China: 5% Growth Forecast for Silk & Fabric Exports

Since 1998, there has been a progressive increase in China's exports of silk and its fabrics, especially during the last two years.

It is expected that this year, silk and fabric exports would still increase by more than 5%, although it seems to be difficult to achieve the surprising growth as the previous year.

According to Chen Yiqing, an expert in silk trading and also former vice-general manager of the China National Silk Import & Export Corporation, favorable factors supporting exports are as follows:

Firstly, the world's economy is recovering at a quicker rate. The world's economy is expected to grow by over 4% in 2004, while global trade is to rise by 6-8%, according to the International Monetary Fund. The generally recognized improvement of the world's economy is undoubtedly conducive to China's silk and its fabric exports.

Secondly, the environment of the world's major silk markets will continue to improve, and will be more beneficial to China's export-oriented silk enterprises. For instance, India, acting as the primary source of silk goods for the U.S., imported 15,870 tons of raw silk and its gray from China last year, up by 18.15% from 2002, due to several problems including the poor quality of both silkworm strains and cocoons, and a raw silk shortage, which could not be solved in a short time.

India has been unable to satisfy sharply growing demands for raw silk at home. Although the Indian government imposed some restrictions on silk imports from China for the purpose of protecting domestic cocoon silk production, it had to readjust the prices of imported raw silk downwards in the fourth quarter of last year from Rs 227/kg to Rs 129.

Thirdly, silk reeling and weaving mills in China have received more orders for exports since the beginning of this year. It is reported that 2004 production has been fully planned, and the operation rate of production facilities has been very high recently.