US and EC has lifted the import quota on textile industry from 1 January 2005. EC has however has limit China's textile import to EC at 12.5% growth rate. Whereas China negotiation with the US is still on going.
Textile industry is a very labor intensive industry. Base on China agreement with EC. China labor cost has escalated and it textile industry would become uncompetitive after 3 years restriction lapse.
Who is the beneficiary of such liberalism and restriction on China? Ramatex Berhad, Malaysia largest textile manufacturing company, which has investment in China, Cambodia, and Africa would be benefited. It website listed 5 factory in Suzhou, China is under expansion.
In it home country Malaysia. It just obtain a USD10million term loan facilities from from BNP Paribas Labuan Branch. The purpose of the Facility is to finance the capital expenditures and working capital requirements of Tai Wah Garments Industry Sdn. Bhd., which is in tandem with the increase in its business orders. According to announcement to Bursa Malaysia.
Textile industry can be started at very low capital. Ramatex Bhd started with only S$80,000 in 1976. With less than 30 years. It turnover has expand into billion.
Toyota, automobile manufacturer in Japan started from textile manufacturing company. Same as Taiwan's automobile manufacturer, which joint venture with Nissan of Japan. Only Hunydai of South Korea started from contruction industry.
Unfortunately, China unable to follow this path of industrialization process after limitation and restriction from EC and now US.
However, Ramatex Berhad of Malaysia is a beneficiary. Rumors say that it factory in China and Malaysia remain busy, and is expected to announce a favorable result.
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