If there were no textile quotas, China would be the first choice, partly because of the country's huge domestic market, she said at a seminar in Hong Kong yesterday.

'I rank China as top of my priority. Whether or not the jobs are relocated to China, we are not sure,' she said.

'The US action has increased uncertainty for the global textile industry. I put Vietnam next, just in case.'

The Sino-US trade dispute could result in temporary quotas being imposed on Chinese textile imports to the US.

Hong Kong-based Esquel has 23,800 factory workers and 2,950 other staff in the mainland and Hong Kong. In addition, it has 15,100 factory workers in Malaysia, Vietnam, Mauritius and Sri Lanka, plus 2,850 other staff around the world.

It farms cotton in Xinjiang province, which is woven into fabrics at its other facilities and finally supplied to international clothing brands such as Hugo Boss and Land's End.

The private company produces 54 million garments a year, with 65 per cent sold to the US.

Ms Yang said the uncertainty over the US-China quota dispute was too complex to warrant a simple answer to Esquel's job-allocation puzzle, and the company had studied many possible scenarios.

Esquel's final decision will also depend on other factors. For instance, if the US concluded a free-trade agreement with Sri Lanka, Esquel would move more jobs and resources to Sri Lanka, she said.

Gordon Yen, an assistant to the chairman of textile firm Fountain Set (Holdings), said that with the lifting of global textile quotas by 2005, 'it is possible we will see some dramatic changes in the next three years as to the key players in the industry globally, the buying patterns of big retailers and brands'.

Mr Yen said the impact of US quotas could be lessened by the opportunities arising from the lifting of global quotas, with Southeast Asian garment manufacturers - a key fabric market for China - expected to step up production.