According to Reuters, the rising cost of Chinese textiles is prompting many Western apparel companies to switch back to European suppliers.
While China remains a world leader in textile manufacturing, employing 4.6 million people, wages have been increasing at an annual rate of 12%, outpacing the economy. That, combined with the surging costs of raw materials, such as cotton and wool, hefty import taxes for basic manufacturing equipment, and costlier environmental rules, have caused China to lose its competitive edge on textile pricing.
Another factor that’s led to the current European textile boom is the increased want for transparency among Western textile buyers, although that has less to do with ensuring that workers are treated fairly, and more to do with avoiding any potential controversies that could hurt the buyer’s reputation.
Also playing a role is that Western apparel customers have begun to demand a larger number of collections per year, as well as customization options, and both require suppliers that are closer and faster. As the Chairman of Hong Kong General Chamber of Textiles Ltd, Shiu Lo Mo-ching, explains, “When China’s wages are not that low, the process of shipping materials so far to China and then shipping products back to Europe becomes a lot less attractive.”
You can read more about it at Reuters.
