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Market demand and technological upgrading were two major factors attributable for China's huge growth of investment in the textile sector last year, a record high in the past 11 years, said an expert with the National Bureau of Statistics.
A leading official with the Investment Department of the bureau, who declined to be named, said a total of 4,584 textile projects were under way last year involving a combined planned investment of 205.5 billion yuan (US$25 billion), up 88.5 percent year on year.
Each of the projects has a budget of at least 5 million yuan (US$609,000), and 88.54 billion yuan (US$10.7 billion) in investment has already been made, up 80.4 percent, the official said.
Growing market demand is the biggest factor as China's textile exports grew to US$61.7 billion in 2002 from US$52.2 billion in 2000, and per-capita domestic fiber consumption was up to 10.8 kg from 8.3 kg during the same period, said the expert.
The textile sector has increased their investment in projects to upgrade their equipment amid fierce market competition and to meet the growing demand for more textile products.
The whole textile sector imported US$11.8 billion worth of textile machinery during 2000 and June of 2003.
China's traditional textile producers, such as Shanghai, Tianjin, Beijing, Qingdao and other major cities, are phasing out their textile production, while many other cities are expanding their textile production by taking advantage of their rich resources and cheaper labor. The fast investment in the textile sector has prompted a shortage of raw materials, increasing cotton imports and price hikes on the international market.
The expert said China's investment in textile sector is likely to drop significantly this year due to soaring cotton prices and dropping profit margins.
(Xinhua News Agency April 13, 2004)
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