In Depth Analysis Of Textile Industry Overcapacity

In the market economy, overcapacity is inevitable. In the market, price is a signal, and the "invisible hand" calls on all enterprises waiting for opportunities to compete and supply, and develops from oversupply to oversupply, leading to overcapacity. Under overcapacity, enterprises are either eliminated under pressure, or reborn in terms of service and innovation. But most of the time, the local government departments will help to preserve the backward production capacity.

In China, many overcapacity phenomena are not the product of market economy, but the accompaniment of government driven investment model. In many industries, overcapacity is due to the government's excessive involvement in microeconomic activities from the very beginning. For example, one in China is engaged in spin In the late 20th century, under the guidance of the government, a large number of enterprises that were on the verge of bankruptcy were acquired under the guidance of the government.

So encouraging enterprises to expand beyond their own capabilities not only distorts the role of market economy, but also artificially increases the risk cost of enterprises and disturbs the normal market order. On the one hand, local governments give money to land and give policies, and all kinds of overt and covert subsidies are made to make enterprises bigger and stronger; On the other hand, the excessive intervention of the government makes investors and creditors of enterprises believe too much in the government's bottom line.

In a certain place in Shandong Province, the local government, out of consideration of finance, taxation and employment, gave a Cotton spinning enterprises Financial, land and other aspects of support, vigorously expand cotton spinning capacity, so overcapacity gradually accumulated, to today, the enterprise closed 40% of the capacity, which can not be said that the local government manipulated the market.

The solution to the problem lies in this. First of all, the competent authorities should control their own hands and do not drive investment at all. Otherwise, the overcapacity in cotton spinning, chemical fiber, machinery and other industries in the textile industry will only continue to be surplus. At the same time, investors should not feel too good about themselves. They will lead the development of the industry, but they will rush in and disperse. Soybean protein fiber is the best example.

The textile industry is not led, let alone planned, Soybean protein fiber The ups and downs of the problem illustrate the essence of the problem. In fact, both industry management departments and textile industry organizations shoulder more important work, that is, to improve the market environment, guide the development of the industry by improving the planning layout and standard setting level, so as to make the environmental cost explicit. Only under the endogenous drive of the market, merger and reorganization or natural elimination, can the problem of overcapacity in the textile industry be well digested.