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RMB Appreciation Affects Textile And Garment Industry

2008/4/19 11:29:00 42

The Appreciation Of RMB Will Impact The Textile And Garment Industry.

Now, the textile industry has been affected by the initiative quota policy and the reduction of the export tax rebate rate. With the appreciation of the renminbi, the operating profit of the textile industry's export products will also decline to varying degrees.

Some Jiangsu enterprises have begun to seek new export models.

According to estimates from the parties concerned, the appreciation of the cotton industry will decrease by 12%, the wool textile industry will drop by 8%, the garment industry will drop by about 13%, and the garment industry with a higher dependence on exports will suffer a greater loss of 1%.

Dong Qibin, chairman of Jiangsu sainty Limited by Share Ltd, told reporters that Jiangsu sainty is actively responding to the risks of export tax and exchange rate adjustment.

The response measures are concentrated in two aspects: first, choose the customers with strong, reputable and long-term cooperation to jointly resolve the risk of tax increase through consultation.

Dong Qibin said that through the comparison and selection of customers, the company chooses foreign large traders and department stores with good commercial reputation and strong economic strength as strategic partners to achieve long-term cooperation with each other in strong combination and complementary advantages. This makes the company always occupy a strong position in the market, thus firmly establishing the competitive advantage that stands out among many competitors.

Two, we should adjust the structure of import and export commodities, not be low-grade and high-grade, increase the proportion of imports appropriately, do more import processing business, and do more new projects.

Jiangsu sainty has already begun to adjust its products continuously, and strive to get rid of the low price competition mode, and support the export oriented products to a large and medium class with large scale, specialization, deep processing and high added value under the support of large-scale and modern industrial bases.

Fan Yuntao of Jiangsu textile believes that the textile industry is one of the most competitive industries in China. The impact of exchange rate adjustment is closely related to the structure of export varieties.

The export of bulk, low-grade and primary products will bear the brunt. For example, the competitiveness of cotton and grey fabrics has declined in the Southeast Asian countries, and the price level is almost the same. If the exchange rate even goes up slightly, it may be completely annihilated.

The adjustment of currency value is to adjust competitiveness, and the export situation of primary products is grim.

Although the domestic textile industry chain is sound and developed, it can provide a series of processing from gray cloth to printing and dyeing, finishing and so on, which is a positive factor for China's textile industry.

However, the impact of the industrial chain is still uncertain, and there are many factors that affect the market. Nor is the pure economic model able to explain and predict clearly.

Fan Yuntao said that the export of deep-processing clothing with overall competitive advantage will be affected relatively low.

However, the proportion of domestic textile enterprises' own breeds is relatively low, and this way is still a long way to go.

Jiangsu textile has been working hard to enhance its marketing and differentiation strategy, but at present, the export proportion of finished products is still less than 40%. As an exporters, it is imperative to develop towards the direction of finished products and deep processing.

According to experts, after the appreciation of RMB, due to the limited bargaining power, although part of the increase can be passed on to importers or suppliers, most of them still need export enterprises to bear, resulting in a decline in profit margins.

Among them, the clothing industry of the terminal was the most affected, followed by weaving and printing and dyeing, chemical fiber also affected, textile machinery, embroidery and other industries also began to be implicated.

Therefore, in the face of severe challenges, textile enterprises are determined to accelerate the adjustment and speed up the pformation is imminent.

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