China's textile industry will see more complex operating environment in 2012

China's domestic and export markets have always been the major pulling power for the development of China's textile industry. Although domestic market grew faster than export market in 2011, its support intensity over the textile industry has been weakened. Industry experts predict that China's textile industry will see more complex operating environment in 2012, the industry has to carefully deal with multiple challenges, if it wants to maintain healthy development.

China Textile Industry Association points out that major operating data of China's textile industry showed a feature of slow decline month by month and quarter by quarter. The industry will face a very complex state in macro environment when entering into 2012;the risks faced by the industry in both domestic and foreign markets still exist.

Sales growth of domestic market slowed in 2011. Overall, though sales growth of clothing and shoes in domestic market was significantly higher than domestic growth level of total social retail sales, it clearly slowed down month by month after entering September. Looking at overall growth rate of domestic market, domestic output growth of China's textile industry over the first 11 months last year significantly came down compared with the first 10 months. At the same time, China's export market was also affected by demand downturn in international market.

Demand uncertainty in international market may increase in 2012, which will significantly affect China's textile and garment exports. Recession in euro zone economy may decay, while international market faces another risk of U.S. debt problem. As weak performance of international market is difficult to improve in the short term, export growth of China's textiles and apparel may continue to decline.

In addition, it should be noted that there are disadvantages in domestic economic growth: such as irritating policy will phase out, severe control policy over real estate will make economic growth further slow down, resources, labor and financial costs will raise operating costs of textile industry. Therefore, in the background of further decline of China's domestic economic growth and rising costs of production and operations, operating pressure of China's textile industry will not be weakened.