EU Textile and Apparel Industry and Trade Patterns: Discussion Questions from FASH455

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#1: How do the ‘double transformation‘ rules of origin in most EU free trade agreements benefit or hurt the EU textile and apparel industry? What are the economic, geographic and policy factors behind the growing intra-region textile and apparel trade in the EU?

#2: The EU region is a leading producer of textiles and apparel. What effect do you think the proposed EU-US trade agreement will have on big-name EU fashion brands such as Hugo Boss?  What effect do you think the agreement will have on textile and apparel production in the EU as a whole?

#3: Why or why not do you think the EU textile and apparel industry is immune to the ongoing US-China tariff war?

#4: Comparing VF Corporation with Hugo Boss, what are the similarities and differences of their sourcing strategies? How might their respective sourcing strategy involve in the next 3-5 years and why?

#5: With such an emphasis on the merging of technology, data analytics, and differentiation in the textile and apparel industry worldwide, do you think it is possible for a small European apparel brand to compete with larger companies in the region? If so, how?

Additional reading; The EU-28 Textile and Clothing Industry in the year 2018

(Welcome to our online discussion. For students in FASH455, please address at least two questions and mention the question # in your reply)

Author: Sheng Lu

Professor @ University of Delaware

2 thoughts on “EU Textile and Apparel Industry and Trade Patterns: Discussion Questions from FASH455”

  1. #1: “double Transformation” – textile industry promotes and loves the rule since it forces their EU-customers (willing to particiapate in FTAs) to buy their products – Apparel industry hates it because it is THE barrier to participate in FTAs. I am very surprised that so many companies are still being able to manage FTAs – hopefully in a compliant way – chapeau !
    The growing intra-EU-trade is caused by near-shoring production and E-Commerce I assume.
    #2: as long as the existing rules-of-origin in the EU- and US-FTAs exists the chance to benefit from an FTA is getting smaller and smaller. It is not understable that the oldest industry at all and the most-globalized industry has the most-restrictive rules – established in the 70-ties of the last century and ignoring the trade developments of the last 30 years (that I can remember).
    #3: It is immune as long it is not exporting to the US. But those who export (most of them sourcing in China as well) are in the same situation as the US importers.
    #5: Invests are actually so high in digitalisation (for product development, for sales incl. E-Commerce’) that it has become very difficult for smaller brands to compete and grow.

  2. #1 The ‘double transformation’ rules of origin in most EU free trade agreements benefit the EU textile and apparel industry because it allows for the importing of specialty goods that might not be found in the EU but also stimulates its own industry by keeping fabric forward production in the EU. Because the EU consists of many countries that are close in proximity, the double transformation takes advantage of the geographic benefits and can account for shorter lead times and more flexibility. The intra-region textile and apparel trade happening within the EU allows for the EU to be self-sufficient and creates a greater independence of the EU, allowing them not to rely on other regions.
    #3 In regards to the EU Textile and Apparel Industry, I think that the EU is immune to the ongoing US-China tariff war because the EU is self-sufficient the textile and apparel industry. The EU does not feel the repercussions of the U.S.-China tariff war because the EU has very advanced technology for textile manufacturing, as well as, advanced technology for apparel making. That being said, the EU does not have to rely on China for mass production compared the U.S., who has driven the apparel production sector almost completely out of its country.

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