US-China trade war accelerates apparel factories’ shift from China to Southeast Asia and Bangladesh

Calvin Klein, Tommy Hilfiger, Levi’s, Crocs and Uniqlo have moved their production out of China as costs rise and nation moves up value chain

As others follow, Vietnam is first choice for footwear, Bangladesh has a skilled workforce, Indonesia is modernising factories, and Cambodia is also a player

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A worker at PT Moriuchi textile factory in West Java, Indonesia. Indonesia aims to be one of the world’s top five textile and apparel producers by 2030. Photo: James Wendlinger

Published: 7:15am, 4 Nov 2019Updated: 7:11pm, 5 Nov 2019

Fashion brands must focus on current affairs as well as current trends. Lately industry executives have been expending a lot more time and effort than expected on working out what US President Donald Trump will do next.

On October 1, Trump fired another shot at the heart of Chinese manufacturing when he increased existing tariffs on US$250 billion worth of Chinese goods from 25 to 30 per cent.

An additional US$300 billion worth of Chinese imports were also taxed at a 15 per cent rate – and much of the focus was on apparel. This has caused major problems for the many fashion brands that make their goods in China and market their wares in the United States.

Since the start of Trump’s presidency, household names such as Uniqlo, Levi’s, Crocs, Calvin Klein and Tommy Hilfiger have moved their entire manufacturing base out of China.

Workers at a southern Chinese bra factory. Photo: Alamy

Politics is not the only factor – rising labour costs and an increasing reluctance in China to produce low-cost goods were prompting the sourcing caravan to move on even before the trade war began. There is no doubt Trump sped up their departure, however.