Shanghai, China
Chinese textile factories have witnessed a sudden dip in production recently. This comes as a surprise as most Chinese textile factories had recorded a surge in production last year while other countries were bogged down by the COVID pandemic.
Experts attribute the fall in the Chinese export volumes to the improving economies in other Asian countries, the increasing cost of labour in China and overseas clients refusing to stockpile products in advance.
China exported $22 billion worth of yarn, fabric and textiles in January and February. However, in March, it managed to export only $9.7 billion worth of goods. Similarly, the country’s textile exports grew by 60.8% in January and February, while the growth percentage came down to 40.3% in March.
The main reason for the slowdown is the fact that countries like Vietnam and India, where economies were badly hit by the pandemic last year, are starting their machines again now.
In March, Vietnam’s textile and garment export increased to 15.3%. Ouyang Hong, General Manager, Suzhou Jingzhi Textile Technology Co and Suzhou Yunzhilan Textile Technology Co, recently mentioned that the Southeast Asian garment industry is rising again and is taking business away from the Chinese industries. According to Ouyang Hong, the cost of labour in countries such as Vietnam is lower than in China. Also, they can handle low-end production better, posing a challenge to China.
The Chinese garment companies plan to focus on domestic markets to support their business. Before the pandemic, only 5% of orders came from domestic sources while now it has increased to about 30%. Ouyang also mentioned that the inventory was limited last year because of the pandemic and they hope to receive more orders from the clients this year.
Source: Global Times
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