4
business
Trade War Stakes:
$27B in Apparel
Imports From China
● This is twice as much as
Vietnam, which was in second
place with $12 billion.
By Kathryn Hopkins
By going into a trade war with China, Pres-
ident Donald Trump is picking a fight with
one of fashion’s best friends.
U.S. retailers sourced almost two and a
half times as much apparel from China last
year than Vietnam, its closest rival. The
commanding lead illustrates just what’s at
stake for the industry as Trump doubles
down on the commercial conflict.
A look into government data showed the
U.S. imported $27 billion worth of apparel
from China last year, accounting for 34
percent of all apparel imports. That is more
than was imported from any other coun-
try, dwarfing second-place Vietnam with
$12 billion and third-place Bangladesh with
$5 billion.
Additional figures from the American
fashion
LVMH Expands Les
Journées Particulières
● The French luxury
conglomerate hopes to draw
more than 150,000 visitors
to the “open days” event,
scheduled for Oct. 12-14.
By Joelle Diderich
The fourth edition of LVMH Moët
Hennessy Louis Vuitton’s Les Journées Par-
ticulières promises to be bigger and better
than ever, with 23 new houses taking part
in the biennial event, which for the first
business
Adrian Cheng’s K11 Malls
Goes Further Upscale
With ‘Musea’ Opening
● Positioned on Hong Kong’s
waterfront, the venue will be
the most premium of all the
K11 art mall concepts.
By Tiffany Ap
HONG KONG — It’s been just about 10
years since New World Development’s
Adrian Cheng first rolled out his K11 art
mall concept fusing together art and retail
spaces with a youth-oriented bent.
Now the Hong Kong business mogul
is ready to evolve his brainchild into its
next iteration in the form of K11 Musea, a
mall integrated into the Victoria Dockside
complex. The larger Kowloon waterfront
development, which includes an office
Apparel & Footwear Association showed
that 72 percent of footwear and 84 percent
of travels goods in the U.S. came from
China last year.
Fashion, alongside most consumer
goods, emerged unscathed last week
when the White House slapped 25 percent
tariffs on $50 billion worth of goods
imported from China.
The duties were intended to punish
China for unfair trade practices, but the
country cried foul and said it would issue
its own tariffs. The situation escalated
Monday when Trump directed U.S. Trade
Representative Robert Lighthizer to
identify another $200 billion of Chinese
imports that could be hit with higher tar-
iffs if China made a move to retaliate.
On top of that, Trump added he would be
ready to double that, pushing the potential
total amount of imports that could be hit to
$450 billion. If this materializes, it would
be almost impossible for the fashion indus-
try not to be impacted.
time will stretch over four continents.
The “open days” event is spreading to
the U.S., Latin America, Australia and New
Zealand, with a total of 13 participating
countries this year, versus six in 2016.
Among the 39 sites that will open to the
public for the first time between Oct. 12
and 14 are a Louis Vuitton prototype work-
shop in Paris; the restored Château de la
Colle Noire, formerly owned by Christian
Dior; the Caffè Cova pastry shop in Milan,
and Newton Vineyard in Napa Valley, Calif.
The conglomerate headed by luxury
The name ‘K11 Musea’
is an abbreviation of
the phrase “a muse
by the sea.”
tower and soon-to-be Rosewood Hotel,
had its phase one coming out party
in April, but the plans for retail were
kept under wraps until now.
If fashion goods aren’t as lucky the
second time and get hit with higher
tariffs, the cost is expected to be passed
on to consumers, who have been fairly
sheltered from the trade war until now.
They could in turn curb spending just at a
time when things were starting looking up
for retailers.
“This is going to be another factor that
contributes to higher price inflation going
forward,” said Frank Badillo, director of
research for Macro Savvy, a market research
and consulting company. “I definitely think
this will affect consumer spending.”
He added that shoppers are already
going to be affected indirectly by the first
wave of tariffs, set to be implemented next
month. As companies have to pay more at
the border to bring in component parts for
a plethora of highly sought-after products,
the cost increases could eventually lead to
higher prices at the tills.
Some experts have suggested that compa-
nies could counter this by moving supply
chains to the likes of Vietnam and Indone-
sia, but that is easier said than done in such
a short time frame.
David French, senior vice president
of government relations at the National
Retail Federation, said: “There won’t be
any time for supply chains to relocate.
That’s what our members are telling us. It
takes years to move large sources of pro-
duction from one country to another. The
higher cost of tariffs will almost certainly
Newton Vineyard
in Napa Valley.
titan Bernard Arnault launched the
initiative in 2011 to counter a perception
that it was only interested in squeezing its
houses for profit, his son Antoine Arnault
told a news conference on Thursday at La
Grande Epicerie de Paris Rive Droite food
market, opened last year.
“I think it’s important to balance this
image of the group, centered on profit and
performance, with the reality,” he said.
“We don’t design our collections or make
decisions in terms of profit or performance
According to the company, which made
the announcement on Thursday, Musea will
still have the signature art aspect of the K11
branding but will be positioned as its most
luxurious in the K11 network — making it
likely to compete with nearby tourist-favor-
ite Harbour City or 1881 Heritage.
The space is to be unveiled in the third
quarter of next year. Comprising 10 floors
and designed principally by James Corner
of James Corner Field Operations and Forth
Bagley of Kohn Pederson Fox, Musea prom-
ises “an extensive selection of international
brands–many of which will be flagships”
and a rotating world-class art collection.
In addition, it will house one of the
world’s largest living walls with a total
surface area of more than 50,000 square
feet of greenery, New World Development
said, and an amphitheater space and
25-foot tall LED screen.
The project is expected to inject some
much-needed life into the promenade,
which despite its enviable location has
been left languishing. One of the water-
front’s main landmarks and few hubs of
activity, the InterContinental Hotel, is set
to close in 2020 to undergo a year-long
june 22, 2018
China's Dominance
In Apparel Imports
2017 U.S. Share of
Apparel Import
Imports Market
(in billions)
World $80 100%
China $27 34%
Vietnam $12 14%
Bangladesh $5 6%
Indonesia $5 6%
India $4 5%
Mexico $4 4%
Honduras $2 3%
Cambodia $2 3%
El Salvador $2 2%
Sri Lanka $2 2%
Source: Commerce Department
be passed onto the consumer.”
Worries over China came as the U.S.’s
trade row has also stepped up a gear
with Europe. On Thursday, the Euro-
pean Commission unveiled higher duties
on 2.8 billion euros worth of imports,
including jewelry, fashion and beauty
goods, in retaliation to U.S. steel and
aluminum tariffs.
targets, but rather in terms of creativity
and desirability for our customers.”
Some 3,000 employees from a total of 56
houses, including Givenchy, Sephora and
Dom Pérignon, will take part in this year’s
edition of the free event, which is expected
to draw a total of more than 150,000
visitors. Arnault said the tickets for Louis
Vuitton and Christian Dior visits usually get
snapped up online in less than one minute.
This year, the group is allowing appli-
cants to create their online profile from
Sept. 13 and pre-register between Sept. 24
and 30, giving them a chance to receive
a priority pass for themselves and up to
three guests.
LVMH will launch an international
advertising campaign across digital, print
and display media to promote the event.
Digital content will include podcasts
featuring some of the group’s employees
talking about their jobs.
plus renovation.
“K11 Musea will also bring great cul-
tural content back to Hong Kong’s Tsim
Sha Tsui waterfront, which has lost its
legendary charm since the late Nineties,”
said Cheng, executive vice chairman and
general manager of New World Develop-
ment. “K11 Musea will be Hong Kong and
Asia’s new cultural destination, where
global Millennials can come together and
discover their muse.”
Currently, five K11 art malls are operat-
ing in Hong Kong, Shanghai, Guangzhou,
Shenyang and Wuhan. Aside from Musea,
four more are planned across the country
in Beijing, Ningbo, Shenzhen and Tianjin.
While this is shaping up to be Cheng’s
most prominent retail-inclusive project in
Hong Kong due its prime placement on
the city’s defining harborfront, it is not
his largest in his hometown. That distinc-
tion belongs to the in-progress airport
development SkyCity, a $2.5 billion, 3.77
million square foot complex for retail,
dining, and entertainment — the largest
of its kind in Hong Kong. In comparison,
Victoria Dockside comes in at three mil-
lion square feet.
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