Cao Honghui: How can the textile industry break through under the financial crisis?

Mr. Cao Honghui, director of the Financial Market Research Office of the Institute of Finance, Chinese Academy of Social Sciences, was a guest in the live broadcast room.
​
Moderator: Now let’s discuss the current status and countermeasures of China’s textile industry with Mr. Cao Honghui. We all know that China’s textile industry is still in the low-end market of the world’s textile industry and lacks independent research and development and design capabilities. What are the possible impacts in the face of a financial crisis?
​
Cao Honghui: The textile industry dominates China’s exports. China’s textile industry is a completely labor-intensive industry, and its R&D and market development capabilities are at a very immature level. How to deal with this crisis is more important for the textile industry to enhance its own technological innovation capabilities, increase industrial concentration, and strengthen market expansion. Another issue that I am afraid we need to pay attention to is to prevent the impact of exchange rate fluctuations on the textile industry. The average interest rate in the textile industry is low and should be a relatively fragile link in the industry. Therefore, in the future, the entire industry must pay close attention to economic fluctuations and financial markets. Among them, the impact caused by interest rate fluctuations.
​
Moderator: We often say that China’s textile industry must improve its competitiveness in the international market through upgrading and transformation. But now Chinese textile companies are facing a very difficult situation. On the one hand, they want to upgrade, and on the other hand, they have greater demand for high-quality and low-priced products, that is, products with relatively low added value, during the crisis. How can they face this situation? Dilemma?
​
Cao Honghui: The market demand for low-end products is also the largest, but we have also seen that under the impact of the crisis, you used to buy 10 shirts, but now you can only buy 8, which reduces demand. How to reduce contradictions, on the one hand, we must increase the variety of designs, including quality innovation, on the other hand, we must directly increase the development of the terminal market, product development and design, the acquisition or investment in the construction of terminal sales outlets, etc. Or cooperate with overseas terminal sellers, etc., to improve the market competitiveness of products and increase profit levels through various methods, thereby reducing the many risks faced by the Chinese textile industry in the market and improving risk resistance.
​
Moderator: However, some companies have put forward some ideas. Their financial situation is not bad. In their view, this is also the time to acquire upstream companies overseas. Some companies that once provided them with design drawings and once mastered core technologies have acquired through this acquisition. To obtain R&D technology? This is also a very good choice at this time.
​
Cao Honghui: This is a very good thing to note. In the state of global austerity, many funds have begun to reduce investment. If some of our companies have surplus funds, they can increase the acquisition of companies with R&D capabilities and proprietary technologies, which is a very wise choice. , can shorten the time and process of our technological innovation and accelerate the pace of our enterprise development.
​
Moderator: According to the agreement to join the WTO, textile quotas will be abolished next year, which is also a very important opportunity for China’s textile industry.