Govt mulls over new policies to aid textile industry

19 Aug '08

2 min read

Mr Zhu Hong Ren, Director General of Operation Monitoring and Coordinating Bureau of the Ministry of Industry and Information, recently made a statement that apart from the two percent increase of export tax rebate on textile and garment, there are still a number of proposed policy measures in the course of development and study which includes, credit, taxation, policies to support and assist SMEs and encourage enterprises for independent innovation.

Three of the most critical problems being faced by the textile industry include RMB appreciation, increase in labor costs and lack of capital funds due to economic downturn and rising costs. Experts believe that while the first two factors are difficult to change since they are the trend of times, the problem of finance can still be dealt with by means of Government support.

Wioth regard to this, the central bank had released credits totaling to 230 billion yuan with conditions mainly pertaining to the SMEs who are more in need to ease their financial crisis.

In particular, loan increase of the four major state-owned banks and joint-stock commercial banks is 5 percent which will be catered as special loans for SMEs. Besides, those granted by other local financial banks and institutions is at 10 percent.

However, the textile industry has not been very satisfied with the policy since the actual amount of money flowing into the export oriented SMEs is not much and there are still a number of enterprises who are finding it difficult to get required loans from the banks.

Fibre2fashion News Desk - China

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