Maintaining the industry growth domestic demand market is the primary support for the textile industry

The development of the silk industry cannot be separated from the background of the entire textile industry. The downturn of the textile industry will directly affect the development of the silk industry in China. In 2012, China’s textile industry’s major production and sales indicators continued to grow, but the overall trend of the textile industry has shown a downward trend since the second half of last year.

Relevant data show that in the first quarter of this year, the total growth rate of China's textile and apparel exports has dropped significantly, and the number of exports has definitely decreased. “The domestic demand is already in the end,” said Zhao Mingxia, Director of the Ministry of Industry of the China National Textile and Apparel Council. This year, the proportion of China’s textile domestic output value continues to increase. Although the sales growth rate has shown signs of falling, the domestic demand market will still be textile. The primary support of the industry.

"Despite the current state policy is unlikely to have action to stimulate domestic demand, but the potential of the domestic market is absolutely better than the international market." Zhao Mingxia said.

Since 2012, the international market has generally been sluggish. In developed economies, clothing consumption in Japan continues to be low, EU demand has shrunk, and there have been no obvious signs of improvement. Demand in major emerging markets has also shown a general downward trend.

"If there are no unexpected factors, it is expected that, starting from the second quarter of 2012, driven by the United States and emerging economies, the global economy and the international market are expected to show a gradual trend of stabilization; if the European debt solution can achieve more positive progress, it will return to stability. A good degree is expected to improve." Zhao Mingxia analysis.

Domestically, since 2012, with the steady growth of urban and rural residents' income, the domestic demand for clothing goods in China has continued to expand steadily, but the actual growth rate has dropped significantly compared with the previous year. Among them, due to the persistently high prices of low-demand flexible commodities such as food, weakening the actual purchasing power and crowding out consumer spending, this is an important reason that has caused the actual growth of domestic demand for clothing to decline this year. Contrary to the continuous low trend over the years, domestic consumer prices for clothing have continued to accelerate since last year, reflecting the fact that the large fluctuations in the textile raw material market since last year have already had the effect of curbing end-user consumption. In addition, investment is affected by macro-control policies and exports are decelerated by insufficient external demand, causing a decline in macroeconomic growth, which affects market confidence, lowers consumers’ willingness to consume, and has a significant effect on the consumption of domestic clothing. .

Zhao Mingxia pointed out that with the improvement of income levels of urban and rural residents in China, domestic demand consumption is undergoing continuous expansion and the macroeconomic fundamentals have not changed fundamentally during the upgrade phase. Adhering to the principle of expanding domestic demand is still the basic starting point for China’s macroeconomic control policies this year. Therefore, clothing Domestic retail sales can achieve a nominal growth rate of 15%-20% in the year.

At the same time, the fall in hikes will bring down the animal prices, stabilizing external demand will improve the export status of textiles in China, and the effect of positive fiscal policies will gradually show up. It is expected that this will be the driving force for growth in the domestic demand market since the second quarter of this year.

However, it is worth noting that the pressure of factor cost is increasing. In recent years, the prices of textile raw materials have fluctuated sharply, and the prices of labor, fuel, and other factors of production have continued to rise. As a result, the company’s cost pressures have continued to increase, and the tight supply and demand structure of resources and the elimination of currency liquidity problems will take time. This will determine the cost pressure. General will become the normal operation in the industry.

"Relying on technological progress, improving production and management efficiency to resolve cost pressures, and improving the level of business decision-making to avoid market risks have become an important task for companies," said Zhao Mingxia.

To this end, she suggested that companies should focus on the macroeconomic situation to determine the guiding role of business decision-making, concerned about macroeconomic development and change, grasp the direction and trends of domestic macro-control policies, and timely adjustment of business management strategies.

Correctly understand the inevitability, long-term and arduous nature of the task of transformation and upgrading of the textile industry, change their thinking, concentrate on strengthening their own construction, and improve their ability to withstand and resolve risks.

As the macro-environment will be in a complex state of change for a longer period of time, companies should adopt a prudent business strategy to avoid speculation and behavior.

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