GENEVA – The removal of quotas on textiles and apparel has been a boon to China and India in 2005, according to data from the World Trade Organization.
China and India posted the largest growth in exports of textiles and apparel to the U.S. and European Union markets in the first nine months of 2005 compared with the same period last year. China’s exports to the U.S. increased 61 percent to $17.5 billion in the nine months following the removal of quotas on Jan. 1, 2005. China’s exports to the EU rose 46.1 percent to $21.8 billion.
It was a similar story for India, which saw exports of textiles and apparel to the U.S. grow 26 percent to $3.4 billion from January to September. Exports to the EU rose 18.1 percent compared with a year ago to $5.3 billion.
China and India’s surging export levels have not flooded the U.S. market as much as predicted, mainly because of safeguard quotas imposed by the U.S. on China that limited that nation’s import growth in many categories of apparel and textiles. U.S. textile and apparel imports during the first nine months of 2005 increased by only 8 percent compared with the same period a year ago. This indicates that a large share of the gains by China and India came at the expense of smaller exporting countries that have lost market share in the U.S.
High-income Asian economies such as Hong Kong, South Korea, Taiwan and Macao registered the biggest drop in exports to the U.S., posting a combined 21 percent decline to $5.9 billion. Other suppliers that posted declines in exports to the U.S. included Canada, down 8 percent to $2.1 billion; Mexico, down 6 percent to $5.5 billion; Turkey, also down 6 percent, to $1.2 billion, and the European Union, down 2 percent to $3.3 billion.
Poor sub-Saharan African countries also did not fare well, with combined exports to the U.S. falling 11 percent to $1.1 billion. CAFTA countries such as Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua witnessed a 2 percent decline in exports to $6.9 billion.
However, more textile and apparel exporting countries posted increases in exports to the U.S. than they did to the EU. Bangladesh notched a 19 percent increase to $1.8 billion, Cambodia was up 17 percent to $1.2 billion and Pakistan reported a 12 percent gain to $2.1 billion. Other suppliers that posted solid export gains to the U.S. included Jordan, up 21 percent to $811 million, and Peru, up 20 percent to $615 million.
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In the case of the EU, Turkey was the only other country aside from India and China to increase its exports in the post-quota era. Turkey’s exports rose by 6.2 percent to $10.4 billion. All other traditional suppliers, however, posted declines, with Hong Kong, Taiwan, Macao and South Korea witnessing the sharpest falls. The combined value of their shipments to the EU plunged 33.6 percent to $2.8 billion.
Bulgaria and Romania posted a combined decline in exports of 2 percent to $5 billion, while Tunisia and Morocco fell a combined 4.2 percent to $4.8 billion. Indonesia’s exports to the EU fell 15 percent to $1.4 billion, Bangladesh was down 5.7 percent to $3.4 billion and Pakistan slid 8.8 percent to $2 billion. Exports from sub-Saharan Africa also contracted by 11.4 percent to $792 million.