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US President Donald Trump looks on, on the day he signs an executive order in the Oval Office at the White House in Washington, US, January 31, 2025. — Reuters
#Trumps #tariffs #reshape #global #trade
LAHORE: If Donald Trump continues to impose more taxes on imports from China, Canada and Mexico, US importers can look for alternative suppliers. Pakistan can benefit if he positions himself as a competitive source for textile and apparel.
Pakistan does not directly compete directly in these sectors under Mexico and Canada, so its effect will be minimal. However, since our country imports a significant portion of machinery, electronics and raw materials from China, US prices can indirectly affect Pakistan with any slowdown in China’s economy. If Chinese companies struggle to export to the United States, they can reduce prices or divert exports to other markets, which could potentially make some Chinese goods cheaper for Pakistan.
If Trump targets China at prices, he can also pressure China -affiliated countries, including Pakistan. The United States, especially the benefits of the general priority system (GSP), can also increase trade pressure on the United States.
Trade war with China can weaken global demand, which can affect commodity prices. Although Pakistan may benefit from the low import costs, the international supply chain barriers may be inflation, especially for products depending on intermediate goods from China. Trade tensions can also mobilize capital flight from emerging markets to secure heen assets such as the US dollar, which increases the reduction of rupees, high import costs and increasing burden of external debt.
If the Chinese economy slows down, Pakistan can benefit from cheap imports, but it may face less demand for China. Increasing US pressure on Pakistan’s trade relations with China could further create further economic uncertainty, including currency fluctuations and inflation risks. Bangladesh, one of the largest exporters of costumes, is to benefit from high US tariffs on Chinese textiles. With duty-free access to the minimum developed countries (LDC), Bangladeshi clothing can grow, especially large-scale markets, low-cost clothing such as cotton T-shirts, jeans and nutware. However, since Bangladesh imports many raw materials, including artificial fabrics, colors and machinery from China, some kind of slowdown or price increase in China can increase its input cost. Competition for the removal orders from Vietnam and India can also limit its benefits. Nevertheless, Bangladesh is one of the biggest beneficiaries due to the textile supply chain and low labor cost.
India produces cotton, artificial fabrics and technical textiles with its diverse textile industry, can see the growing exports of yarn, clothing, and finished clothing to the United States as companies go away from China. However, India lacks duty-free access to the United States, and its high production costs-especially with electricity and supply-labor laws, make it less attractive than Vietnam. In addition, if China floods the Indian market with cheap textile, domestic producers may suffer. Although India can benefit from textile raw materials, Bangladesh and Vietnam are stronger in costumes.
Vietnam is already an important apparel provider to the United States, in which many Chinese garment companies have transferred the production there to ignore US prices. If Trump increases duties on China, this trend will accelerate. However, Vietnam’s growing labor can face challenges depending on the costs of Chinese textiles. If the United States considers Vietnam as a backdoor of Chinese products, it may face an increase in checking. However, it is expected that Vietnam will get a market share on China’s expenses, especially in the mid -to -higher clothing. One of the world’s largest cotton producer, Pakistan will have to take strategic steps to increase its cotton production and take advantage of its well -established spinning. And the made industry. Unlike Vietnam and Bangladesh, who rely on imported cotton, Pakistan has a natural benefit in cotton -based textiles, especially denim, domestic textile and nutware. The United States is already a major buyer of Pakistani denim and bed clothes.
To take advantage of this opportunity, Pakistan will have to increase its capacity in cotton -based clothing, especially denim, nutware and towels, which are more demanding in the United States. Adopting environmentally friendly processing methods and reducing China’s dependence on China can further strengthen Pakistan’s position in the global textile market. However, Pakistan relies on China for artificial fabrics, colors and machinery. If China faces economic slowdown or if the US scrutiny extends to sugar -linked supply chain, Pakistan’s production costs may increase, which is a challenge to its textile industry.
