Chinese companies are cutting job o£♠≈pportunities and relocating factorie∞ s overseas or to lower wage areas i↓ ↑n China. In their reφ∑₩↕port, China is textile industry ™€exported 176 billion US dol✔αlars in 2007 and directly ∑ ×employed about 20 million workers. It iεφΩs now facing a slow downwar☆>←d trend.
According to production data from Januaγ♦ry to February 2008, produ≥<ction increased by 5.7%ε↑ compared to the sam₽♠≥e period in 2007, while ¥ it increased by 19% i★♦n 2007, which is the loε←wer growth rate since 2003. In₹© Guangdong, a southeastern£ ♠≥ province close to Ho ♠≤πng Kong and also the cent₩₹πσer of China is export industry, th©≠♠ere was a good 11.30%≥Ω decline in production•™'↓ from January to February thi"•s year, partly due tα£<o blizzards and the Ch©↕ ↓inese New Year holiday in F↕÷δ♦ebruary. However, at the same time, >₩↔demand from the United States and Europ>σe is also declining.
William Lowry, a major ✘¥ λpurchaser of Chinese clothing and texti¥γles in the United States, sai$©φ↑d in an interview at a major ₹±←import and export fair in China in Ap ™✘ril 2008 that the competitiveness of Ch<$¥inese products is not that strong.
He said, "I am considering♠Ω purchasing goods from oth•♦er countries. China is reduction i₽ ₹n tax refunds and the ♣∞<≈depreciation of the US dollar h₹φave led to a 20% increase i $φn Chinese product prices compa<₩÷≈red to the past." Th♦$erefore, it is not surp₹βrising that according t Ω&o a recent industrial survey, nearly 5✘♦πε0% of China is cotton text×↔≠↕ile industry wants to¶¶≠₹ switch careers because cost expansio→♣π∑n and the appreciation of the Chin$↔ese yuan squeeze corporate profit§λ ₽s.
Mr. Lowry is not aware that the s ↑™∏ituation is different from prev≈↑"ious years. He wants to purc∑↔hase cheap textiles f♠₹♣rom other countries, bu×t in fact, the source of cheaδp goods will be quite limited. India ✘✔×is also telling its own st≈§ ory. The appreciation of the Indian₹$ rupee, soaring fuel ★costs, and soaring c<αotton prices have left Indian textiσ×↓€le companies with no choice but t•>$πo purchase expensive raw materiaδ ls for their products or face bankruptc"•♠™y. For example, MH Tex∏✔tile Mill Co., Ltd. loca∞>ted in the Ahmedabad re¶∑<>gion is continuing to increase its sell•π£"ing price by 15-20%, seeking signi∑α★€ficant cost reduction §>Ωεmeasures to save the company, in÷✔ε"cluding cutting nearly 500 wo→&¶rkers.
In addition, MH Textile Factβ§♥ory has reduced the aver£∑'₩age age of the workforce from 55¶£ to 48 years old, making more use of ←✘cost efficient equipme₩☆€∑nt, saving nearly 25% ®$β±in electricity costs, and shifting≈$ towards a paperless work enviro♥☆•≠nment using complete co$Ω✔mputerization. Even textile gian←∏&®ts such as Arvind Te"↔xtile Factory are actively Ω€δtaking measures to r↑↓"≈educe costs.
Now we have entered '↑an unprecedented era of cost reduction ₽ ¥&in history, where textile mills ad₽opt innovative technologies to imp±→rove electricity efficiency, s ↓ave fuel, compress labor®←₽, and link rewards with net ☆↓λdepartmental productivity g↔¥≤₹rowth.
