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Textile manufacturers face challenging conditions
Mar '08
Recent reports show that China is rapidly loosing its competitive edge in the manufacturing sphere. Experts believe that the country needs to increase its marketing ability and profit to ensure a stable global position.

Manufacturers have moved their base to the suburban areas in China or to a different country altogether. This is because increasing cost of production and other factors have considerably reduced the margins resulting in poor production and consequently loss of orders.

Of the 66 foreign investment enterprises in China, more than half are of the opinion that China is no more competitive when it comes to low cost of labor.

Vietnam and India are emerging as the new manufacturing hubs, fast replacing China in the competition.

Moreover, the salary of Chinese workers is likely to increase by around 10 percent every year while the cost of raw material will soar by about 7 percent. This is sure to worsen the situation even further.

To add to the already serious circumstances, the American textile industry is looking for new trade barriers to limit the import of Chinese textile and clothing products.

The American National Council of Textile Organization asserted that the Government of China must restrict supplying allowance to textile industry for entering US market.

To the extent that US has already started carrying out dumping supervision on textile products imported from Vietnam and China is most likely to be the next target.

Manufacturers in China who are already suffering the loss of orders are sure to hit hard if exports to America are also restricted.

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