From The Editor: Adding Value

From The Editor

Adding ValueAs textile news headlines continue to be dominated by China’s export surge and
calls from other textile-producing countries on the World Trade Organization (WTO) to delay lifting
textile quotas past 2005, some in China are suggesting that it’s time for the country to move
beyond its role as the low-cost leader in the commodity textile and garment markets.China Daily, a
Chinese national newspaper, reported recently that an unnamed official from the China Chamber of
Commerce Of Import and Export for Textiles has argued for a “floor price”that Chinese exports
cannot fall below to curb “malicious” post-quota price competition among exporters. In addition, in
this issue’s profile of Weiqiao Textile — China’s largest cotton textile manufacturer — company
executive Wang Donghua says for China to maintain its top position in global textile production,
the long-term strategy has to focus on products with high added value (see page 38).Even the WTO,
in a recently released discussion paper on textile quotas, is saying China likely will be unable to
fend off even lower-cost competition from developing countries. And, more importantly, says the
author of the paper, “China has of yet not shown competitive strength in the design and fashion
segments of the markets.”China (or any country with low labor cost to its advantage) cannot rely
solely on price to compete much longer. The time is now for textile manufacturers to move from a
lowcost strategy to one that adds value to products. Sounds like sage advice to this editor.By
Carmen Pang, Executive

Fall 2004