According to U.S. media reports, on November 10, U.S. President-elect Trump met with Obama to discuss succession issues. Afterwards, U.S. Senate Majority Leader Mitch McConnell announced that the Obama Administration’s lead TPP plan for the Trans-Pacific Partnership Agreement “has been prematureâ€. .
The Obama administration also announced that it will not push the TPP to pass the Congress within its term of office. Since Trump himself opposes TPP, it can basically be concluded that TPP has died!
On October 5 last year, 12 countries including the United States and Japan reached the TPP (Trans-Pacific Partnership) agreement in the United States. The agreement reached a strong response in the country, because China did not join the TPP, some people think that the TPP is "kicking China's ass", that is, the United States and Japan to block and kill China, will have a catastrophic impact on China. In particular, Obama claimed that he could not allow China to formulate global trade rules. It also exacerbated many people's dissatisfaction and concern.
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If China has stayed outside the TPP, some of the industries have been transferred to TPP's member countries. For example, in the traditional human-intensive textile industry, mainland textile companies have already transferred spinning and fabric production lines to Vietnam. TPP may bring about employment reduction and industry loss in China's textile industry. The most compelling clause in the TPP regulations is “zero tariffâ€â€”TPP in principle requires all products to be cancelled when trade between member countries is required. Import duties.
In this sense, the conclusion of the TPP agreement is not a good news for the Chinese textile industry. As a country with a large textile origin, China will indeed be greatly affected. China's textile and garment export companies will therefore face more competition and difficulties.
For example, according to the TPP regulations, all processes and raw materials after the “start of yarn†textile product must be carried out within the TPP member countries in order to enjoy 12 domestic zero-tariff treatment.
Zhang Yansheng, chief researcher of China International Economic Exchange Center, said that this may force some textile companies to move factories from China to TPP countries. Zhang Jianping, director of the International Cooperation Office of the National Development and Reform Commission’s Institute of Foreign Economic Relations, said in an interview with the media that due to the reduction of tariffs, Vietnam’s textile and apparel products may be more competitive than Chinese products in the US market.
In July of this year, at the National Democratic Convention of the United States, there were representatives of “Don’t TPP†to protest Obama’s Asia Pacific policy.
Malaysian economists believe that Malaysia's trans-Pacific Partnership Agreement (TPP) with 11 member states including the United States, Canada, Japan, Australia, Brunei, Chile, Mexico, New Zealand, Peru, Singapore and Vietnam will help improve In foreign trade, the development of the North American market, export-oriented industries such as textiles, palm oil, rubber and furniture will benefit from exporters, but domestic small and medium-sized enterprises, indigenous and state-owned enterprises may become losers.
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Calm response! China and TPP five member states free trade
As the largest country with a GDP scale of 10 trillion U.S. dollars and trade in goods, the Chinese market is extremely important to all countries in the world and has become a partner that many countries cannot ignore. The TPP signatory countries, including the United States and Japan, cannot afford to abandon their economic and trade relations with China. Of the 12 TPP countries, 5 have reached FTA (Free Trade Agreement) with China, and 7 have participated in the negotiation of the "Regional Comprehensive Economic Partnership Agreement" including China.
In addition, China has accelerated the construction of a free trade zone and has gradually established a free trade network based on the periphery and the “Belt and Road Initiativeâ€. In September of this year, China successfully hosted the G20 Summit and became one of the major forces leading global governance. China initiated the establishment of the Asian Infrastructure Investment Bank. The starting camp includes 57 countries, covering Asia, Oceania, Europe, Latin America, and five continents of Africa. They all have extensive representation.
Therefore, regardless of the strategic intent behind the TPP, the trend of globalization will not be changed and any attempt to contain China will not succeed. As for the future development trend of TPP, we will continue to pay attention to and calmly respond to the premise of adhering to common development and mutual benefit.
Vietnam: The founder of the TPP agreement will postpone the approval of TPP
Since the accession to the WTO in 2007, Vietnam’s exports of textiles, fabrics and garments have grown rapidly. Vietnam became the world's eighth largest exporter last year, accounting for only one percentage of China's global exports. The labels of Made in Vietnam are being used more and more in ZARA, GAP, NIKE and other internationally renowned clothing brands. Vietnam has also become the most potential country in Asia to replace China's textile industry. From spinning manufacturing to garment manufacturing, especially with Vietnam and the United States signing the TPP agreement, Vietnamese garment exports to the United States, Japan, and South Korea expanded, and the US market was second only to China.
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The TPP will create more than 6 million jobs for the Vietnamese textile and garment industry by 2025. The amount of textile goods exported to the TPP market in Vietnam will account for 70% of the total amount of textiles exported to Vietnam. Once the TPP goes into effect, it hopes to export textile products to the TPP market. The amount will increase by 2 times. It is estimated that the amount of textile products exported to the United States by Vietnam will reach US$55 billion by 2025. The average tariff on textiles exported to the United States will be reduced from the current 17.5% to zero-tariff. Vietnam’s textile and garment industry will become the biggest winner after the TPP comes into force. .
According to a report by Reuters UK, Vietnam, which was originally considered to be one of the first countries to ratify the agreement, has postponed the approval process and said that it will make a decision based on the results of the US election. The report quoted Vietnamese sources as saying that in the next round of the Vietnamese parliament, which will be opened on October 20, the approval of the TPP is not on the agenda, "because the government's proposal to the Congress is incomplete." This means that Vietnam’s approval and adoption of the agreement will end as soon as November’s end of the US presidential election.
Vietnam’s “Youth Daily†quoted the chairman of the country’s parliament as saying that although Vietnam is a founder of TPP, it still needs to refer to and consider the approval status of other countries and the impact of the US presidential election on TPP. Relevant assessments will be made and decisions will be made after discussion.
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At present, textile companies are faced with difficulties in foreign trade orders and inventory pressure. At the same time, due to rising labor costs, fluctuations in raw material prices, and rising lending rates, China's textile industry will once again fall into the pattern of reshuffling. The export situation is not optimistic. On the other hand, the spread of cotton between China and the international market has continued to be too high, and the cotton cost of China's cotton spinning companies is at a disadvantage in international competition. Not only cotton spinning companies but also textile enterprises including downstream textile and garments are facing enormous competitive pressures. The cost of cotton is higher than that of the international market, which has long plagued the development of China's textile industry. Especially in the past six months, it has performed even more prominently under the rapid increase of other costs, which has largely led to the international competition in the Chinese textile industry. The force fell.
It is precisely because of this that Chinese textile companies such as Blum Oriental and Tianhong Textile had to defuse corporate dilemmas through the layout of overseas production capacity, and they “run away†and invest in Vietnam. After Vietnam and the United States have signed the "Trans-Pacific Partnership Agreement" (TPP), spinning, weaving, printing and dyeing of the main manufacturing processes are carried out within the member states, and export tariff reductions can be enjoyed. Tax-free treatment will further amplify the global competitiveness of Vietnam's textile manufacturing industry in the context of its low processing cost advantage.
However, with the failure of the TPP, Vietnam’s advantage will probably “never existâ€!
As Billy Orient’s chairman Yang Weixin said: Chinese companies “going out†can't just go running out of TPP, but “the market and customers let you go out and get it right.†He also reminded that Vietnam does not lack spinning Spinners, what is now missing are fabrics, knitting and printing and dyeing companies can go out next. However, Vietnam’s environmental protection requirements are strict and stricter than China’s. Wastewater must be 100% qualified to be discharged, so “the Vietnamese market has not been so good.â€
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