WASHINGTON — Vietnam posted the largest increase in apparel imports to the U.S among the top 10 suppliers in July, while Mexico registered the only decline, the Commerce Department’s monthly report showed Thursday.
Vietnam, the second-largest apparel supplier to the U.S., which is also taking part in the 12-nation Trans-Pacific Partnership negotiations, posted a 12.75 percent increase in apparel imports to 270 million square meter equivalents in July compared with a year earlier.
Asian apparel suppliers to the U.S. outpaced Western Hemisphere suppliers, as overall apparel and textile imports to the U.S. from the world rose 10.5 percent to 5.9 billion SME in July compared with a year earlier. Overall apparel imports increased 7 percent to 2.6 billion square meter equivalents in July, while total textile imports were up 13.4 percent to 3.3 billion SME.
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“I think [Vietnam] is taking market share away from China,” said Nate Herman, vice president of international trade at the American Apparel & Footwear Association. “They are solidifying their position as the number-two [apparel] supplier, but also taking market share away from China.”
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Apparel imports from China, the top supplier to the U.S., rose 7.7 percent to 1.19 billion SME in July compared with July 2014. That growth came despite rising labor costs in China.
“Every expert you talk to, which was [revealed] in our benchmarking study, talks about the need to find alternatives to China, but the fact remains that imports from China are substantially growing,” said Julia Hughes, president of the United States Fashion Industry Association. “It seems like new investment is going outside of China, but I do think China remains a safe haven for companies in terms of production capabilities and [reliability].”
Apparel imports from Bangladesh and Cambodia, two countries that have struggled to recover from safety and wage issues in recent months, posted gains of 8.8 percent and 8.3 percent, respectively, in July.
Apparel imports from Honduras rose 7.6 percent in July, but were up about 4 percent for the year, while apparel imports from El Salvador rose 7.2 percent in July but were flat for the year. Mexico’s apparel imports fell 9.4 percent to 76 million SME.
“Mexico used to be the number-one supplier but that was back when NAFTA [the North American Free Trade Agreement] was the only free trade agreement in town and before the end of the quota system,” said Hughes.
The North American Free Trade Agreement came into effect in 1994, while the Central American Free Trade Agreement, covering the U.S., Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and the Dominican Republic, came into being in 2005. The global system of quotas, which set import limits by country, reached final phase out Jan. 1, 2005.
The overall U.S. trade deficit narrowed in July to $41.9 billion from $45.2 billion in June pushed primary by an increase in consumer goods exports.