China textile profits fall for first time in decade

For the first time in a decade, China’s textile industry won't see profit growth.

   Slowing overseas demand for Chinese textiles in 2008 saw the industry make 1.8 percent less in profits from January through November, according to numbers from China’s National Bureau of Statistics. The numbers for December are not expected to salvage the year. It would be the first time since before China’s accession to the WTO that profits haven’t grown year to year.

   The industry made $15.3 billion in those 11 months, but many firms were pushed into the red as exports to Europe and North America slowed to a relative crawl in the second half of 2008. More restrictive labor regulations enacted in January 2008 by the Chinese government also put pressure on textile manufacturers. Losses reported from textile companies doubled through the first 11 months of last year to nearly $4 billion.

   And there may be worse to come.

   Fan Min, chief editor of a weekly textile magazine under China's Ministry of Commerce, told Xinhua that he expected Chinese textile exports to fall 30 percent in the first quarter of 2009, compared to the same quarter in 2008.

Source: CRIEnglish