China shows textile strength in Canada

While Canada may face a protracted trade war with the United States, its apparel and textile sector is getting a boost from Chinese partners.

Hundreds of Chinese companies joined the Apparel Textile Sourcing Canada (ATSC) show on Monday at the Toronto International Centre.

New to this year’s event was the China Brand Show, adding categories such as accessories, giftware, home electronics, footwear, luggage, housewares and general merchandise. A first-of-its-kind showcase of top brands from China, called Avenue ATS, also will appear at the three-day show.

“China’s top 10 brands have unique designs and innovations to offer and are eager to do business with Canadians,” said Jason Prescott, CEO of JP Communications, ATSC producer. “These top, high-quality Chinese brands are looking for Canadian representatives to import and distribute their products in a big way in this market – it’s an unprecedented opportunity.”

China is the world’s largest source-garment exporter for multinational brands, ranging from luxury and high-end names such as Armani and Hugo Boss to fast fashion brands such as Inditex (Zara), Gap, C&A and Fast Retailing. China’s clients also include competitive price players like Walmart, Costco, Tesco and Carrefour.

According to Cao Jiachang, chairman of the China Chamber of Commerce for Import & Export of Textiles (CCCT), China’s exports in the garment and textile market have increased dramatically in the past decade; however, China’s market share in world trade value has decreased the past two years.

“Chinese companies are changing their exporting strategy and the structure of the portfolio to exporting to the global world,” Cao said.

China’s outbound investment in the textile and garment sector experienced an annual increase of 20 percent in the past 15 years, but investment in the sector fell by 55 percent last year.

Clay E. Hickson, vice-president at Worldwide Responsible Accredited Production, said China may have passed its zenith, but it is still an indispensable source country, especially for complicated processing or medium-to-high end fashion items.

“China is still one of the front-runners in the global textile and apparel supply chain, and incentives for Canadian brands continue for basing production and sourcing in China,” Hickson said.

In 2017, China’s textile and apparel exports to Canada totaled $4.26 billion, up by 12.97 percent year-on-year; imports from Canada reached $28.27 million, up 8.72 percent year-on-year.

“I think the Chinese investment in the garment and textile sector in Canada will bring in win- win solutions for both countries,” said Wu Zhengping, director general at the Trade Development Bureau of the Ministry of Commerce.

Amid an escalation of the ongoing trade dispute between the US and China, as well as a long-lasting trade war between the US and Canada, “China takes a positive position to promote the free trade talk with Canada and all the world,” according to Lu Shaye, China’s ambassador to Canada.

“A free trade agreement (FTA) is a benefit to both China and Canada, especially under the current global trade tensions background, and moving to diversification is both of our strategies, especially for Canada,” Lu told the audience at an ATSC seminar.

Meanwhile, Canadian products are suitable for the Chinese market, especially Canada’s strength in agriculture, mining and clean technology, Lu said.

“I think we can deepen the cooperation under the FTA, and Canadian companies and enterprises could expand their shares in the Chinese market,” he said. “We’re ready to restart the talks at any time.”

Canada is in talks with the United States to renegotiate the North American Free Trade Agreement (NAFTA). The US and Mexico are expected to reach a separate deal on NAFTA soon.

“It would be fair to say that China has become the fourth player to NAFTA,” said Prescott. “As most of the world has a general respect for free trade, Canada does especially.”