Li Keqiang to Jiangsu to cheer foreign companies
The boycott of foreign goods by the Chinese official media has created a huge wave at Home and abroad, with questions about China’s huge market forcing foreign companies to “take sides” on the Xinjiang issue. At present, only a few foreign companies have compromised, most of them are not moved, 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, not only without signs of subsiding, but also blowing more and more vigorously, and more and more brands are involved.
Many Chinese people have also “show patriotism”, a female anchor live webcast the process of cutting bad Nike clothes, some people held up signs to H&M stores to protest, shouting “this is how I love my country”, was taken away by security guards; there are also properties in Qingdao hanging up signs, saying “refuse to wear Nike and other products. There are also signs in Qingdao that say “No visitors wearing Nike and H&M”.
The Chinese Foreign Ministry continues to fuel the boycott wave, with spokeswoman Hua Chunying saying that the United States and several Western allies “have extended their black hands to the snow-white cotton in Xinjiang, smearing it with forced labor and even genocide“. She stressed that China is not the “late Qing Dynasty” under the iron heel of the Eight-Power Allied Forces, China is open and honest, and the facts will pierce all the rumors against China.
The U.S. is not genuinely concerned about the Uighur people, and their real goal is to undermine China’s security and stability and deter China’s development and growth,” Hua Chunying said. I want to tell the U.S. side that today’s China is not Iraq, nor is it Syria, nor is it the late Qing Dynasty under the iron heel of the Eight-Power Allied Forces. The United States directed this play, it is Time to close.”
Can China produce and sell its own cotton completely?
Chinese official media while viciously warning foreign companies not to “eat China’s rice, smash China’s bowl”, while vigorously promoting “support for Xinjiang cotton”, emphasizing that Xinjiang cotton accounted for nearly 90% of China’s cotton production, but also imported 2 million tons of cotton each year, “we are not enough”. “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. “
China’s textile industry half of the products rely on exports
Checking the statistics of China’s textile industry, China’s raw materials such as cotton and yarn are mainly used in three areas, including apparel, home textiles and technical textiles.
In the apparel sector, China’s annual domestic retail sales are about 1 trillion yuan, and exports are about $120 billion, which translates into about 840 billion yuan, or 46 percent of China’s total apparel production.
In the field of home textiles, China’s annual domestic retail sales are about RMB 200 billion and exports are about USD 42 billion, equivalent to about RMB 300 billion, 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 a raw material products, China will lose nearly $ 200 billion in foreign exchange earnings, hitting China’s highly dependent on exports of textile industry.
And according to China’s General Administration of Customs, China’s total exports in 2020 will be RMB 17.93 trillion. Based on this figure, it is estimated that 7.4% of China’s exports come from the textile industry.
Mr. Yu, a scholar at 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 cotton processing in Xinjiang region, textile enterprises workers employment caused by indirect losses, the
is even more incalculable. Therefore, these decisions made by the head, the biggest losses 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 for Textiles and Clothing Zhong Guobin also said that in the new international political situation, Hong Kong manufacturers to export their products to Europe and the United States, they have to switch to Pakistani or Indian cotton. He said he believes that in a large number of manufacturers a time 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 show”, in the end, who benefits and who suffers?
Premier Li Keqiang sang the opposite tune? Visiting foreign companies in the midst of the boycott wave
In the past few days, the whole China has been boycotting foreign goods, but the Chinese Premier visited Jiangsu province, where many foreign companies are gathered.
This enterprise has provided chemical raw materials for Nike, Adidas and other brands.
BASF’s sales in China reached 8.5 billion euros in 2020, and China is currently BASF’s second largest market in the world, after the United States.
Li Keqiang began his visit to Jiangsu on the 25th, but the central media did not report his trip in detail, only the State Council’s Chinese government website. Li mainly toured high-tech companies in Jiangsu, telling employees at one of them to “work in a down-to-earth manner.
He also told the management: “The more you invest, the more tax credits, the happier we will be, which will effectively stimulate enterprise innovation and promote industrial upgrading. We want to leverage enterprises and society as a whole to increase investment in R&D through tax incentives and market-based approaches that are fair and inclusive. Not only to four two dial a thousand jin ……”
Recent Comments