Tracing China’s Impact in Global Economics and Textiles
October 25, 2022 On-going geopolitical and economic scenarios highlight the growing prominence of China in the world order.
On Oct. 20, as part of celebrating cotton harvest in the Texas High Plains of Texas, the Lubbock Chamber of Commerce hosted Luke Lindberg, Founder and Principal, E. Pluribus Unum, LLC. Lindberg has had firsthand experience in dealing with China and provided an overview on China’s status in the world.
“China is an important market and a competitor for the United States,” he stated. “The transition of China from a nation of famine to a feasting one within one to two generations is remarkable and hence it is important to be cognizant of China’s aspirations.”
Speaking at the recent Communist Party of China’s National Congress, Chinese President Xi Jinping highlighted the importance of development focusing on domestic economy, strengthening education, and innovation. The congress highlighted China’s aspirations to strengthen its security and grow its domestic economy to gain an upper hand on its growth. Recent GDP numbers show that China has witnessed a growth of about 3.9% in Q3 relative to last year, while domestic demand has been weak.
The zero Covid-19 policy has played a role in the slowing of Chinese economy, and this is a setback for China’s ambition to be a dominant superpower. A growth of about 3-4% is not sufficient to achieve such a status, commented Professor Rashid Al-Hmoud, Department of Economics, Texas Tech University.
Lindberg viewed that China aspires to be the sole superpower to overtake the United States. To counter competition from China, it is important that countries focus on innovation, build trade alliances, and invest in foreign diplomacy, he added.
China hopes to be less import dependent, which necessitates exporting nations to explore alternate markets and new technologies and develop value-added products. Today, this is clear with the dire situation of cotton spinning mills in India which are dependent on exports to China.
Regarding the ongoing political crisis in the United Kingdom and its impact on the economy, Lindberg opined that it is important for the United States to have robust trade deals with countries to enhance trade.
“Going on trade missions is important,” he added, noting that countries like China need agricultural imports from the United States, particularly cotton and soybeans. While countries like Brazil and Australia are trying to capture more of the Chinese cotton market, Lindberg said the Chinese favor the quality and reliability of U.S. cotton.
“China continues to be an important market for U.S. cotton and is number one or number two in terms of cotton imports from the United States,” stated Shawn Wade, Director of Policy Analysis and Research with Plains Cotton Growers, Inc. He pointed out that Texas is expected to produce 3.4 million bales (480 lbs. per bale) this year, and almost all of it will be exported.
While China’s cotton imports are high, yarn imports are slowing down, indicating a shift towards growing domestic manufacturing – one of the priorities highlighted during China’s National Congress.
The ongoing global economic crisis, political instability in some regions of the world, the aspirations of China and Russia, and weakening consumer confidence all necessitate the need for new pathways for the global textiles sector.
“It’s critical and important for the United States to invest in research and continue export expansion, which is important for trade advancement and national security,” urged Murvat Musa, Executive Director of Reese Technology Center, a business and research park in Lubbock.
Investing in R&D, focusing on innovation, and exploring new markets are a few feasible options available for the global textile industry.
GET THE NEWSLETTER TODAY!
