Regional supply chains and global trade

According to a recent Behind the Seams article, the regional production and trade network (RPTN) concept says that geographically proximate countries form regional supply chains, with three primary textile and apparel regional supply chains in operation: Asia, European and Western Hemisphere. 

In the Asia RPTN, the supply chain dynamic boils down to more economically advanced countries like China, Japan and South Korea suppling textile raw materials to less economically developed countries such as Bangladesh, Cambodia and Vietnam. The article states that the less developed nations are responsible for the most labor-intensive aspects of manufacturing and exporting apparel. 

France, Germany and Italy are the primary textile suppliers in the European RPTN. European Union products are segmented: Poland and Romania typically produce products for mass markets. Italy and France typically produce high-end luxury products. 

Within the Western Hemisphere RPTN, the U.S. is the leading textile supplier. Other countries in North America as well as in Central and South America, such as Mexico and Caribbean nations, assemble imported textiles from the U.S. and elsewhere to create apparel. The majority of clothing produced in the regional network are exported to Canada and the U.S. 

Trends are developing in each of the regions that may warrant attention, according to the article. An increase of the sourcing of textile inputs is happening within the Asian RPTN. In 2017, close to 80 percent of Asian countries’ textile imports came from other Asian countries, up from around 70 percent in the 2000s, stated the article. 

The European Union shows strong, stable regional trade. For instance, in 2017, 68 percent of EU countries’ textile exports and 75 percent of their apparel exports went to other EU countries. 

Within the Western-Hemisphere, textile and apparel supply chain trade flows are showing signs of imbalance, due to competition from Asian manufacturers, the article contends. For example, in 2017, 24.8 percent of North, South and Central American countries’ textile imports and 15.7 percent of their apparel imports came from within the region, a record low in the past 10 years.  

The future will be influenced by several new trade agreements, which may then affect global textile and apparel trade.