Textile industry in China
The textile industry in China is the largest in the world in both overall production and exports.[1] China exported $274 billion in textiles in 2013, a volume that was nearly seven times that of India, the second largest exporter with $40 billion in exports.[2]
Competitiveness
In the early stages of the Chinese economy following economic reforms begun in 1978–79, the low cost of labor was an important component of advantage in gaining export market share over other exporting countries.[1]
Wages for blue collar workers have risen rapidly since that period, leading to predictions that textile products from China would no longer be competitive due to loss of low wage advantage.[3] However, other advantages held by China over developing countries including "more efficient supply chain management, more modern infrastructure, and workers’ higher productivity", have allowed Chinese textile producers to keep costs low relative to other producers.[1] American trade statistics show from 2006 to 2014, the average unit price of imports from China slightly increased 0.7% from $1.45/square-meter-equivalent (SME) to $1.46/SME compared to imports from other countries, which increased by 7.9% from $1.97/SME to $2.13/SME.[1]
The industry is undergoing a process of ongoing consolidation in the industry with a future outlook of a handful of manufacturing behemoths.[3] Industry data from the first half of 2013 showed that production from manufacturers with revenue of at least approximately 10 million RMB grew by 13.3%.[3] However, according to an article in Forbes in 2013, the industry is still highly fragmented with approximately 10,000 yarn and fabric makers.[3]
Factories are also moving from rich coastal provinces to the poorer interior in search of lower wage labor. The Esquel Group, the largest cotton shirt maker in the world, had plans in 2015 for a 2 billion yuan ($325 million) factory in Guilin, Guangxi.[4]
A future development expected to boost domestic industry competitiveness is the end of trade protection for domestic cotton growers. The distortions created by the protected market for domestic cotton had made the going rate for cotton in China 45% more expensive than in Vietnam, a key competitor country.[3]
Companies
Among the largest state-owned enterprises in textiles is Shandong Demian Group and private companies are the Esquel Group and Luthai.[3]
References
- 1 2 3 4 "Where is China's Textile and Apparel Industry Going?". China Policy Institute. July 24, 2015.
- ↑ TNN (3 June 2014). "India overtakes Germany and Italy, is new world No. 2 in textile exports". Times of India. Archived from the original on 30 June 2016. Retrieved 2 September 2016.
- 1 2 3 4 5 6 "Where's China's Growth? Textile Industry Is Weaving Expansion". Forbes. August 28, 2013.
- ↑ "Textile industry at the crossroads of change". China Daily. January 5, 2015.
