Domestic Textile Industry "Return" To The Midwest And Usher In Rapid Development

As we all know, with the advantage of demographic dividend, many domestic industries are in the forefront of the world, especially in industries with high labor demand. The typical representative is the manufacturing industry. Now China has been recognized as the "world factory" all over the world. Many goods in the world are produced and processed in the domestic market. But at present, the domestic labor cost is rising, and has lost some advantages. Therefore, many manufacturing enterprises have chosen to "withdraw" and set up factories in Southeast Asia, where the labor cost is relatively low.

It is worth noting that in addition to the manufacturing industry, the domestic textile industry has also shifted to Southeast Asia. According to relevant statistical data, Vietnam's total textile and clothing exports increased by 7.5% in 2019, but in the past year, China's textile and clothing exports have declined to a certain extent, with an export volume of about 271.8 billion US dollars. It can be seen from here that the domestic textile industry has indeed shifted to Southeast Asia, but it is mainly reflected in the fields of spinning and garment production.

However, from another point of view, the labor cost in Southeast Asia is indeed relatively low, and it can bring certain advantages to the textile industry. However, almost all the spinning industries are transferred from domestic industries to Southeast Asia, which is not a good news for the domestic market. In 2019, China's investment in Vietnam accounted for 32% of Vietnam's total spinning capacity.

From the practical development point of view, although the labor force in Southeast Asia is indeed relatively low, domestic textile enterprises can enjoy the advantages brought by labor force after the establishment of factories in Southeast Asia, but the transportation in Southeast Asia is not developed, and the industrial chain is not very perfect, so many textile enterprises still need to bear high logistics costs, which is also the cost of textile enterprises. The boss of a textile enterprise said that the salary of Myanmar workers is very low, less than 500 yuan a month.

Therefore, the Ministry of industry and information technology proposed to support the transfer of textile and clothing industry to the central and western regions, which is also a new choice for textile enterprises. Judging from the current development, a number of textile industrial parks have been built in the central and western regions. That is to say, the domestic textile industry is transferring to the central and western regions. From a long-term perspective, the domestic textile industry production capacity may be greatly increased in the future, and to a certain extent, it can promote the economic growth of the central and western regions.

Let's take a look at the textile industry in Southeast Asia. In recent years, the export volume of textile and clothing industry in Southeast Asia has maintained growth, with an annual growth rate of more than 5%. Affected by the transfer of textile industry, the textile and garment export volume in Southeast Asia is still growing relatively fast, and the increase is relatively high. At the same time, the growth of export volume of textile and clothing industry in Southeast Asia is mainly due to the establishment of factories in Southeast Asia by many domestic enterprises.

The boss of a textile enterprise said that he set up a factory in Myanmar in 2013, on the one hand, because Myanmar exports to the EU zero tariff, on the other hand, because the wages of Myanmar workers are relatively low. In addition, the cost in Southeast Asia is relatively low, so many Chinese textile and garment enterprises have set up factories in Southeast Asia. But at present, the industrial chain in Southeast Asia is not mature, so there is not much profit space compared with domestic production.

To sum up, there is a policy to support the transfer of textile enterprises to the central and western regions of China. However, in terms of the volume of textile and clothing, industrial chain supporting and other fields, although the domestic spinning capacity is transferring to Southeast Asia, the main export place of Southeast Asian cotton yarn is in the domestic market, so the Southeast Asian textile industry is also a supplement to the domestic industry.

But after the transfer to the central and western regions, it means that the central and western regions will usher in rapid development, which is also conducive to the domestic market.