Analysis on the Development Prospect of China-Africa Textile Trade

China-Africa economic and trade cooperation began in the 1950s. With the continuous deepening of my country's reform and opening up, the scale of China-Africa economic and trade cooperation has gradually grown. China-Africa bilateral trade is highly complementary. my country mainly imports crude oil and other resource products from Africa, while exports to Africa are mainly low-priced and high-quality industrial products. From January to August 2006, my country imported 14.09 billion US dollars of crude oil from Africa, an increase of 54.5%. In the same period, the major categories of commodities that exported more than US$1 billion to Africa were: electromechanical products were 7.36 billion US dollars, a year-on-year increase of 43.7%; textiles US$2.52 billion, a year-on-year increase of 29.3%; clothing 1.58 billion US dollars, a year-on-year increase of 32.3%. Textiles are the second largest category of commodities exported from my country to Africa. 1 Status Quo of China-Africa Textile Trade China is both the world's largest textile processing country and the world's largest textile exporter. In 2005, my country's textile and apparel exports experienced a series of ups and downs, including quota cancellation, export taxation, RMB appreciation, export tax cancellation, Sino-European and Sino-US textile negotiations, and quota bidding, and still achieved rapid growth. According to customs statistics, in 2005, my country's textile and apparel exports totaled 115.01 billion U.S. dollars, an increase of 20.9% over 2004. From January to September 2006, my country's textile and apparel exports to Africa reached US$4.652 billion, a year-on-year increase of 31.90%. However, the African market did not account for a high proportion of China's textile and apparel export market, accounting for only 4.32% from January to September 2006. 2 Opportunities for the development of China-Africa textile trade In the context of the development of China-Africa trade, China-Africa textile trade is facing many opportunities: First, Africa has a large population and backward textile industry, which is a huge market that can be developed by my country's textile industry. At present, the per capita fiber consumption in Africa is only 3.2 kg, which is far lower than the world's average per capita fiber consumption of 8.7 kg. With the gradual economic development of African countries, the market demand for textiles and clothing has great potential. The long-term advantages of Chinese textiles and clothing are cheap and high-quality, which are in line with the current consumer needs of the African people. Therefore, opening up the African textile market should be a key area to realize the diversification of China's textile export market. Second, textile products can be exported to Europe and the United States through Africa. Some preferential policies of European and American countries for Africa provide a good plan for my country's textile industry to win the European and American markets. The American 'African Growth and Opportunity Act' (hereinafter referred to as the 'Act') and the European Union's 'Cotonou Agreement' grant preferential treatment to African countries in textile and apparel exports are still valid. The 'Act' provides for 48 African countries south of the Sahara Desert. Under the unilateral trade preferences, African countries that meet the requirements of the Act can export 460 kinds of goods to the United States duty-free under the Generalized System of Preferences (GSP) within 8 years. The most significant benefit from the 'Act' arrangement is textiles and clothing, and five of them are duty-free and quota-free. According to these laws and agreements, if my country produces and exports textiles in Africa, the market share of my country's textiles in Europe and the United States will be further expanded. Third, the Chinese government provides strong support. The government has formulated special policies to vigorously support enterprises to 'go global' and invest in Africa, encouraging domestic enterprises to expand their business in Africa. For example, the government provides discounted loans, sets up special funds, formulates preferential tax policies, increases support in finance, taxation, and financing, and simplifies approval procedures, and focuses on promoting enterprises to carry out overseas processing trade projects. The government has specifically invested hundreds of millions of yuan to set up 11 investment and trade centers in Africa to provide services for domestic enterprises to invest in Africa, set up special discount loans, and encourage investment in Africa to set up factories. Fourth, investing in Africa can enjoy many preferential policies of African countries. The labor cost in African countries is very low. Most countries have formulated many preferential investment policies to attract investment. For example, Egypt promulgated the Investment Law as early as 1989, and then promulgated a new Investment Protection Encouragement Law in 1997. 'And its implementation rules, the 'Special Economic Zone Law' was formally promulgated and implemented in June 2002, which formulated basic policies, regulations and preferential treatment for foreign investment. Since 2000, the South African government has provided technology and investment subsidies to small and medium-sized enterprises with new or additional investments in South Africa: Based on the total investment assets approved by the South African government, investors can enjoy a 3-year cash subsidy, quarterly Payment; The investment subsidy for the third year is based on (excluding the price of raw materials) whose labor cost accounts for more than 30% of the added value of the product, and one year's subsidy is also available. Approved enterprises can enjoy annual tax-free cash subsidies, which are paid quarterly for a period of 3 years; there are also foreign investment subsidies (relocation subsidies). In addition, setting up a business in South Africa does not require government approval, only a business license is required by an accountant; if you make money, you pay taxes, if you don’t make money, you don’t pay taxes, and only pay income tax every year. 3 Existing problems in China-Africa textile trade 3.1 Existing economic disputes and trade frictions As a traditional labor-intensive industry and a leading industrialization industry, the textile industry has positive significance for increasing employment and promoting economic development in African developing countries.

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