"China is the number one textile and clothing exporter to the world, producing more than 43.1per cent of global demand. As per the 13th five-year plan of Chinese Government for the year 2016 to 2020 period, China strategically is moving towards more value adding tech intensive products. The plan is to maintain traditional market share and to grow more on the high value adding product range. But real market data shows that the country is losing its export market drastically from 2015 in almost all product sectors in the textiles and clothing arena."
China is the number one textile and clothing exporter to the world, producing more than 43.1per cent of global demand. As per the 13th five-year plan of Chinese Government for the year 2016 to 2020 period, China strategically is moving towards more value adding tech intensive products. The plan is to maintain traditional market share and to grow more on the high value adding product range. But real market data shows that the country is losing its export market drastically from 2015 in almost all product sectors in the textiles and clothing arena.
Textile & clothing industry is too much stretched in China and there are eight major categories such as garment, cotton fabrics, chemical fabrics, wool fabrics, silk fabrics, knitted fabrics, textile machinery and bast fibre. Production capabilities of all categories T&C is unparalleled in the world. According to China Textile Industry Development Report (2014/2015), textile fibre production in China exceeded 50 million tonne, accounting for 54.36 per cent of world share. As much as 64.2 per cent of the world’s chemical fibres, 64.1 per cent of synthetic fibres and 26.2 per cent of cotton were produced in China. On the other hand, apparel production in China reached 29.9 billion units in 2014, which is 10.4 per cent higher from 2013. This massive production capacity of China is showing a clear view that very likely China will remain the top apparel-sourcing goal for world’s buyers.
Hi-tech gaining a stronghold
Total value of China’s exports of apparel and clothing accessories in the world was $147.79 billion in 2016, which was $162.35 billion in 2015 and $173.44 billion in 2014 and $165.04 billion in 2013, according to ITC (International Trace Corporation) data from World Trade Organization (WTO). This data clearly shows that Chinese apparel export was having sharp growth till 2014 and afterwards it is having sharp decline. In 2014, Chinese global apparel export was the highest ever and afterwards in two years, it has lost 14.79 per cent of its exports.
In March 2016, China’s Ministry of Industry and Information Technology (MIIT) released its development plan, the 13th Five-Year Plan for period 2016-2020, for the apparel and textile industry, where China itself is expecting a slower growth for the industry (growth rate was 8.5per cent in 2011-2015 whereas the plan set a 6-7per cent goal for next five-year). Similarly, fibre end-use ratio and annual labour productivity growth rate were set lower than previous plan. Making the T&C industry sustainable, the plan set a conservative target for energy and water consumption (per unit of industrial value added) and emission of total pollutants. At the same time, China set a target to build a more tech-intensive textile & clothing industry.
Investment scenario
Textile industry of China is shifting gears for several reasons such as higher costs of production and scarcity of a skilled labour force. Exports are on a decline but the sector still maintains its pole position in the world market. On the other hand, textile production in 2017 will continue to update with depreciation and the rise of cotton prices. However, whatever the export growth or decline is, China as a vibrant manufacturing country will surely maintain core value adding sustainable business portions in textile and apparel value chain. With great rise in domestic consumption, Chinese companies are becoming global giant day by day.
