Experts forecast the processing trade will shore up the country's exports in the face of the Asian financial crisis, reports said. The processing trade, which uses raw materials largely from affected countries, has suffered relatively little since currency devaluations around the region reduced import costs, Xinhua said. Although the neighbouring countries' devalued currencies made their exports attractive, the competition is not seen posing a formidable threat to the mainland's processing business, it said. On one hand, devaluation is seen raising import costs, eroding profit margins, but on the other, the affected countries are not seen to have sufficient production capacity to raise exports significantly, it said. Additionally, only 11 to 15 per cent of the nation's exports overlap with those of the affected countries, it said. In textiles, foreign exporters have been allocated quotas by many Western countries, which nullifies price competition, it said.