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'Chinese firms should set up production overseas'

21 Jan '16
2 min read

Chinese companies manufacturing textiles should consider setting up their production facilities outside China, feels a top executive of a well-known China based textile-apparel group.

“As China's economy is intertwined with the global economy, the traditional manufacturing industry in the country should extend to the world market,” Frances Chan, chairwoman of Sunshine Group told Fibre2Fashion.com.

“Sunshine Group is planning to set up its own overseas plant to transfer low-end manufacturing, reduce production cost and avoid tariff and currency risk in export markets,” she informed.

Exploring the available options, Chan says that it is worthwhile to launch a project in Ethiopia, which involves the complete value chain from growing cotton to garment manufacturing. According to her, “Ethiopia offers a lot of advantages to the textile industry like plenty of labour force, suitable land for cotton cultivation and enormous demand for textiles and garments. Besides, the textile industry background is weak in Ethiopia and other neighbouring countries.”

Talking about the potential of Southeast Asian countries, she says that the key components which determine the translocation of an enterprise is the market potential capacity as well as preferential policy like government subsidy. “But this will only help run fast temporarily,” she quickly adds.

In view of the fading cost advantage in China, the traditional manufacturing industry in China should upgrade itself with intellectual function, modern design, high production and administration efficiency and strong service system through the integration of internet technology and logistic system to boost its prospective economic future, Chan adds. (MCJ)

Click here to read the complete interview.

Fibre2Fashion News Desk - India

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