High-Quality Equipment Is Needed

fter almost a decade of constant and rapid growth, Chinese products can no longer rely
only on low selling prices in the competitive markets of the world. Recent Chinese government
directives are attempts to move China’s industries to make higher-value products, and there are
also concerns for the environment. This is especially the case for the textile industry.

Textile manufacturers are increasingly looking for machinery suppliers that can provide them
with competitive products both in technical terms and at prices that enable them to achieve
economic and ecological benefits. In times of shorter batches, flexibility and faster throughput
are key words for success.

According to the latest Chinese customs statistics, apparel export value in first- quarter
2008 reached US$37.44 billion. This is a 19.5-percent growth compared with the same period of 2007.
However, increasing raw material and labor costs are cooling down development. Furthermore,
overcapacities, the positive reception of the renminbi and the significant rise in the euro after
the second half of 2007 – as well as the global economic slowdown and the rise in production costs
– jeopardized business growth.

As everybody said at the recent textile shows in Shanghai, “The money is there, but nobody
wants to invest it at the moment.” This means that the textile industry will have to consolidate
before it can be healthy again. Some experts say the bottom has been hit; but some predict recovery
for the textile industry worldwide will need 12 to 18 months.

However, as recently stated by Fong Sou Lam, chairman of Hong Kong-based Fong’s Industries
Group: “China’s current status as a leading textile producer in the world is undebatable.  …
China does have enough capacity to meet its export demands as well as to satisfy the domestic
market. However, China’s domestic demand for textiles and apparel increased some 25 percent per

“The current financial crisis is affecting textile businesses throughout the world,” Fong
said. “Yet, if we look ahead, we believe Asia as a whole will have the best potential due to its
long-term growth prospects, which will generate and stimulate a significant domestic market for
textile consumption. It will also be the first region to benefit when the export markets recover.”

November/December 2008