Powerhouse of the global economy, China continues to increase the general economic outlook. However, the foreign trade of textile and apparel experienced a small decline in January – July 2012. According to customs statistics, China's foreign trade volume valued at USD 2.168.37 billion, increasing by 7%. Inspected closely, exports worth USD 1.131.24 billion, an increase of 7.8% ; imports worth USD 1.037.13 billion up 6.4%. Thus, China's economy had USD 94.11 billion trade surplus.
On a monthly basis, China's foreign trade amounted to USD 328.73 billion in July. Compared with the same period in 2011, this rate amounts to an increase of 2.7%. Exports valued at USD 176.94 billion, increasing by 1.0%, while imports valued at USD 151.79 billion, increasing by 4.7% in July. Foreign trade had USD 25.1 billion trade surplus in July. This figure indicates 16.8% growth compared with the same period in 2011.
Textile and Apparel Figures Decreased
China's textile and apparel exports declined by a small margin in the January – July period. Apparel exports amounted to USD 82.93 billion, decreasing by 0.2%. Textile exports also decreased by 0.2% and amounted to USD 54.47 billion. Analyzing July, China's situation is seen to have worsened. In July, textile and apparel exports amounted to USD 23.889 billion, decreasing by 8.1% compared with the same period last year, and increasing by 4.37% m/m. Besides, the export of textile products amounted to USD 8.002 billion, decreasing by 8.6%, while the export of apparel amounted to USD 15.887 billion, decreasing by 8.3%.
The Global Financial Crisis Affected Negatively
Providing goods for every part of the global market with cheap and large amounts of production, China is an open book for the fluctuations in markets. After the financial crisis, weak economic recovery, deteriorated employment structure, and high unemployment rate of the USA, Europe and other developed countries are argued to affect Chinese economy more strongly.
The negative growth trend of China's textile and apparel is shown as one of the direct results of the financial crisis in developed countries. The financial crisis limits the demand and restricts economic growth. It is clear that in the countries dominated by China in terms of export, China experiences declines. The growth of some countries such as India, Vietnam, Bangladesh in textiles is shown as a reason for China's decline.
According to Ministry of Industry and Information Technology of China , international economic situation will become much worse in the second half. Stressing that low international demand would continue, the authorities pointed out that textile enterprises would still have difficulty in the second half. The continuation of this negative effect is stated to put many medium, small and micro-enterprises in a difficult situation.
Domestic Demand Regressed
Exhibiting a negative trend in foreign trade of textile and apparel, China experienced decline in domestic demand of this segment as well. Mr. Sun Huaibin, spokesman of China Textile Industry Association, remarked that in the first half of 2012, both overall demand and demand for textiles and apparel slowed down compared to the same period last year. The sector is expected to close the whole year with a little bit of growth.
According to the statistics in the first half of 2012, global textile and apparel imports by European Union fell 6.9%, 0% increase in the United States, and only 2.2% increase in Japan was noted. In general, a decrease of 10.8% is recorded. Because domestic cotton price in China has been higher than international market, cotton yarn manufacturers in China have experienced a serious decline of competitiveness. Mr. Sun Huaibin argues that the negative growth trend of China's textile industry is difficult to make a fundamentally reverse, as price trend of domestic and international cotton is not yet clear. In spite of this negative picture, Huaibin added that domestic demand would gradually pick up.
