Trade Effects of Textile Industry in the Context of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership

Phan Thanh Hoan ()
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Phan Thanh Hoan: Hue University, Vietnam

Eurasian Journal of Economics and Finance, 2019, vol. 7, issue 4, 50-58

Abstract: Textiles are a sensitive sector in the Comprehensive and Progressive Agreement for TransPacific Partnership (CPTPP). The CPTPP includes Vietnam, a major apparel producer that now mainly sources yarns and fabrics from China and other Asian nations, the agreement could shift global trading patterns for textiles. Canada and Mexico, both significant regional textile markets for the United States, and Japan, a major manufacturer of high-end textiles and industrial fabrics, are also TPP members. Thus, this paper aims to evaluate the trade and welfare effects of textile industry in the context of CPTPP by applying the multi-country partial equilibrium (PE) model (GSIM) designed by World Bank - World Integrated Trade Solution. The results from GSIM model show that textile trading is likely to increase significantly after CPTPP formation. CPTPP members’ export is predicted to increase about US$ 1 billion. Among textile product groups, maximum gains are concentrated on finished textile products (HS chapter 61-63). The welfare for CPTPP’s members are also predicted by the GSIM simulation. As would be expected, the elimination of import tariffs from CPTPP is shown to bring great benefits to textile producers and consumers in the region, however, it also harm all governments’ revenues.

Keywords: CPTPP; Textile; GSIM; Trade Effects; Welfare (search for similar items in EconPapers)
Date: 2019
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