Textile quotas had been removed among WTO contributors at the first day of 2005 in accordance with the Agreement on Textiles and Clothing (ATC). However, resistance to quota elimination spread in the US and EU. Subsequently, China reached agreements with the EU and the United States in June and November 2005 respectively. The China-US agreement, powerful from January 2006, governs the exports of a total of 21 corporations involving 34 categories of Chinese textiles and clothing products to america during 2006-2008. The China-EU settlement, effective from June 2005, covers 10 categories of Chinese textiles and garb exports to the EU all through 2005-2007.
On the alternative hand, the mainland and Hong Kong agreed in October 2005 to further liberalise the mainland market for Hong Kong groups underneath the 0.33 section of the Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA III). Along with different merchandise of Hong Kong foundation, the mainland agreed to present all products of Hong Kong starting place, together with garb items, tariff-unfastened remedy beginning from 1 January 2006. According to the stipulated tactics, merchandise which haven’t any current CEPA regulations of starting place, will experience tariff-free treatment upon programs by using neighborhood manufacturers and upon the CEPA rule of origins being agreed and met.
Hong Kong garb businesses are reliable for ODM and OEM production. They are able to supply satisfactory clothing articles in brief lead time, as foreign importers and stores request garb suppliers to tighten up supply chain control to make sure the ordered products accomplishing the store floor at the right time. Increasingly, Hong Kong garb corporations, the hooked up ones especially, have proven enthusiasm for logo promoting.
Hong Kong’s overall exports of garb rose yr-on-yr by using nine% in the first 11 months of 2005. While Hong Kong’s re-exports of apparel rose via 20%, domestic exports fell via 14%. In the primary 11 months of 2005, Hong Kong’s apparel exports to the United States and EU rose by eleven% and 18% respectively. While Hong Kong’s apparel exports to Japan levelled off, the ones to the Chinese mainland declined by way of 11%.
Industry Features
The apparel enterprise is a primary manufacturing sector of Hong Kong. Its gross output is one of the highest amongst all production sectors, amounting to HK$35.Nine billion in 2003. It is the largest manufacturing employer in Hong Kong, with 1,673 establishments hiring 28,752 employees as of June 2005. It is also the main earner in phrases of home exports, taking up forty% of the overall inside the first eleven months of 2005.
Hong Kong’s geographic boundary has never restrained the improvement of the ahead-searching clothing industry. The majority of apparel manufacturers have set up offshore manufacturing facilities in an try to lessen operation expenses. Relocation of production facilities offshore has however led to a constant decline within the quantity of clothing manufacturers in Hong Kong.
Hong Kong isn’t most effective a main manufacturing centre but also a hub for clothing sourcing globally. Companies doing garment change in Hong Kong are experienced in fabric procurement, sales and advertising and marketing, satisfactory manipulate, logistic preparations, clothing designs and worldwide and countrywide guidelines and rules. The professionalism that they command and the mixed services offered aren’t effortlessly matched someplace else. With a complete of 15,190 establishments hiring 95,889 employees, they form the most important organization involved in import-export change in Hong Kong.