Dear readers

The dynamic atmosphere and business boom seen at various textile and apparel trade shows steamed up an encouraging prospect， overshadowing the disappointing expectation brought forth by the tariff imposed on the Chinese 200 billion dollars of merchandises imported into the United States， which started on Sept.14th in a new round of punitive move aimed at China.

The additional 10% tariff is expected to escalate up to 25 percent as the dawn of the new year 2019 breaks， China will definitely whip back with equally sizable strength and magnitude to safeguard our interests and global trade system that is based strongly against any forms of unilateralism. With that in concern， I wonder if the new year will come with what we have seen as an encouraging prospect felt and touched at the trade shows or with a discouraging expectation as the trade grapple intensifies into a new arena？

I visited some apparel manufacturers who are doing export business， and I was surprised to get different feedbacks when I asked if the present trade situation had brought about some affect on their business. Some manufacturers told me that they were not experiencing difficulties at all， on the contrary， they had made some money out of Chinese Yuan depreciation because the present orders on streamline are all from the contracts that had been signed in dollar terms much earlier before the trade spats intensified. I know this response is very narrow-minded， and the lucky result is of a day on the ephemerality. The companies will be inflicted with the growing pains running through all the body， even paralyzing the entrepreneurial spirit if clients reduce the number of business deals to outsource overseas rather than place new orders here in China， provided that China-U.S. tariff punishments， in an alternative episode， spur to a new high to add more uncertainty or even harder predictability.

If new orders continue to be placed here in China， which I believe will happen， but who will bear the tariff burdens if new round of trade struggle sparks off ？ It is known very well that the majority of OEM business is based on F.O.B price， with very few cases that our manufacturers are requested to deliver goods in C.I.F terms. Will clients be ready to take in all the new costs if they are willing to keep China as the most competitive supply chain？ Knowing that the competiveness of Chinese textile and apparel industry is more advantageous for many reasons in many aspects， regardless of cost rise for operators， I remain optimistic of business prospect， especially for the orders that entail more sophisticated process steps， labor skill， manufacturing quality， lead time， corporate compliance， attention to details， abundant source of productive materials， social stability， and what you have.

In fact， there are already affects that impacted our textile and apparel industry with respect to export drop and outsourced production. The textile （yarn， fabric and made-ups） is taking up increased share of total export， nearly on equal footing with apparel in dollar value in textile-and-apparel export portfolios， meaning more textiles go to the new apparel manufacturing hubs where Chinese invested new facilities for overseas operations. Could this trend affect the stability and sustainability of manufacturing foundations locally in China？ To be or not to be， that is the question！