Looking back on 2022, changes are accelerating on a global scale, the economic and trade environment is turbulent, and textile and apparel foreign trade is under pressure under the impact of multiple unexpected factors… For textile people, 2022 is destined to be an extraordinary year. Frequent missed appointments in the “traditional peak season” have caused the textile and apparel market to perform calmly throughout the year.
The data is released, and the trend of textile and clothing exports is “high at first and then low”
According to the latest data from the General Administration of Customs, my country’s textile and apparel exports reached US$323.34 billion in 2022, a year-on-year increase of 2.6% (a year-on-year increase of 5.9% in RMB), setting another record high. Among them, textile exports were US$147.95 billion, a year-on-year increase of 2.0% (a year-on-year increase of 4.9% in RMB); clothing exports were US$175.40 billion, a year-on-year increase of 3.2% (a year-on-year increase of 6.7% in RMB).
It can be seen from the trend throughout the year that the export growth rate of the textile and garment industry in 2022 will show a trend of “high at first and then low”. Since the third quarter, pressures such as sluggish foreign trade orders and weak overseas demand have gradually been released, and the growth rate of textile and apparel exports has shown a downward trend. By the end of the fourth quarter, my country’s textile and clothing exports both recorded double-digit negative growth.
This year, textile people lamented that foreign trade orders have declined severely. This cold wind blowing from the United States and Europe has quickly cooled down the originally bustling foreign trade market!
In order to reverse this situation, after the epidemic prevention and control has been optimized again, foreign trade companies either prepare and set off on their own, or join the “charter flight order grabbing group” organized by the government and travel to various parts of the world to make up for the business opportunities and orders lost in the past three years. What is gratifying is that this overseas purchase has achieved remarkable results, and many companies have returned “fully loaded”, laying a good foundation for the start of 2023.
Affected by the global economic slowdown, factors such as declining demand and shifting orders are difficult to change in the short term. It is expected that in the first half of 2023, textile and clothing exports will still face greater pressure.
News spreads frequently, and the foreign trade market has mixed joys and sorrows at the beginning of the new year.
At the beginning of the new year, there is an endless stream of news related to the foreign trade market. In the eyes of foreign trade people, it can be described as “one wave after another”!
First, the RCEP agreement officially came into effect for Indonesia. According to reports, starting from January 2, China and Indonesia will implement the RCEP agreement tax rates on each other. Under RCEP, Indonesia has added zero-tariff treatment to more than 700 products under my country’s tax code on the basis of the China-ASEAN Free Trade Area, including some auto parts, clothing, footwear, and plastic products. This is undoubtedly a major benefit for foreign traders. After all, Indonesia is my country’s third largest trading partner in ASEAN, second only to Vietnam and Malaysia.
What followed was that the RMB exchange rate soared by 3,400 points at the beginning of the year! Such a rate of appreciation will really break the mentality of many foreign traders who have not yet settled foreign exchange. In just a few days, profits of about 2 points evaporated without a word. How to avoid exchange rate risks may become a required course for most foreign traders in 2023. You can’t just “leave it to fate” when settling foreign exchange, because exchange rate risk does not lie in the moment you get the balance payment. It occurs earlier in the period from when the foreign trade enterprise signs the contract to the completion of production and receipt of the balance payment.
Immediately afterwards, news came out in the shipping market that “sail suspensions increased sharply and freight rates entered a cold winter.” As the Spring Festival holiday approaches, my country’s export container shipping market has not seen a small peak in shipments before the holiday. Freight rates in most ocean route markets have declined, and the freight index has fallen to the breaking price! Affected by weak demand, shipping companies have canceled more than seven times the number of sailings on the Asia-US West Coast route than the same period in 2019! Some relevant people even lamented that the prospects for Asia-Europe routes are “dire” and they have never seen such sluggish demand in many years of experience.
Postscript:
Even in the difficult year of 2022, textile and clothing exports can still maintain positive growth at the end, which is enough to show that my country’s foreign trade has extremely strong resilience! In the new year, challenges and opportunities coexist. With a series of policy support, the foreign trade market may usher in an inflection point! let us wait and see…
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