After entering the post-quota era will Chinese textile constitute a threat to other countries because of its large export to the international market? Is it true that the Chinese textile has not been walking toward marketization? Is it dumping products to the international market at costs that cannot be determined? Regarding the above questions Du Yuzhou, president of China National Textile Industry Council, gave answers at a press conference held Thursday.

Development is driven mainly by domestic consumption

Du Yuzhou said the textile industry operated well last year. Sales of the whole industry reached 2.64 trillion yuan in 2004 increasing by 22.79 percent year on year. The development of the textile industry was still driven by domestic consumption. According to statistics export of textile and apparel accounted for 30.25 percent in 2004 while domestic sales represented 69.75 percent. Export of processed fiber contributed to 24 percent while domestic sales accounted for 76 percent. Chinese are becoming increasingly rich and spending more on the consumption of textile and apparel. The development of textile industry is driven by the development of the national economy.

The opening up and development of China's textile industry also creates opportunities for the global textile industry, said Du Yuzhou. According to statistics in 2003, of the capitals actually received by textile companies of scale in China foreign investment and investment from Hong Kong and Macao accounted for 33.6 percent. Within the growth of textile export the proportion of foreign investment was also very large. Statistics from the customs in 2004 show that of the textile export the three forms of foreign-invested enterprises accounted for $33.5 billion, which was over a third - 34.4 percent.

On the other hand, China imported large amounts of products such as textile raw materials and machinery. For example, import of chemical fiber exceeded 10 million tons last year. Cotton import reached 1.8 million tons. These were in addition to other imports such as dyeing chemicals and textile machinery etc. Particularly, China imported more than $12 billion worth of textile machinery each year during the three years spanning from 2002 to 2004, which accounted for 50 percent of domestic investment in equipment. Many of the textile industries need large amount of import.

The textile industry has been fully marketized

Du Yuzhou said the textile industry was among the first to be marketized in China and is also among the most successful. That this is true is shown by: first, the textile industry was among the first to be opened in aspects ranging from products to the prices of capital goods. Since the resources have been allocated by the market rather than by administrative orders the non-state-owned economy in the textile industry developed rapidly. State-owned capitals actually received by enterprises of scale were 13 percent in 2003. Each year the proportion of state-owned enterprises is declining. Among small enterprises 100 percent is of non-state-owned capitals. Now textile enterprises are no longer protected and subsidized by the state and has been fully marketized.

Second, the regional distribution pattern of China's textile industry is developing according to the laws of market and is concentrating in regions where the conditions of market resource allocation are relatively good. For example, textile and apparel industrial concentration zones have formed in the southeast coastal regions, from Shandong to Guangdong, from the Bohai Sea region to the Yangtze Delta and Pearl River Delta. Output value from these regions accounts for 80 percent of total production of the textile industry. This is different from the pattern in the planed economy, which was formed according to regions and required each region to form a complete set. Now the pattern is formed according to the laws of market. This is a manifestation of marketization.

Providing high-quality products to the world

Du Yuzhou said China's textile industry would put emphasis on industrial upgrade depending not on expanding market share with quantity, but on adapting to the market through improving quality, increasing its original technologies and brands and establishing rapid response system. Therefore it would guide large textile companies to the establishment of research centers and the increase of independent patent products and exclusive technologies. The small and medium-sized companies would continue to do a better job in works such as industrial innovation. In a word, the goal is to turn companies' attention to industrial upgrade and brands development.

By People's Daily Online