from these countries to become even more competitive producers.

The question is whether this is going to last. Even though consumers are benefiting from lower clothing prices, the trade balances are troubled. Can the US handle China’s textile and apparel flood?

The Article can be seen here.