China's position as the
world's top shoemaker will not be shaken by the closure last year
of a fifth of the manufacturers in Guangdong province, experts have
said.
Shoemaking companies
have been forced out of business amid industrial upgrading, the
Xinhua News Agency reported.
China supplies at least
60 percent of all kinds of footwear to the global market, official
figures show.
Guangdong's shoemaking
firms include mainly small- to medium-sized enterprises (SMEs) such
as shoemaking factories, material processors, machinery
manufacturers and traders, Li Peng, general secretary of the Asian
Footwear Association, said.
The association said
more than 1,000 of the 5,000-6,000 city's shoemaking firms closed
in the first three-quarters of last year.
Their manufacturing
capacity accounted for 10-15 percent of the total industry in
Guangdong, and about 150,000 to 200,000 employees were laid off, Li
said.
However, many industrial
players, including Li, believe the recent trend is a positive sign
for the over-competitive industry. The tightened market could
enhance competition and help reinforce the nation's role as
industry leader, they said.
Figures show the number
of shoemaking factories on the mainland increased from 20,000 to
more than 30,000 between 2002 and 2006, but orders were much
slower, leading to an irrational "price war", experts
said.
Industry newcomers, most
of them SMEs, were further hit by an unfavorable marketing
environment that included the appreciation of the yuan, price hikes
of raw materials, rising labor and land costs, the reduction of the
export refund rate and revised policy on custom duty deposit,
analysts said.
"The industrial
reshuffle has just begun. More SMEs without core competitiveness
will be washed out and those with better technology and sound
internal governance will survive," Xinhua said.
Compared with burgeoning
markets such as Vietnam and India, experts said China still has
advantages in terms of cheap power and water supply, excellent
infrastructure and an integrated industry.
To lower costs and
expand capacity, some large firms in Guangdong have built new
plants in other provinces.
(Xinhua News Agency
February 20, 2008)
