Tighter bank lending, anxiety over US 'safeguard' quotas restrain investment
The blistering growth of China's textile industry has slowed significantly due to the central government's efforts to cool the economy and fears of future quotas in the United States, industry representatives say.
The mainland's fixed-asset investment in textiles grew 30.17 per cent year on year to 45.8 billion yuan in the first half, compared with year-on-year growth of 114.38 per cent in the first quarter alone, the China National Textile and Apparel Council said yesterday in Beijing.
The growth in the mainland's imports of textile machinery slowed to 3.5 per cent in the first half from 35 per cent a year earlier, according to official data.
ABN Amro analyst Eddie Lau said the slowdown in investment was probably a result of government measures to tighten lending.
'Some textile manufacturers may not have enough working capital after banks stopped lending across the board,' Mr Lau said.
SBI E2-Capital analyst Patricia Yeung said the slowdown in investment in the textile industry was not a surprise, as overall industrial investment in the country had slowed due to tighter credit.
