China wins applause as economic recovery accelerates
Source: MOFCOM Date: 2009-12-21
CTEI Exclusive: China's retail sales maintain fast growth since Apr., thanks to the nation's consumption-boosting policies. From January to August, the total industrial production value of statistics-worthy Chinese textile enterprises edged up 11.67 percent year-on-year.
Three major manufacturing rebound
One year after China launched the stimulus package and regained economic growth momentum, the textile industry has overcome serious difficulties and has made new developments as policies come to the fore. From January to October, China's production of three main textile products grew at a faster pace this year than last year. Cotton quilt output has increased by approximately 10.36% to 57.67 million pieces; silk quilt 16.70 million pieces, up 15.65%; nonwoven fabric 1.04 million tons, up 26.37%.
In the third quarter, apparel sales of China??s top 100 department stores climbed 20.3 percent from the second quarter, China General Chamber of Commerce said. As consumers picked up shopping this month, apparel sales this month will continue improve.
Growth outlook for the Chinese economy
A bullish growth outlook for the Chinese economy contributed to the growth of output and retail sales of three main products.
Firstly, the per-capita disposable income of urban residents in this year's first three quarters averaged 12,973 yuan ($1,898), representing an increase of 9.3 percent year on year. The per-capita cash income of rural residents averaged 4307 yuan, representing an increase of 8.5 percent year on year, according to The National Bureau of Statistics.
Next, China has a huge geographic diversity and some rural consumers in southern and eastern provinces actually have a very strong purchasing power. A survey carried out by the Ministry of Human Resources and Social Security shows, currently the employment of migrant workers remains stable. In the second quarter, about 1.5097 billion migrant workers entered the labor market, adding 378 million over the former quarter. The government in the next year willl enhance efforts to boost employment, promoting development in rural areas and increasing farmers' earnings.
Moreover, good times are ahead for China??s home textile and nonwovens industries. In Oct., completed construction area accounted for 377 million sq m, advanced by 22.8% compared with last year. Completed resident housing construction area was 312 million sq m, a 25.1% year-on-year increase. Another favorable opportunity: boosted by tax cuts and rural subsidies, auto sales rose 78.6% to 1.31 million units in Oct. in China, which was surpassing the United States this year as the world's largest auto market. It is understood that every year the automobile's non-woven fabric industry production is almost 70 million square meters. It is necessary to seize the current favorable opportunity of industrial adjustment, vigorously promoting the development of the home textile and nonwovens industries.
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Chinese consumer confidence: signs of optimism for next year
The financial crisis won't have too much impact on Chinese consuming market. The upper class may have been affected by the economic downturn, but most people from middle class are not badly hit. Chinese consumers are still willing to spend. China's consumer confidence index (CCI) has risen to 88.5 percent in October from 86 percent in March.
China will continue the proactive fiscal policy and moderately easy monetary policy next year, the Political Bureau of the Communist Party of China (CPC) Central Committee agreed on Nov. 27. More efforts would be made to improve the quality and efficiency of economic growth, to promote the transformation of the economic development pattern and structural adjustments, according to a statement released after the meeting. The Political Bureau vowed to enhance the focus and flexibility of economic policy in the following year according to new situations. It would also further implement and enrich the economic stimulus package to make the economy grow in a more stable, balanced and sustainable way.
During next year's economic work, the government would improve policies to spur consumption and ensure investment grow at a reasonable pace, it said. The government aims to boost domestic demand, especially the sustainable increase in consumption next year. It also vows to improve policies to stabilize external demand, actively increase imports and encourage companies to invest overseas, said the statement.
Chinese consumers are less pessimistic on economy than other countries. According to a survey by Nielsen of 50 countries and regions, only 35 percent of Chinese people believed the domestic economy was in a contraction. The figure was the lowest among the 50 world markets. The textile and apparel industry may best reflect Chinese consumers' willingness to spend.
