2015-06-24

TPP Aims to Slow China's Growth Rate

Exactly the strategy outlined in Luttwak's The Rise of China vs. the Logic of Strategy

WSJ: Fabric of a Trade Deal: U.S. Asks Vietnam to Cut Out Chinese Textiles
To that end, American trade negotiators are demanding that Vietnam, a major garments exporter, reduce its reliance on textiles made in China, which isn’t part of the trade pact, to get preferential market access to the U.S.

The goal is to create new markets in Vietnam for the U.S. textile industry, which employs a quarter of a million Americans and exported $20 billion last year.

“The U.S. and Mexico are especially large textile producers,” said Eliza Levy, a spokeswoman for the National Council of Textile Organizations. “Vietnam would simply have to shift its sourcing of yarns and fabrics from China to the U.S. and Mexico.”

...U.S. fashion brands oppose this approach, which they say ignores the complexities of global supply chains. Vietnam is the second-largest exporter of apparel and footwear to the U.S., behind China, with $13.1 billion in sales last year. But the country only produces enough fabric to meet a fifth of its needs and buys about $4.7 billion worth from China, or about half its total annual imports.
They'll adapt to new complexities.

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