Twelve senior College of Textiles students from NC State were given the task of researching “The China Question” for their Textile and Apparel Management Senior Capstone Project. Some may ask, “What is the ‘The China Question?’” The question addresses how the textile industry in China, Hong Kong and Taiwan relates to the textile industry overall and specifically how we are affected at home in the United States. What do we plan to see from this Southeastern Asia region in the future, and how can we prepare for the impact on the production and markets in the textile industry? The students separated into three groups to study the three major players: China, Hong Kong, and Taiwan. Anyone can tell you that there has been a major shift in the textile industry to this region of Asia. Discovering the changes and opportunities in this region became the focus of the three groups. Collaboration among the students to discuss the market focus, business capacity and governmental structure for each respective country was imperative for an accurate understanding of their relations. After studying the countries individually, there was an analysis of how these countries and their futures will affect the textile industry in the United States.

The China Question: project members and advising professors Back row (left-right): Dr. Nancy Cassill, Dr. Robert Barnhardt, Dr. George Hodge Middle row :MattLynch, Adria Gillespie, Jessica Wentz Front row: Jon Black, Megan Huffman, Nicole Thompson, Mendenhall Schroeder, Carolyn Gillikin, Ashley Forsythe, Casey Reinert, Allison Smith, Philip Corriher

China

China has been called the "500-pound gorilla" of the global textile market due to its vast supply of low-cost labor and rapidly growing and developing textile and apparel industry. However, especially as of late, the country has faced conflict and opposition from producers in not only the United States but also smaller, developing countries. Much of this controversy stems from China's participation in the World Trade Organization and the end of quotas in 2005. China has faced criticism for issues and violations concerning intellectual property rights, labor and human rights, environmental abuse and fair trade practices. The country has begun to focus on expanding its core competencies and improving its growing manufacturing strengths in order to expand and sustain its competitiveness. One member of the China group was able to visit the country during the semester and provided valuable insight to all of the teams.

Hong Kong

Hong Kong has adapted to the global marketplace by becoming the “place to be” for doing business in Asia. Hong Kong does not necessarily have the production capabilities of a large country like China, but it does have a very high capacity for managing all the other services required to compete in the textile supply chain, including marketing, distribution, and sourcing experience and relationships with many of the world’s low-cost producers.

Hong Kong’s efficiency and unique business mindset, shaped by its history of economic activity with western nations, have propelled Hong Kong to the status of the world’s second largest apparel exporter. However, these products are produced in foreign countries, exported to Hong Kong, and then re-exported from Hong Kong to its final destination. With the largest and busiest container port in the world, Hong Kong is able to re-export a product within 24 hours of its arrival.

Taiwan

Among the three powers, Taiwan serves as a competitor. Taiwan demonstrates strength through the educational level and technical knowledge of its people. Taiwanese focus on specialty and high margin products and markets overall. Specifically, in textiles, Taiwanese companies specialize in synthetics. Taiwan is under intense pressure from China in business and government relations. Taiwan’s major focus is learning the best strategies to compete with the low labor and overall resources in China, all while maintaining their independence.

Each team was advised by a Textile and Apparel Management professor who provided guidance, insight, and industry contacts for the students. Weekly meetings allowed the groups to coordinate their research and generate additional topics to address for this study. The project began with an analysis of each country's cultural, political, social, economic and textile histories. After establishing this as a basis of study, the teams extensively researched the current status and characteristics of China, Hong Kong and Taiwan's industry and analyzed its future.

These three Asian nations exemplify the evolution of textiles throughout various stages of economic development present in Asia. China represents the low-cost commodity producer, Taiwan’s textile manufacturing focuses on niche products, and Hong Kong is the service-oriented “connector” for the low-cost Asian manufacturers to the rest of the world.

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November 11, 2004