The U.S. Treasury Department announced on September 25 that it would postpone sanctions on the Xinjiang Production and Construction Corps for two months. U.S. companies now have until November 30 to “end” business dealings with the Xinjiang Production and Construction Corps (originally required to do so by September 30), and naturally the broad ban on Xinjiang cotton, cotton yarn and cotton textile imports has also been extended. The postponement for at least two months has given some U.S. buyers, retail companies, Chinese suppliers, and processing plants a chance to breathe and adjust, and market tension has eased.
Why did the US Treasury Department delay sanctions against the Xinjiang Corps? Industry analysis mainly includes the following points: First, it is for the sake of votes for President Trump. Trump and the White House are worried that once sanctions are imposed on the Xinjiang Production and Construction Corps, not only will it be detrimental to U.S. exports of agricultural products, crude oil and other products, but the financial market and stock market will also be suppressed, which will significantly affect Trump’s approval rating; second, the support of Chinese and American companies The strong reaction caused the White House to be cautious. The World Trade Organization has ruled that the United States violated WTO-related laws by imposing tariffs on more than $200 billion worth of Chinese goods. In the past two years, more than 3,400 U.S. companies have collectively sued the U.S. government, demanding that the government repay part of the taxes they have paid and calling on the U.S. government to change its tariff policy; third, due to the Xinjiang Production and Construction Corps’ relationship with some U.S. companies and trading companies There are extensive cooperation and business exchanges in various industries such as Xinjiang, which are difficult to withdraw or divest in a short period of time; fourth, the implementation of extensive bans on Xinjiang cotton, tomatoes and other products is not only difficult to circumvent the roundabout tactics of Chinese companies, but also detects Costs such as traceability and traceability are relatively high, and it will take time for American companies to accept and digest them.
So how much impact will the U.S. Treasury Department’s two-month delay in imposing sanctions on the Xinjiang Corps have on China’s textile and clothing exports? Some export-oriented enterprises in the coastal areas of Jiangsu, Zhejiang and Guangdong said that it has a positive effect but the actual effect is not outstanding. On the one hand, under the negative impact of the U.S. government’s extensive sanctions on Xinjiang cotton products, not only U.S. purchasing companies and retailers were cautious in placing orders in August/September (some U.S. customers asked Chinese suppliers and processing companies to issue “not used in Xinjiang” “Cotton Products”, but are generally boycotted by Chinese companies), Chinese export companies and foreign trade companies may accept less or refuse orders for U.S. textile clothing, or purchase cotton and cotton yarn from other origins to replace Xinjiang cotton; on the other hand, the U.S. government only Suspend the human rights sanctions against the Xinjiang Production and Construction Corps, rather than cancel them. “Sooner or later, the wolf will come.” Considering that the two parties in the United States have the same purpose of containing China’s development and suppressing China’s economy and enterprises in all aspects, no matter whether Trump is re-elected or Biden comes to power, it will be difficult for China-U.S. relations to improve significantly, so we cannot place our hope on this matter. There’s a turning point. In addition, textile and clothing companies should prepare early for the “evolution” of President Trump and the US government. After all, the United States can “change its face” faster than turning the page of a book. </p
