EU, US missions make heavy purchases in China

The sudden abolishment of textile export tariffs by the Chinese government on 81 categories of textile products is depicted by the European Union and United States interest groups as "a signal of danger''. But it is undoubtedly good news for the textile buyers of the EU and the US, according to Beijing Morning Post.

The first large EU and US purchase mission went to Shaoxing to continue its purchasing mission for half a month after signing contracts worth US$50 million with Guangdong suppliers. The foreign buyers are expected to bring more orders to Chinese textile enterprises.

Guangzhou is the third leg of the mission's China tour. Before Guangzhou the mission has been to Hangzhou and Suzhou.

For all that the purchasing has been made at the time of the textile friction between China and the EU & US, It will be possible that confrontation might be upgraded. However, the purchase tour of the EU and US textile missions in China is not affected.

"The policy change will make the trade uncertainty grow. However, the importers will more likely to focus on middle-and long-term development, according to the responsible person for the purchase activities. There is an optimistic estimation that the total purchase orders might surpass 1.8 billion US dollars.

In an interview with Beijing Morning Post, Ms. Wang with the Guangzhou Exposition Center said that the buyers have a clear attitude that they disagree with the restrictive measures imposed on Chinese textiles. In addition, the abolishment of the textile export tariffs will retain the cost advantages for Chinese textiles.

For the moment, a piece of clothing of low value added is generally only 3 to 5 percent of profits. The suppliers must raise about 8 percent of their sales price if higher export tariffs are imposed. It might be a wiser choice for the US purchasing businessmen to turn to India and Pakistan for buying.

Nevertheless, most of the buyers and Chinese textile enterprises still maintain cautious when signing orders. "Now the Chinese enterprises do not dare accept big orders''.

By People's Daily Online