Textile export growth hits two-year monthly high
Source: Xinhua Date: 2006-12-26
China's textile and clothing exports rose to 12.72 billion US dollars in November, up by 30.85 percent from November last year, the highest monthly growth in two years, Customs figures show.
However, experts warned against believing the high indicated a new wave of rapid export growth. "It's only a temporary flourishing before fading away," the China Securities Journal reported on Monday.
The newspaper, run by Xinhua, attributed the hike to export firms that were catching their last chance to benefit from higher export tax rebates.
The Ministry of Commerce announced in September that tax rebates for textile exports would be cut from 13 to 11 percent, but companies that signed export contracts before September 14 and cleared their goods through the customs before December 14 could still claim the original tax rebates.
The government had hoped the measure would force domestic textile firms to be more aware of technical innovations and to develop more products with proprietary intellectual property rights.
The move coupled with the appreciation of Renminbi , however, has pushed Chinese textile manufacturers to mark down their prices this year to sustain their exports and offset the negative impact of the rising yuan.
"The sudden hike in November will not last long. A decline will appear in December," said the newspaper, adding that overcapacity would continue to haunt the industry despite the rising domestic demand.
Figures from the National Bureau of Statistics show retail sales of clothing in China climbed 21.5 percent in November. The growth was 7.4 percentage points higher than the average.
In the future, the focus of China's textile and clothing industries would gradually shift from abroad to home, said the newspaper.
After the European Union and the United States set caps on China's textile exports in January, more than 69 percent of China-made textiles and clothing have gone to the Association of South East Asian Nations (ASEAN), the Republic of Korea and African countries.
As the textile industries of India, Pakistan and ASEAN are developing fast, domestic competitors could soon lose their comparative advantages in costs, it said.
