The National Development and Reform Commission (NDRC) has
predicted that the textile and apparel export this year would top
US$ 165 billion, with a year-on-year growth of 16 percent.
The projected rise is 9 percent less than the growth rate of
last year, which the NDRC attributed in a recent report to the
surging prices of raw materials, lower export tax rebate rates,
rising yuan and trade frictions.
The report said local textile and clothing exporters would
further lose their price advantages as the yuan which has risen by
an aggregated seven percent against US dollar was expected to
appreciate and squeeze profit margin for those low-added-value
textile exporters.
Customs figures revealed that the sector grew by 15.6 percent
year-on-year from January to May, 12.3 percent less than the
national average.
Starting from July 1, the export rebate rates for footware and
headgear dropped from 13 percent to 11 percent, for fabrics from
seven percent to five percent.
Estimates from the China National Textile and Apparel Council
said a two-percentage-point decline in export rebate normally costs
the industry 4.8 billion yuan in profits (about US$ 634.5 million)
and drives down profit margin by 0.26 percentage points.
The NDRC report warned that some domestically-made textile
products might have to be phased out from the European market as a
new regulation simplified as REACH and valid as of June 1 would
impose stringent requirements on the quantity of chemicals in
textile and clothing imports.
The export environments facing China's textile and clothing
companies are getting increasingly uncertain as the EU-China
Textile Agreement and the Sino-US Textile Agreement are due to
expire by the end of this year and next year respectively.
"Anti-dumping, anti-subsidy and technical barriers will pose a
serious menace to the industry," it warns.
Ma Xinzheng, a senior industrial analyst with Webtextile.com,
said that textile companies should sharpen their edges through
diversifying export markets and technical innovation. Focusing on
mere exports volume and getting obsessed with price wars would only
do harm, he said.
(Xinhua News Agency July 18 2007)
