Can the abolition of textile quotas save export decline?

Recently, the Ministry of Commerce announced that starting from January 1, 2009, the quantity and license management of textile exports to the United States and the management of textile export licenses to Europe will no longer be implemented. This means that from 2009, China’s textile exports will no longer be subject to quota restrictions. But the industry’s response has been lukewarm. Zhang Weifeng, manager of the foreign trade department of Zhejiang Textile Group Import and Export Co., Ltd., believes that the recent global financial crisis has weakened the United States’ ability to pay, and even if quota restrictions are lifted, it will be difficult to change the downward trend in exports.
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In the short term, the Ministry of Commerce has made two policies for textile exports: starting from August 1, 2008, the export tax rebate rate for some textiles and clothing will be increased from 11% to 13%; starting from January 1, 2009, textile quotas will be cancelled. limit. The introduction of these measures has a very obvious meaning of “promoting exports and maintaining growth”. Overall, the role these favorable policies can play is limited. The current trend of declining exports of my country’s textiles and other products and slowing economic growth has been established, and it will be difficult to reverse the upcoming increase in the export tax rebate rate or the removal of quota restrictions.
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As we all know, as the U.S. subprime mortgage crisis spread from the financial sector to the real economy, U.S. textile consumption began to decline, which will directly affect my country’s textile exports to the United States. At present, my country’s textiles account for nearly 30% of the U.S. market, and the decline in demand for U.S. apparel products directly affects my country’s textile and apparel exports. According to relevant statistics, in the first half of 2008, the United States imported US$32.997 billion in clothing from the world, a decrease of US$1.389 billion, or 4.04%. Among them, US$583 million of the decrease came from the Chinese market, accounting for 41.97%.
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Although my country’s elimination of export quotas will increase the amount of textiles exported to the United States, textile export companies may still encounter U.S. trade barriers. It is further inferred that various trade protection measures such as various non-tariff barriers, anti-dumping, and regional trade alliance systems in the United States may hinder the normal development and export of my country’s textile industry. Especially with the expiration of the Sino-US textile agreement at the end of 2008, my country’s textile exports may once again cause a chaotic situation of increasing volume and decreasing prices, and this situation will continue for at least the next 1-2 years. The United States is likely to take advantage of Special safeguards, anti-dumping and other means impose restrictions on my country.
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For example, in addition to using the Anti-dumping Law and “Section 201” to impose restrictive measures on Chinese textiles, the United States can also resort to “special safeguard measures” that only target Chinese companies. It is understood that this is a special textile protection agreement signed by my country and the United States when China joined the WTO. In November 2007, based on this agreement, the US government announced that it would target Chinese-made knitted fabrics, bras, Special restrictive measures are implemented for 3 types of robe products.
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Since 2008, the United States has also continued to raise its threshold for textile and apparel imports. Following the toy recall incident in 2007, the United States has recently frequently used recall mechanisms for Chinese textiles and clothing. In the first half of 2008 alone, the United States announced 12 recalls of Chinese textiles and clothing through its Consumer Product Safety Commission. Under the new situation, simply looking at the U.S. market, the financial crisis has caused the U.S. market to enter recession, which will inevitably lead to the rise of trade protectionism. Then, my country’s textiles exported to the United States will face the threat of shrinking of the U.S. market on the one hand, and also have to Facing the threat of trade remedy measures.
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Chen Lipeng, director of the Fair Trade Bureau of the Guangdong Provincial Department of Foreign Trade and Economic Cooperation, said that in order to prevent the rapid growth of my country’s textile exports, the United States may adopt trade remedy measures or technical barriers to set up obstacles for Chinese companies, and there are already signs of this. According to the data currently available, my country’s textile exports to the United States have declined for five consecutive months. It remains to be seen what changes will occur in the future. However, if the United States still uses “volume surge” as a reason to request restrictions, the reduction in exports to the United States will The possibility remains.
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In fact, although the United States claims to be a complete market economy country and implements complete trade liberalization, the so-called trade liberalization is not completely free. In recent years, Chinese companies’ exports to the United States are still subject to many non-tariff trade barriers, such as anti-dumping and countervailing restrictions. . Therefore, even if my country lifts export quota restrictions, textile companies must pay attention to market diversification and not pin all their hopes on the US market. The author believes that as U.S. consumption weakens and market risks increase, textile companies should not forcefully do business with U.S. companies.
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It is worth noting that after the Ministry of Commerce canceled textile export quotas, it put all companies on the same starting line. This seems fair, but in fact, the operating costs of large and small companies are not equal. In this way, some small businesses may compete for U.S. orders with lower quotes, thus disrupting the market.Experts in the industry are worried about this, so some experts suggest that textile export companies should prevent low-price competition, and the industry must be united and cannot lower each other’s prices and engage in price wars. In the end, it is the companies themselves that suffer from this vicious competition.