The wind of boycott of foreign goods blown by the Chinese official media has set off huge waves at Home and abroad, and the outside world questions China’s huge market, forcing foreign companies to “choose sides” on the issue of Xinjiang. At present, only a few foreign companies have compromised, most of them are unmoved, and the outside world is waiting to see how this tug-of-war will develop. But are foreign companies really the only ones to suffer from this boycott wave?
The boycott of foreign goods, which was instigated by the Chinese official media, is burning for the third day, and not only does it show no signs of subsiding, but it is getting stronger and stronger, and more and more brands are involved.
Many Chinese people have also “expressed patriotic feelings”, a female anchor live webcast of the process of cutting bad Nike clothes, some people held up signs to H&M stores in front of the protest, shouting “this is how I love my country”, was taken away by security guards; there are also properties in Qingdao Hang up signs, saying “refused to wear Nike and H&M people visit”.
Can China produce and sell its own cotton?
Chinese official media warned foreign companies not to “eat China’s rice, smash China’s bowl”, while vigorously promoting “support for Xinjiang cotton”, emphasizing that Xinjiang cotton accounts for nearly 90% of China’s cotton production, but also to import 2 million tons of cotton every year. “We ourselves are not enough”. The implication is that even if Xinjiang cotton is boycotted by Europe and the United States, China can also “self-production and self-sales”, no worries about sales.
But this statement, instantly refuted by some Chinese netizens, questioned is carefully avoiding the important, completely ignoring the huge impact on China’s textile industry, which is highly dependent on exports.
A foreign microblogger commented: “Boycott a commodity, may not simply boycott a foreign company so simple, at present China is a large manufacturing country, boycott this foreign company may affect the supply chain behind the company, and every link in the supply chain may have the shadow of Chinese companies, affecting others and may even affect themselves. “
Half of China’s textile industry depends on exports
Some analysts counted an account, China’s cotton and yarn and other raw materials, mainly used in three areas, including apparel, home textiles and technical textiles.
In the field of clothing, China’s annual domestic retail sales of about 1 trillion yuan, exports of about $ 120 billion, or about 840 billion yuan, that is, exports accounted for 46% of China’s total clothing production.
In the field of home textiles, China’s annual domestic retail sales are about 200 billion RMB and exports are about 42 billion USD, equivalent to about 300 billion RMB, i.e. exports account for 60% of China’s total output of home textiles.
In technical textiles, China’s annual domestic retail sales are about RMB 80 billion and exports are about USD 27 billion, equivalent to RMB 190 billion, i.e. exports account for 70%.
Adding up the three major finished textile industries, the total export scale is close to $190 billion, equivalent to about 1,330 billion yuan, that is, exports account for more than half of the total output of China’s textile industry.
Foreign boycott of Xinjiang cotton will hit China’s textile industry
In other words, China produces cotton, spinning yarn, weaving cloth, half of which is sold to foreign countries. If foreign companies follow the rules of Europe and the United States, a full boycott of China’s cotton production accounted for 90% of Xinjiang cotton, as well as Xinjiang cotton as raw materials for products, will hit China’s highly dependent on exports of textile industry.
According to the General Administration of Customs of China, China’s total exports in 2020 will be 17.93 trillion RMB. Based on this figure, it is estimated that 7.4 percent of China’s exports come from the textile industry.
Mr. Yu, a scholar graduated from Xinjiang Agricultural University, believes that if foreign countries were to boycott Chinese cotton across the board, the direct and indirect losses to China would be incalculable.
Mr. Yu said: If foreign countries boycott China’s cotton exports, for a world’s second largest cotton exporter, it may cause hundreds of billions of dollars of foreign exchange losses to China every year. This is only part of it, in addition, the indirect losses caused to the cotton processing and textile enterprise workers employment in the Xinjiang region, is incalculable. Therefore, these decisions made by the head, the most affected by the loss should be the country’s enterprises and employees families, the Chinese government should think twice.
Manufacturers may have to switch to Pakistani or Indian cotton
Hong Kong Legislative Council Member of the textile and clothing sector, Chung Kwok-pan also said that if the above situation occurs, the Hong Kong manufacturers of products to be exported to Europe and the United States, we have to switch to Pakistan or India cotton. He said he believes that in a large number of manufacturers to switch to foreign cotton, the price will rise, the cost will be passed on to foreign brands.
However, the outside world is more concerned about, once the manufacturers decided to abandon the use of Chinese cotton for a long Time, switch to cotton from other countries, will the original production line and industry chain in China, further accelerating the withdrawal of foreign capital?
This “patriotic riot”, in the end, who benefits, who suffers?
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