Chinese Textile And Clothing Enterprises Try Water Southeast Asia To Attract Investment "Olive Branch"

In recent years, the investment pace of China's textile and garment enterprises to neighboring countries has gradually accelerated. In April this year, the survey on the status quo and intentions of Chinese enterprises' outward investment released by China Council for the promotion of trade showed that in 2008~2010, 49% of the 344 enterprises that had invested abroad had chosen to invest in Asia.

In the eyes of some analysts, domestic Labor cost The rising price of hydropower resources is the biggest driving force for its camping out. As a matter of fact, under the background of accelerating regional economic integration, enterprises' choice of investment in Southeast Asian countries is no longer simply a cost pressure for escaping. The most important thing is to make good use of the target countries' measures to optimize the allocation of resources and maximize the target market.

　 Investment conditions are in every category.

"We all say that the labor force in Vietnam and Bangladesh is cheap, but we will not act rashly just because of this interest." Many textile companies who plan to invest abroad have a common aspiration. Since the second half of last year, the wages of Chinese textile and garment enterprises have risen significantly, and the monthly salary of skilled workers is as high as 3000~4000 yuan.

The large increase in labor costs has put pressure on many enterprises. By comparison, the monthly salary level of some Southeast Asian countries as low as 100 yuan highlights their advantages. However, in the minds of most enterprises, cheap labor is not the only driving force for enterprises to invest abroad. As far as textile industry is concerned, enterprises in different links of industrial chain have different concerns.

Shandong family cotton spinning Business leaders said cotton resources are the key to their choice of target countries. "The supply of domestic cotton is so tense now. Choosing to invest and build factories in a large cotton producing country like Pakistan can avoid excessive competition with other domestic producers, and enjoy preferential measures including cotton and cotton yarn export.

The export products of Guangdong Silk Textile Group Co. Ltd. are mainly garments. Zhao, Minister of foreign trade of the company, believes that the improvement of the textile industry chain of target countries has a direct impact on the investment decisions of enterprises. "To invest in the production of garment factories, there must be sufficient supply of garment accessories. Otherwise, the production and operation of enterprises will be very troublesome. If the zipper, trimming and packaging need to be imported from the country, the logistics cost of the company will not only increase, but also lead to a delay in delivery, Zhao explained. "In this way, the profits of enterprises on the labor force will be negligible."

Preferential policies show attractiveness

although industry chain Enterprises in different sectors have different views on outward investment, but without exception, these enterprises regard Southeast Asian countries as a hot spot for investment. "Compared with other harsh regions for foreign-funded enterprises, the threshold for entry in Southeast Asia is relatively low, and the relevant policies of these countries are also more attractive. Many entrepreneurs around me also think about investing in this area for this reason. Zhao Minister of Guangdong silk textile group said.

Indeed, in addition to geographical, cultural differences and low labor costs and other factors, some Southeast Asian countries offer generous treatment to investors is making it the most attractive investment place for Chinese enterprises.

Not long ago, the Pakistan textile industry ministry and the Sindh provincial government jointly held a press conference to announce the establishment of the Pakistan Textile City (PakistanTextileCity). The textile city is located in the Gasim port area of Karachi. The responsible person said that the intention of the textile city was not only to promote the development of Pakistan textile industry to high added value, but also to further attract enterprises including China, Turkey and South Korea to invest and set up factories in the park. The park will provide investors with a range of facilities including industrial areas, utility areas, living facilities, power plants, water supply and heating systems, the responsible person said.

Bangladesh is giving investors an attractive red envelope with its preferential tax policy compared to Pakistan's "Textile City" gimmick. Generally speaking, Bangladesh's income tax rate is 37.5%. But for foreign investors, the tax can be waiver in the shortest 5 years. If we choose to invest in garment manufacturing enterprises in Bangladesh's export processing zones, we will be exempt from income tax for 10 years, and the out zone investment will be 5 or 7 years respectively.

In addition to the above two foreign countries, Indonesia is also actively taking measures to attract foreign investment. Lukman, Vice Minister of the Ministry of economic co ordination of Indonesia, said that Indonesia will first improve relevant legal mechanisms, improve the safety of property, and ensure investors' capital and property security. Secondly, the government is planning a nationwide logistics system to facilitate the transportation of products by investors.

Trade and investment yearn for two-way complementarity

Southeast Asian countries can spare no effort to improve their investment environment and attract foreign investment. Besides, the textile enterprises who want to arrange Southeast Asia have a long-term plan besides their local investment policies. "Investment and trade are mutually driven. Enterprises build factories overseas, not only to expand their capacity, but also to tap the local market or" borrow the way "to open up the European and American markets. Mr. Lin, who has many years of overseas experience in business, said Mr. Lin.

"China's textile exports to Japan, Canada and Australia and other markets need to pay about 18%~23% of import and export tariffs, and in Bangladesh produced textile exports to western developed countries, there is no tariff barriers, exports to Europe, Canada, Japan and Australia, can enjoy duty-free treatment, and will not suffer from WTO and EU trade barriers." Mr. Lin, who has often been tossing Southeast Asia, told reporters the advantages of Bangladesh exporting to Europe and the United States. "In fact, many foreign enterprises in the region are investing in this direction." Mr. Lin said.

At present, China's textile and garment enterprises are suffering from cost pressures, including labor, raw materials, energy, tariffs and so on. The tariff reduction and exemption treatment of textile exporting countries represented by Bangladesh will really reduce the burden of textile enterprises to invest locally, and will facilitate the development of European and American markets. The European and American countries have never relaxed their restrictions on the export of our textiles. Recently, the European Union has repeatedly introduced related measures to set obstacles to China's textile exports. The representatives of the enterprises interviewed also hoped for zero trade barriers in Southeast Asian countries to avoid trade disputes between the European and American countries.

It is understood that in Southeast Asian countries, the special care of European and American countries is more than Bangladesh. At present, 28 countries such as the United States, Europe, Japan and other countries give Kampuchea preferential treatment system (GSP). For the Cambodian imports of textile and clothing products, the United States has given more preferential quotas and tariff reductions and exemptions, and the EU has not set limits, and Canada has given preferential treatment measures such as exemption from import tariffs, attracting the textile and garment enterprises headed by China to invest in Kampuchea. China's red bean group has now taken the first step to regard Kampuchea as the "industrial processing" base of the enterprise.