WASHINGTON — The China State Council, the country’s central cabinet, on Friday unveiled a three-year stimulus plan to help the nation’s ailing textile sector.
The council said the plan is intended to “ensure stable development in the industry and upgrade its structure,” according to the state-sponsored Xinhua news agency. Specific details of the stimulus plan were not immediately reported.
China has rolled out a series of steps to aid its textile and apparel industries following a dramatic decline in exports last year, which has driven thousands of factory closures.
Imports of textiles and apparel to the U.S. from China have also fallen recently. According to the most recent U.S. government figures, imports of textiles and apparel declined 7.1 percent in dollar value in the first two months of the year versus the first two months of 2008.
The Chinese plan unveiled Friday predicted that annual production of large textile companies, defined as those with annual revenue of more than 5 million yuan, or $732,000 at current exchange, is expected to increase 10 percent compared with a year earlier, Xinhua reported. Combined textile and garment exports would grow 8 percent annually to $240 billion by 2011, if the plan is fulfilled, Xinhua said.
The plan would also “do more to eliminate obsolete capacity, reduce energy consumption and increase efficiency in the textile industry,” Xinhua reported. Those steps were previously outlined. Last month, the state council announced its fifth export tax rebate since August 2008, raising export tax rebates to 16 percent from 15 percent. In its newest plan, a further increase in export tax rebate rates was suggested, Xinhua said.
According to other media reports, the government urged Chinese textile producers to export more and encouraged companies to explore mergers and acquisitions. The Chinese government also indicated that it would actively explore emerging markets to help grow textile exports, reports said.