On December 5, 2019, the Thousand-people Textile Congress, including the fourth session of the 6th board of CNTAC, the 2019 China Textile Innovation Conference, the 2019 National Textile Industry Cluster Review Conference, and the Eighth National Textile Innovative Achievements Promotion Conference, was held at the China National Convention Center. Sun Ruizhe, president of China National Textile and Apparel Council, delivered a work report entitled “Work Together to Win the Future, Write a New Chapter in the High-quality Development of the Textile Industry”. The content is as follows.

I. Construction of Chinese Textile Power Has Been Basically Completed

(A) Overview of the Textile Power Achievements

In 2012, in order to meet the development needs of building a well-off society in an all-round way, the CNTAC issued the “Outline of Building a Strong Textile Country (2011-2020)” (hereinafter referred to as the “Outline”). Since the establishment of the goal of a strong country, facing the complex and changing external environment and the new normal of economic development, the Chinese textile industry has closely focused on the decision-making and deployment of the Party Central Committee and the five-sphere integrated plan. (This refers to a plan to promote coordinated economic, political, cultural, social, and ecological advancement.) With the supply-side structural reform and high-quality development as the direction, China’s textile industry has implemented the five development concepts of “innovation, coordination, sustainability, openness, and sharing”. On all fronts new advances have been made for the cause of the textile industry.

China’s textile industry has formed the world’s largest and most complete industrial system. In 2018, the total fiber processing of China’s textile industry accounted for more than half of the world’s total; textile and apparel exports accounted for more than one-third of the world’s total. China’s textile industry was crowned as the national supplier of cloth and made important contributions to the construction of a community of shared future for mankind. The status of the textile industry as a pillar industry of the national economy and important civilian production industry is even more prominent. According to the Fourth National Economic Census, by the end of 2018, the number of corporate entities, total assets, and total operating income in the textile and apparel industry accounted for 9.5%, 4.8%, and 5.4% of the industry, respectively. 11.03 million employees accounted for 9.6% of the industry. The proportion of textile and apparel exports in the country’s total exports of goods was 12%; the net foreign exchange earnings of textiles and garment reached US$ 250.19 billion, accounting for 71.1% of the national trade surplus.

Further detailed development is as follows.

Technology innovation achieved a new leap. The scientific and technological innovation of the textile industry has shifted from a pure “follower”. R&D investment and innovation output have increased significantly in the textile industry. In 2018, the R&D investment intensity of textile enterprises above designated size was 0.9%, which was twice the level in 2011. Among them, the R&D investment intensity of the chemical fiber industry reached 1.34%, 0.46 percentage points higher than that of 2011. The number of effective invention patents in the three industries, i.e., textiles, garment and chemical fiber totaled 18,854, which is 5.6 times than that of 2011; the per capita operating income of textile enterprises above designated size was CNY 758,000, up 46% compared with 2011. And these industries had made major breakthroughs in terms of materials and textile machinery. For example, conventional fibers have taken the lead in the world, and high-performance and highly functional fibers have achieved a change from high-quantity development to high-quality development. Among them, carbon fibers in the civilian field have significant advantages; high-performance fibers such as high-strength and high-modulus polyethylene and meta-aramid have achieved large-scale production and reached international advanced levels; the application of technical textiles accounted for 28% of total fiber processing, including in the field of aerospace, infrastructure, etc. For the textile machinery, its intelligent and sustainable level has been greatly improved, and the overall level and manufacturing capacity are among the highest in the world. At present, China’s textile machinery product sales account for about 50% of the world’s total; domestic market share of China’s textile machinery has reached 80%; key basic parts production of high-end machinery has achieved more than 50% localization rate. The textile industry has become one of the few industrial sectors in China with closed-loop innovation capabilities throughout the industry chain. The systematic innovation advantage makes China’s textile industry increasingly become an important source of global innovative textile technology.

The brand building reached new heights. The textile industry’s brand awareness, design ability, and creativity have been greatly improved, and leapfrog development has been achieved in terms of design quantity, design quality, and design content. The brand system including, manufacturing brands, consumer brands and regional brands is taking shape. Since 2012, “China Fibers Fashion Trends” has released about 150 fiber brands, and the “Fabrics China Competition” has been selected as more than 800 enterprises each year. The Ministry of Industry and Information Technology has announced 46 Textile and Apparel Creative Design Pilot Demonstration Parks (Platforms), which have hatched a large number of textile and apparel brands. Outstanding consumer brands such as Anta, Li Ning, Bosideng, Aimer, and Peacebird have begun to appear on the international stage, and a large number of Chinese designer brands have emerged. Regional brands are developing rapidly. And the 10 “Regional Brand Pilot Areas” identified by CNTAC cover 10,685 companies, and their R&D investment intensity exceeded 1%; 20.2% of companies have established a brand cultivation management system, and 30.7% of the companies have participated in brand professional training; nine regions have carried out social responsibility construction, of which 18.6% of enterprises in three regions have established social responsibility management systems. Textile intangible cultural heritage has achieved creative transformation and innovative development in the industry. The international influence of platforms such as intertextile, CHIC, and China Fashion Week have been significantly enhanced. The rapid development of brand building has played an increasingly important role in building cultural confidence and improving China’s fashion discourse power.

Sustainable development has entered a new stage. Social responsibility has become the consensus of industry development, sustainable development practices are accelerating, and the market for responsible consumption has taken shape. From the supply of raw materials, research and design and processing and manufacturing, the entire manufacturing system is accelerating its transformation towards an ecological and green direction. An industrial system for recycling, sorting and reusing waste textiles is taking shape. Since 2016, in the green manufacturing system carried out by the Ministry of Industry and Information Technology, the textile industry has been selected into 89 types of green products, 69 green factories, and 4 green supply chains. As the industry continues to adjust its industrial structure and eliminate outdated production capacity, the total amount of pollutant emissions has decreased significantly. Since the 12th “Five-Year Plan” period (2010-2015), the water consumption per unit product in the printing and dyeing industry has decreased by 36%, the comprehensive energy consumption per unit product has decreased by 40%, the water reuse rate has reached 40%, and the backward production capacity has been eliminated by 11.6 billion meters. Technological innovation has reached new developed level. Advanced technologies such as energy saving, emission reduction, and resource recycling have achieved rapid promotion and application in the industry. A series of key technologies for clean production, such as low-temperature rapid pretreatment, cold pad-batch dyeing, have achieved breakthroughs and industrialized production; Since 2016, a total of 24 green manufacturing groups and industry standards have been formulated and revised; the products of 27 chemical fiber companies have passed the “green fiber” certification mark. Sustainable practice has laid a solid foundation for the sustainable development of the textile industry, and the textile industry is playing an increasingly important role in building a beautiful China.

As a whole, most indicators of China’s textile industry have reached or even advanced the world’s advanced level. The goal of the textile power planned by the “Outline” has basically been achieved. The Chinese textile industry has become a well-deserved world textile power. The textile industry is experiencing strong vitality in the process of the great rejuvenation of the Chinese nation.

(B) The Development of China’s Textile Industry is Under Pressure

The prospects are bright, but the development is not smooth. Since 2019, affected by factors such as trade disputes and geopolitics, the growth of the world economy has slowed significantly, and international demand has been sluggish. The IMF lowered the global economic growth four times during the beginning of 2019. The World Economic Outlook, released in October, lowered global economic growth rate to 3.0% in 2019. Facing the severe external environment and the pressure of real transformation, the development of the textile industry is in a difficult period.

Production maintained a low growth rate. According to the National Bureau of Statistics, from January to October, the industrial added value of textile enterprises above designated size increased by 2.4% year-on-year, down 0.6 percentage points from the same period of 2018. In all sectors of the industrial chain, except for the chemical fiber industry and the filament weaving industry, where the added value maintained rapid growth, the growth rate of the rest sub-industries slowed down. The added value of the chemical fiber industry from January to October increased by 11.5% year-on-year, 3.3 percentage points higher than the same period of the previous year; the added value of the filament weaving industry increased by 16.2% year-on-year, which was 9.2 percentage points higher than the same period of the previous year. End products were under great pressure. From January to October, the added value of technical textiles and apparel industries grew by 7.2% and 1.0% year-on-year, respectively, and their growth rates slowed down by 1.2 and 3.8 percentage points from the same period of 2018; the added value of the home textiles industry even showed negative growth. From January to October, it decreased by 1.0% year-on-year, and decreased by 5.3 percentage points compared with the same period of 2018. The growth rate of the added value of the textile machinery industry continued to decline, with a year-on-year decrease of 6.0% from January to October, and the growth rate slowed sharply by 17.4 percentage points year-on-year. Downward pressure has increased, and the space for corporate transformation and upgrading has been narrowed to a certain extent, especially for SMEs. Domestic sales growth slowed down. According to data from the National Bureau of Statistics, from January to October, the retail sales of clothing, foot & head wear and knitted goods above the designated size reached CNY 1062.4 billion, up 2.8% year-on-year, and the growth rate was slower by 5.6 percentage points from the same period of 2018. Online retailing still maintained a good growth momentum, but since June there were signs of slowing down month by month. From January to October, the online retail sales of wearing products increased by 7.1% year-on-year, and the growth rates slowed down by 15.4 and 14.3 percentage points from the same period of 2018 and the first half of 2019. The domestic consumption potential needs to be further developed, and the integrated development of traditional retail and online retail need to be upgraded.

The export market was under pressure. Affected by the weakening of the international economic recovery and changes in the trading environment, export pressure in 2019 increased significantly compared with the same period of the previous year, and the adjustment of product structure and market structure accelerated. From January to October, China’s textile and apparel export value reached US$ 232.31 billion, seeing a year-on-year decrease of 2.2%. From the perspective of product structure, from January to October, the value of textile exports increased by 0.8% year-on-year; the value of apparel exports fell by 4.5% year-on-year. From the perspective of export markets, the scale of exports to developed countries has declined, while exports to emerging markets have been more active. From January to October, China’s exports of textiles and apparel to the United States, the European Union, and Japan decreased by 4.5%, 5.0%, and 5.5% year-on-year, respectively; the total exports to countries and regions along the “Belt and Road” increased by 1.3%; and exports to Africa increased by 6.6% year-on-year. With the normalization of trade frictions, companies need to actively adjust their structure.

Industry investment performance was sluggish. Since 2019, affected by insufficient domestic and foreign demand, the textile industry’s willingness to invest has been sluggish, and the decline in investment growth has gradually deepened since June. According to data released from the National Bureau of Statistics, from January to October, the fixed-assets investment of China’s textile industry fell by 7.0% year-on-year. Among them, the completion of fixed assets investment in the textile industry decreased by 8.5% year-on-year; the completion of fixed assets investment in the apparel industry decreased by 0.5% year-on-year; the completion of fixed assets investment in the chemical fiber manufacturing industry declined by 18.6% year-on-year. In terms of different regions, Tianjin and other 5 provinces and cities showed a positive trend of investment in the entire industry chain; Guangdong and Shandong provinces saw rapid declines in the completion of fixed investment in the field of apparel; and Xinjiang province was affected by industrial policy adjustments. From January to October, the investment amount of the textile and chemical fiber industries decreased by 45.5% and 52.3% year-on-year respectively.

The operation quality has fluctuated slightly. Since 2019, the profit pressure of textile companies has increased, and it has become more difficult to improve the quality of operations. According to data from the National Bureau of Statistics, from January to October, the operating income of 34,000 textile enterprises above designated size in the country achieved CNY 4.027 trillion, seeing a year-on-year increase of 0.2%, 3 percentage points lower than the first half of 2019. The total profit reached CNY 168.81 billion, down 8.7% year-on-year. From January to September, the operating profit margin of textile enterprises above designated size was 4.2%, which was 0.4 percentage point lower than the same period of the previous year, and the profitability of the enterprise decreased compared with the same period of the previous year. The cost pressure of enterprises was relatively large, and the fluctuation of operation quality and efficiency needed to be paid full attention to.

In general, under the complex situation of significantly increased risk challenges at home and abroad, since 2019, the downward pressure on the textile industry has increased, but the industry has still played an active role in maintaining steady growth. (To Be Continued)