China’s textiles and apparel industry is in the midst of sweeping change, according to a new report, as global trade realignments and sustainability rules reshape business strategies. The country’s vast supplier base continues to anchor international sourcing, though stricter compliance, rising expenses, and evolving workforce dynamics are forcing both policymakers and manufacturers to redefine pathways for resilience and growth in the years ahead.
- China’s textiles and apparel exports accounted for 31.6% of global market share in 2023, valued at nearly $165 billion.
- Workforce strength remains high, with 7.8 million people employed directly in the sector, the majority being women, reflecting its crucial social dimension.
- Climate goals include peaking carbon emissions by 2030 and reaching neutrality by 2060, integrating the sector into national decarbonisation strategies.
- The report China Country Report: Macroeconomic and Sustainability Analysis by Cascale, released September 2025, underpins these findings.
THE REPORT: Cascale’s report examines China’s role in global textiles and apparel supply chains. The report analyses macroeconomic resilience, policy alignment with climate targets, and industry-wide sustainability efforts. It highlights how economic scale, emissions reduction strategies, and workforce considerations converge to shape China’s evolving position as the leading exporter while addressing social responsibility and decarbonisation challenges.
- The report details China’s $19 trillion economy in 2024, underpinned by industrialisation, technological investment, and consumer demand driving the textiles and apparel sector.
- China accounts for nearly one-third of global apparel exports, supported by vertical integration from raw fibre production to finished garments.
- Sustainability frameworks, including “dual carbon” policies and sector-specific roadmaps, guide manufacturers in reducing emissions and aligning with global standards.
- Employment patterns underline the sector’s reach, with millions of jobs linked to manufacturing hubs that continue to shape community livelihoods and industrial participation nationwide.
INDUSTRY CROSSROADS: China’s textiles and apparel sector sits at the heart of both global sourcing and domestic development, meaning its transformation carries broad consequences. Rising wages, climate regulations, and geopolitical shifts test the resilience of this supply chain. As international buyers demand compliance with stricter labour and emissions standards, China’s ability to balance economic priorities with sustainability commitments will determine its long-term competitive position in the consumer goods industry.
- Export diversification is accelerating as Western markets reduce reliance on China, reshaping demand and increasing competition from Bangladesh, Vietnam, and other sourcing hubs.
- Labour costs continue to rise, prompting companies to either adopt automation and higher-value production or relocate basic orders to lower-cost countries.
- Compliance pressures from international regulations, including forced labour bans and carbon border measures, elevate the need for traceability and transparent supply chains.
- The textile sector features explicitly in national climate planning, with regulatory timelines requiring manufacturers to align their practices to broader emissions-reduction commitments.
MEASURING IMPACT: Quantitative indicators from the report highlight China’s central role in textiles and apparel alongside pressing sustainability challenges. The Higg Facility Environmental Module (FEM) scores, employment figures, and export values illustrate both industry strengths and environmental pressures. These benchmarks reveal how energy consumption patterns, carbon emissions, and workforce characteristics shape the trajectory of a sector critical to global supply chains and China’s economic development.
- Higg FEM 2023 data shows China’s average facility score at 49, above the global average of 42, though with significant room for improvement in energy use.
- Nearly 8,000 facilities submitted data, with around half verified, covering tiers from raw material processing through to garment assembly.
- China accounted for 39% of global verified emissions in 2023, totalling 41 megatons of CO2 equivalent, largely from purchased steam use.
- In 2023, China exported more than $293 billion in textiles and apparel combined, reflecting its entrenched scale as the world’s largest supplier across categories.
STRUCTURAL TRANSITION: China’s textiles and apparel industry is transitioning away from a model of scale towards one emphasising technology, design, and efficiency. New investments in advanced machinery and digitisation support competitiveness, while national policies provide incentives for innovation. Alongside productivity gains, government-backed recycling initiatives are setting the stage for systemic waste reduction, positioning the industry to adapt effectively within a global market that increasingly prizes environmental accountability.
- Chinese manufacturers are investing in smart factories, robotics, and AI-driven design to offset rising labour costs and improve efficiency.
- Renewable energy expansion, including wind and solar capacity, is reducing the emissions factor of grid electricity, aiding the industry’s decarbonisation efforts.
- National initiatives promote textile recycling, with plans for a countrywide waste collection and recycling system addressing 20 million tons of discarded textiles annually.
COMPETITIVE REALITY: China remains the world’s largest textiles and apparel exporter, yet competitive pressures are intensifying. Global buyers are reassessing sourcing portfolios, moving routine orders into alternative hubs while keeping higher-value, complex manufacturing rooted in established Chinese facilities. Rising wages, trade disputes, and compliance concerns challenge competitiveness. Nonetheless, China’s scale, vertical integration, and infrastructure continue to anchor its dominant position, with adaptation through automation, inland relocation, and sustainability shaping how the industry responds to global market dynamics.
- China’s apparel export share slipped slightly from 31.7% in 2022 to 31.6% in 2023, reflecting incremental but notable diversification.
- Bangladesh, Vietnam, and other lower-cost hubs are gaining ground, particularly in basic categories where labour cost advantages outweigh China’s efficiency.
- Trade tensions, tariffs and forced labour import bans influence buyer strategies, prompting sourcing diversification across markets.
- Inland provinces like Anhui, Jiangxi, and Xinjiang are attracting investment, leveraging lower costs and local resources to complement coastal production clusters.
WHAT’S AHEAD: China’s textiles and apparel industry faces a series of scheduled milestones that will shape its competitiveness and sustainability profile in the near term. Policy reforms, recycling programmes, and climate action guidelines will intersect with global compliance deadlines. These events offer visibility into how manufacturers, policymakers, and international buyers will adjust strategies as sustainability expectations rise and market competition intensifies over the coming year.
- Authorities have set deadlines for the rollout of expanded waste-handling systems, aiming to integrate fibre recovery and recycling more fully into national textile management by mid-decade.
- Emissions trading expansion and stricter enforcement of industrial carbon peaking guidelines are scheduled for phased implementation by 2030.
- Cascale’s Manufacturer Climate Action Programme continues its 18-month cycles, supporting manufacturers in validating science-aligned targets and accelerating emissions reduction.
- Ongoing automation investments are expected to scale further in 2025, with adoption of robotics and digitisation expanding across manufacturing hubs.
