Textiles in 2009 to face the “cold”?

Before the closing of the Central Economic Work Conference will be security for next year’s economic growth as a primary task at the same time, explicitly pointed out: “speed up the development mode, and promote strategic adjustment of economic structure can not shake the general direction.”

According to the arrangements, in 2009, China will in accordance with the optimization and upgrading of industrial structure and the survival of the fittest requirements, focusing on the development of mitigation and the elimination of bottlenecks and eliminate backward production capacity and accelerate the product to regenerate themselves and enhance the capability of independent innovation and industrial competitiveness.

In the grim situation of the Central Policy signals dual role, as China’s economic operation has an important industry, textiles in 2009, the face of what “cold”?

Textile: multiple burdens “help” difficulties

Status: the first 10 months, China’s textile and garment export growth rate hit a 6-year low. At present, textile enterprises above designated size in about 70% of the average profit margin was 0.1 percent, the textile industry lost two-thirds of the enterprises or in the loss of the edge.

Trend Analysis: With the introduction of a series of policy measures is expected next year, textile enterprises will significantly reduce the tax burden, at the same time, industrial adjustment and upgrade imminent.

The export tax rebate rate increase to improve profitability. State Council executive meeting a few days ago clearly will continue to appropriately raise textile and garment export tax refund rate. This year, the export tax rebate rate increase of 3 percentage points during the year, some textile enterprises reduce the tax burden more than 80 billion yuan. According to the China Textile Industry Association research, some of the basic rebate rate were raised into the actual income in 2009 if the export tax rebate rate to continue to increase, enabling textile industry to obtain greater profitability improvements.

  funds eased. States have made it clear the suspension of the processing trade will be restricted to the management of real margin. Estimates by industry insiders, this policy in 2009 is expected to be the liberation of textile enterprises, funds about 60 billion to improve its cash flow difficulties of the status quo.

Effect of value-added tax reform will gradually appear. January 1 next year onwards, the revised value-added tax reform program launched in transition. After adjusting for textile enterprises will substantially reduce the cost of the purchase of equipment, at the same time increase the size of value-added tax deduction. China Textile Industry Association estimated that in 2009 the textile industry in the purchase of new equipment can cost six billion yuan, increasing 12.0 billion value-added tax deductible.

Policy voice: It is from the Ministry of Information Industry and the latest news, the next step, our country will develop their own clothing brand development of national strategies, the garment industry as an entry point, and promote China’s consumer goods industry overall brand building.

It is learned that the China Textile Industry Association has identified five major investment next year, the industry focused on technological transformation, the effective promotion of the textile industrial upgrading and structural adjustment of the pace.