Country benefit US-China trade war
US’s widening trade deficit with China is
a major cause of the country’s economic woes. US government has
started imposing protectionist measures on imports from major
trading partners like China and Canada.
US has recently decided to slap 25% tariff
on imports worth up to US$ 200 billion from China. Bangladesh
can directly benefit in the event of an escalating trade war
between the US and China, especially if the US imposes higher
tariffs on imported Chinese apparel.
Alongside this, Bangladesh can be
benefited from the capital flight, as some Chinese apparel
manufacturers would be seeking to relocate operations to a
country having normal trade ties with the US.
The trade war is contributing to price
volatility in the cotton market, which is a key raw material for
the apparel sector. China’s stockpiling and procurement of
cotton from regional cotton producers like Uzbekistan and India,
instead of the US- will cause a mismatch in the demand-supply
scenario. Bangladeshi textile manufacturers may suffer, as a
Almost all top clothing retailers like
H&M, Walmart, JC Penney, Inditex, Zara, Gap, M&S, Uniqlo, C&A,
Tesco, Hugo Boss, and Adidas have been souring garment items
worth of billion dollars from Bangladesh every year. Presently
they are shifting orders from Bangladesh to other countries.