Du Yuzhou: Advancing Towards A Strong Textile Country

In International

Reporter: the textile industry has always been the national economy of our country.

Du Yuzhou: from the statistical data, the development of China's textile industry has entered the bottom of this year 1 - February.

In the meantime, the total industrial output value of more than 50 thousand enterprises above designated size increased by 2.63% compared with the same period last year, the growth rate dropped by 13.92 percentage points, the negative growth of textile and clothing exports was 14.78%, the total profit of Enterprises above the total scale increased by 11.01%, the loss of enterprises reached 25.17%, and the number of employees decreased by 490 thousand at the end of last year.

What is even more worrying is the polarization of the textile industry.

Nearly 1/3 enterprises, about 1.6 million households, sales revenue increased by 11.28%, total profit grew 34.23%, and the overall sales profit rate increased 1.6 percentage points over the previous year, of which 4376 enterprises sales revenue grew 12.48%, total profit increased 54.92%, and the average profit rate reached 17.41%.

Nearly 34 thousand of 2/3 enterprises are at the edge of loss or loss, and 12644 of them have a 23% decline in sales, with an average profit margin of -9.26%.

To analyze this problem, we can get a profound revelation: the ability to resist risks is not the scale, but the mode of growth, the product structure.

Large enterprises accounted for 0.52% of the more than 50 thousand enterprises above Designated Size, 1 - February average profit rate was 2.81%, medium-sized enterprises accounted for 8.4%, the average profit rate was 2.35%, small enterprises accounted for 91.08%, and the average profit rate was 3.30%.

Visible loss of large enterprises, many profitable small businesses.

Enterprises with a total number of 2/3 are in a predicament, exposing the risks and problems accumulated over a long period of extensive development, and the enterprises that account for the total number of 1/3 are in the opposite direction, representing the direction of the whole industry's structural adjustment and upgrading.

Reporter: in order to win the challenge, the central government made decisive decisions and constantly improved the package plan to deal with the international financial crisis.

One important aspect is the formulation and implementation of the adjustment and revitalization plan of the 10 key industries, including the textile industry.

What positive changes have been brought to China's textile industry by the implementation of this plan?

Du Yuzhou: since the second half of 2008, the central government has continuously increased the export tax rebate rate of textiles and garments for 4 consecutive times, from 11% to 16%. It has played an important role in restoring the international competitive position and stabilizing the market share of China's textile and clothing industry.

In April this year, the State Council promulgated the "textile industry readjustment and revitalization plan" (hereinafter referred to as "planning"), a clear positioning for the textile industry, greatly encouraged the industry to overcome difficulties and achieve sustainable and stable development in the medium and long term confidence.

In the near future, we have conscientiously implemented the Central Committee's overall requirements for "ensuring growth, expanding domestic demand and adjusting the structure", improving the ability to expand domestic and foreign markets, focusing on independent innovation, technological pformation and optimized layout, and promoting the restructuring and upgrading of the textile industry.

First, the growth rate of production continued to rise. The cumulative growth rate of textile industry output reached 3, 3.65%, 4.26%, 5.21%, 6.44% and 6.84% in the year to July.

Two, in the continuous downturn of the international market, China's textile and clothing exports decreased by 10.87% in June, but narrowed by 3.91 percentage points from the end of February.

Three, domestic demand has played a greater role in boosting industry growth.

In 1 - February, the value of domestic sales increased by 6.63%, and the growth rate of domestic sales in 3 - July was 7.8%, 8.57%, 9.42%, 10.72% and 11.14% respectively.

The four is the monthly recovery of fixed assets investment, which has been growing in April and has increased by 6.35% in June.

The five is that industry efficiency rebounded month by month. From 1 to May, the profits of Enterprises above Designated Size declined, but their profit margins narrowed to -0.14%, of which 3 - May total profit grew 5.06%.

Six, the growth rate of the industry's value added rebounded month by month. The cumulative growth rate of 2 to July was 5.8%, 6.1%, 8.2%, 7.4%, 8.2% and 8.5%, respectively, indicating that the quality and efficiency have been increasing.

At present, China's textile industry is in a critical period of stabilization and recovery.

Maintaining this momentum is an arduous task, because the adverse impact of the international financial crisis on China has not weakened, and the situation of external demand shrinking has been continuing. The pressure of devaluation of the US dollar, euro and neighboring countries on China's exports has increased, and the demand growth in the domestic market has not yet recovered to the previous level.

It can be said that the foundation of China's textile industry to stabilize and rebound is still not stable, and it is still necessary to redouble its efforts to restore normal growth.

Reporter: as you have said many times, the international financial crisis has brought challenges to the textile industry, and it also provides impetus for us to adjust the structure and change the mode of economic growth.

How do you think about this problem?

Du Yuzhou: in the past 60 years since the founding of new China, the textile industry has made great progress.

As early as the end of last century, China was already the largest textile producer, consumer and exporter in the world.

In the new century, as China enters the new era of building a well-off society in an all-round way, the textile industry has also entered a new journey from a big producer to a powerful country.

Over the past year, although the textile industry has been seriously affected by the international financial crisis and the world economic recession, under the correct leadership of the CPC Central Committee and the State Council, especially the timely formulation and rapid implementation of the plan, it has ensured that the fundamentals of the textile industry from big powers to great powers have not changed.

For the impact of this international financial crisis, we must look at it from the perspective of development.

First of all, the international financial crisis has made a huge impact on China's textile industry from outside, but in a sense, it also provides us with a clear understanding and efforts to solve the internal structural problems of the industry.

Whether it is the central government or the local government and enterprises, they feel the urgency of speeding up the adjustment of industrial structure and changing the way of development, which is particularly prominent in the textile industry.

Therefore, the timing of the "planning" has been well handled, the problems have been found accurately and the measures are targeted.

At present and in the coming period, our primary task is to conscientiously implement the plan.

As long as the plan is put in place, China's textile industry will break through the difficulties and achieve a new leap forward.

Secondly, the crisis stems from the "profit", greed and destruction inherent in "capital", which will inevitably cause people to focus on the existing economic mode and behavior.

Every big crisis will bring profound adjustments and changes to the world's mode of production, economic structure, political structure and people's way of life and ideology.

The international financial crisis will also bring profound changes to the world textile industry, which will provide a rare historical opportunity for China's textile industry to seize the new commanding heights.

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Reporter: I agree with your analysis. This international financial crisis can not change the trend of our pformation to a strong textile industrial country. This is not our arrogance, but has a realistic basis and a practical basis.

Could you tell us what the main realistic basis for the leap forward development of China's textile industry is?

Du Yuzhou: first, China's textile industry has a solid foundation.

After the founding of new China, under the leadership of the Communist Party of China, with the spirit of self-reliance and arduous pioneering work, the Chinese people basically built a complete textile industry system in the late 70s of last century, basically meeting the increasing clothing consumption demand of the people.

After the reform and opening up, the productive forces were once again liberated and developed. The textile industry first realized marketization and stepped onto the international market.

By the end of the last century, China's fiber processing accounted for 27.5% of the world's total. In 2000, textile and clothing exports accounted for 14.8% of the world's total, and export trade surplus was 40 billion US dollars. The domestic per capita fiber consumption rose from 2.9 kg in 1978 to 8.2 kg, from the world average 1/3 to the average level.

Two, China has a very wide domestic market.

After entering the new century, the grand goal of building a well-off society in an all-round way has created the most important and reliable domestic demand for China's textile industry from a big country to a powerful country.

China's per capita GDP exceeds 1000 US dollars since 2001.

According to world experience, the per capita GDP of US $1000 is a new starting point for the rapid growth of textile consumption.

In terms of per capita fiber consumption, China was 4 kilograms per capita in 1980, and 8.2 kilograms per capita in 2000. It took 20 years for the per capita consumption to double, and from 2000 to 2007, it took only 7 years to reach 15 kg per capita.

From this perspective, with the improvement of people's living quality, clothing consumption will not only increase in quantity, but also upgrade in quality, which will provide a broad domestic market for the pformation and development of China's textile industry.

In recent years, with sustained and rapid development of China's economy and society, Scientific Outlook on Development has been gradually implemented, and the rapid development of agriculture, consumer goods industry, heavy chemical industry, information and communication technology has brought new requirements for the pformation and upgrading of the textile industry, and has created new favorable conditions for its accelerated development.

Three, the international environment is very favorable.

This is mainly manifested in two aspects.

First, the further development of economic globalization, especially China's accession to the WTO in 2001, has broken the long term restraint of China's discriminatory trade policies in the world's major markets, and provided greater international development space for the textile industry.

Actively participating in international competition will help speed up the internationalization process of China's textile industry and help China's vertical and horizontal participation in the international industrial division and enhance the advantage of backwardness.

The two is the in-depth development of the new scientific and technological revolution which started in the middle and late of last century. It provided a strong impetus for the upgrading of the competitiveness of the traditional textile industry and the change of production mode, exchange mode and consumption mode.

In the new century, China's textile industry has entered the fastest growing capacity for innovation, with the greatest progress in the functional and performance differentiation of new fiber materials, new processes and equipment, and the most prosperous period of supply system construction, upgrading of industrial organization structure and development of independent brands.

Reporter: these factors provide a realistic possibility for us to pform into a strong textile country. But what is the main contradiction to achieve this pformation? Where is the solution?

Du Yuzhou: Although China's textile industry is moving from a big country to a powerful country, it faces historical opportunities, but there are also some difficulties that can not be ignored.

The most outstanding difficulty at present is that the structural contradictions accumulated in the traditional extensive development mode have not yet been fundamentally solved.

The situation has made us more soberly aware that only by conscientiously implementing the Scientific Outlook on Development and restructuring the development mode with structural adjustment is the best path for China's textile industry to achieve sound and rapid development.

It is necessary to pform from the main advantage of labor cost to the competitive advantage that relies mainly on innovation.

In the future, the comparative advantage of our labor force will still exist for quite a long time. But we should see that under the rapid economic development, the labor cost is rising rapidly, and the comparative advantage of the labor force will continue to weaken.

For textile industry, there are two ways to solve this problem: first, to accelerate the structural adjustment to achieve the extension of comparative advantage; the two is to promote the upgrading of comparative advantage by improving the ability of innovation.

That is to say, our country should promote the pformation of factor endowments from endogenous comparative advantage (simple labor) to endogenous comparative advantage (complex labor), and promote the upgrading of industries from low end to middle and high level in the depth of participation in the international industrial chain's vertical and horizontal division of labor, and expand the space for obtaining high value-added industries.

We should pform from resource consumption development mode to resource-saving and environment-friendly development mode.

In recent years, relying on rural reform and agricultural science and technology progress, China's cotton yield and total output rank first in the world, but it still needs to import cotton and monomer materials needed to produce chemical fiber.

In addition, China's textile industry wastewater discharge accounts for 10% of the total industry in the country, of which 80% is printing and dyeing wastewater.

Therefore, to promote the healthy development of the textile industry, we must focus on developing a resource-saving and environment-friendly industry.

There are mainly three ways: first, to increase the added value of unit fiber products through technological innovation; two, to open up new fiber resources, to develop non cotton renewable natural fibers such as bamboo, linen, silk and wool; three, to vigorously develop the recycling economy, on the one hand, to promote the recycling and recycling of polyester products, chemical fiber and cotton products, and on the other hand, to promote the comprehensive recycling of energy and water resources, and substantially reduce the energy consumption and water consumption of unit value added.

We should continue to promote the pformation of industrial organization structure from small production mode to socialized production mode.

First, we must break the regional market segmentation, promote the inter regional restructuring of industries and enterprises and support the development of industrial clusters; two, we should improve the modern enterprise system, promote the pformation of business mechanism, realize the modernization of management, improve industrial efficiency and competitiveness; three, we should promote the "going out" of domestic enterprises, actively participate in international market competition and international industry mergers and acquisitions, and strive to cultivate pnational corporations and international brands in China's textile industry, and continuously enhance their influence in the division of labor in the international industrial structure.

Reporter: Thank you for accepting our interview.