The intensification of the trade conflict between the United States and China may result in a surge of Chinese goods entering the European market, raising concerns within the European textile industry. In a surprising shift, U.S. President Donald Trump announced a 90-day “pause” on reciprocal tariffs, excluding those targeting China.
If Trump follows through on his threat, European goods coming into the United States could incur a 20% surcharge. This poses a significant risk to the textile sector, which is already in a state of unease.
“Annual European textile and clothing exports to the United States amount to approximately €7.5 billion. Therefore, should Mr. Trump maintain the 20% surcharge, it would translate to €1.5 billion in tariffs,” explains Dirk Vantyghem, Director General of the European Apparel and Textile Confederation (Euratex).
Countries like Italy, France, and Portugal, prominent players in Europe’s textile industry, are poised to bear the brunt of this situation. Haute couture, in particular, stands to be significantly affected, although some consumers may be willing to absorb the increased costs due to the premium nature of the products.
Additionally, there’s the possibility of increased competition from Asian textiles that may redirect their exports from the U.S. to Europe. “If tariffs are enforced on countries like China, Cambodia, and Vietnam, we could see a surge of Asian-made apparel flooding the European market. The indirect effects could potentially outweigh the direct consequences of the 20% tariff imposed on U.S. imports,” says Vantyghem.
While he does not foresee immediate price increases, he expresses concern over “capacity issues” that could place additional strain on European manufacturers.
In response to these potential challenges, Ursula von der Leyen, President of the European Commission, stated in an interview that she would not allow a wave of Chinese imports to dominate the European market and is prepared to implement “safeguard measures” if necessary.
Euratex has urged the Commission to prioritize dialogue over escalation to prevent a destructive cycle that harms all parties involved. The European textile sector has already been adversely affected by “energy prices” and the compliance costs associated with the EU’s sustainable and circular textiles strategy established in 2022.
This evolving situation could also lead to significant changes in supply chains. Tariffs on Chinese imports have surged to 145%, prompting major European brands to reconsider their sourcing strategies. Although Trump has announced a 90-day reprieve for 75 other countries, the specter of high customs duties looms over them. Under potential tariffs, Bangladesh and Vietnam face hefty surcharges of 37% and 46%, respectively.
“Consequently, many leading European brands are reevaluating their production options,” says the Managing Director of Euratex. Countries like India and Turkey might emerge as favorable alternatives, with proposed surcharges of 26% and 10%, respectively. This shift could incentivize some clothing manufacturers to relocate their production facilities to these nations.
