Textile hub Shaoxing marks recovery

Shaoxing city in eastern China's Zhejiang Province, which has the largest textile market in Asia, was hit hard by the global financial crisis. The city underwent a bitter winter last year, with export slumps and factory shut downs. Thanks to both central and local governments' supportive measures, Shaoxing's textile industry saw a recovery in the first quarter.

To pull the city's pillar industry out of a difficult situation, the local government earmarked more than 300 million yuan, or some US $44 million earlier this year to encourage technology innovation. The government has also endeavored to make Shaoxing and its textile industry more known to the outside world to help boost exports.

In the first quarter, both production and sales figures showed positive signs. Chemical fiber output stood at 670 thousand tons, a nearly 30 percent rise from the same period last year. Clothing products reached 120 million pieces, revealing a year-on-year increase of five percent.

Electricity use and discharge capacity, two indicators for measuring industrial development, are also on rise. All these factors indicate a warming up of Shaoxing's textile industry.

In addition, Asia's largest textile market was recently chosen by the central government as the country's exclusive textile machinery design and manufacturing base. Industry insiders say the move will help to make Shaoxing an international textile manufacturing hub and lay a new platform to boost nationwide technology integration and innovation.

In fact, the city never stops its search of research and development.

The Shaoxing based Zhejiang Institute of Modern Textile Industry has been a R&D platform for more than 13 years, serving more than 2,000 textile companies in Zhejiang and other provinces including Jiangsu, Shandong and Shanghai.

Hu Keqin, head of the institute says when fair-average-quality goods were popular; the institute was ignored by many textile enterprises. But now things are different.

"Now dozens of textile companies come to visit us everyday. They even queue a long row outside the office."

Hu Keqin says last year the institute could only receive around 100 orders each month, but now the figures are closer to 300.

Mo Linxiang, a technical manager with Zhejiang Honglvlan Textile, says since the company started cooperating with the institute, they have been able to provide their US and European clients with high-quality textile products featuring new, creative and colorful designs.

"Every year we spend around 800 thousand yuan or US$ 120 thousand to purchase designs from the institute. This has helped our fabric products priced twice than in the past."

The institute, funded by the local government, on average spends 30 million yuan every year in research and development projects. For this reason it can provide better services for textile enterprises.

Besides Zhejiang Institute of Modern Textile Industry, the local government has also funded a 340 million yuan expansion of the China Textile City or CTC in Shaoxing, the largest textile wholesale market in Asia.

Zhou Rusheng, director of China Textile City Construction and Management Committee, highlights the function of the government in promoting economic development.

"Government itself is an organ, providing public service. The China Textile City is also a platform offering public service. The government uses the CTC market to provide a public platform for enterprises, thus to boost economic development."

The government has also provided many preferential policies to attract business operators to CTC and help recover their confidence.

Lei Kai is board chairman of Guangdong based Xinshidai Fabric whose company returned to CTC after six years departure.

"Sometimes what we need is confidence. I think government officials are sincerely hoping to help us in our development."

In the first three months this year, 15 billion yuan worth of deals were made at CTC, a year-on-year rise of 5.8 percent.