Five Revitalization Measures To Ease Export Pressure On Textile Enterprises

Yesterday's executive meeting of the State Council deliberated and passed the adjustment and revitalization plan of the textile industry in principle.

The plan puts forward five revitalization measures, namely, coordinating two domestic and international markets, strengthening technological pformation and independent brand building, speeding up the elimination of backward production capacity, optimizing regional layout and increasing fiscal and taxation support.

In this regard, experts believe that in the short term, the export tax rebate rate will be raised to 15%, and the central government will build special funds to support technological pformation.

Shi Hongmei, an analyst with Orient Securities, told reporters that in the short term, there are substantial measures to raise the export tax rebate rate to 15% and that the central government will build special funds to support technological pformation.

"This is another point on the basis of the first two times, which will have a certain effect on the pressure relief of the relevant export enterprises. Theoretically, it is estimated that in 2009, the profit of the industry will increase by 7% (in fact, foreign businessmen will share part), and the profit margin of the industry will be increased by 0.25 percentage points in theory."

She said, "for enterprises in the industry, those companies that are more export oriented than those with strong bargaining power are more sensitive to the increase of the export tax rebate rate, such as Lu Tai, Kim Feida, Vico, Shandong Ruyi and other enterprises."

In the field of special funds to support technological pformation and independent brand, Shi Hongmei believes that the textile industry will be supported by the enterprises that are dominant in scale, technology and industrial chain. In clothing, enterprises with brand and sales channel advantages will be supported.

Of course, the overall amount will not be too much, "too few" can enjoy a very small number of enterprises, textile fields may have Lu Tai, Yantai spandex, etc., clothing may have Metersbonwe, good news birds, seven wolves and so on.

This year, or facing a new pattern, Shi Hongmei pointed out: "revitalization planning has focused on strengthening some things, such as diversifying the export market, such as opening up non European and American markets, expanding domestic demand, supporting small and medium enterprises, focusing on supporting technological pformation in related industries, building independent brands and optimizing industrial layout. The main significance is to highlight the medium and long-term guidance."

She also believes that the most prominent problems facing the textile industry are serious homogenization of production capacity and insufficient internal and external demand.

"The decline in foreign demand is, after all, waiting for the recovery of the real economy. There is no way to revitalize the plan, and domestic demand is slowing down. If we expect the income to decline, it is unlikely that we will liberalize consumption."

She said, "from the stock market perspective, this theme has been hyped up, the market has been reflected in advance, so there is little significance."

Experts said that the essence of the current textile industry's dilemma is homogenization of serious excess capacity, and the sharp collapse of the economic crisis and external demand has only accelerated the process.

At least 30% excess or backward production capacity needs to be phased out in the next two years.

The government should also focus on the long term in order to save the industry, and encourage the backward production capacity to exit orderly through a series of policies to prevent future remanufacturing of new potential crises. At the same time, we must strongly support the merger and reorganization of truly powerful enterprises and increase the concentration of industries. In 2009, the textile industry will be reborn in the fierce elimination and create a new pattern.

According to the latest information released by the Ministry of industry and information technology, the textile industry was affected by the shortage of foreign demand last year, the production was depressed, the export was blocked, and the benefit was declining.

The added value of textile industry increased by 10.3% over the previous year, the growth rate dropped 6.2 percentage points year-on-year, and the value of export delivery increased by 4.7%, down 9.5 percentage points.

Before November, the textile industry realized a profit of 102 billion 600 million yuan, an increase of 36.9% from the same period last year to 0.7%. Among them, the profit of textile and garment industry increased by 9.3% and 13%, and the profit of chemical fiber industry decreased by 74.9%; the deficit of deficit making enterprises was 22 billion 130 million yuan, up 97.7% over the same period, and the deficit reached 20.4%.