Compression Test &Nbsp; Textile Industry Can Bear RMB 5% Appreciation.

According to the insiders, for the domestic textile and garment industry of the export oriented industry, because of the high degree of dependence on foreign countries and the lack of bargaining power, it is easy to be affected by the RMB exchange rate.

If the RMB appreciates, it will have a negative impact on the export of the textile and garment industry.

Industry experts said that the specific impact on textile industry also depends on the way of RMB exchange rate reform, how to appreciate, the extent of appreciation, and the way to appreciate it.

The appreciation of the renminbi in the second half of this year has been more definite. By the end of the year, if the appreciation rate reaches 3%, it will have a great impact on the domestic textile and garment industry.

Data estimates that the average net profit margin of the domestic textile and garment industry is only 3%-5%.

If the renminbi appreciates, it will not only squeeze the profit margins of the exporters that are not very high, but export demand will also be affected at the same time.

The Ministry of Commerce, the Ministry of industry and the Ministry of Commerce and other ministries have recently measured and investigated the possible impact of RMB appreciation on labour intensive industries and the resilience of the industry.

Experts said that, from a static perspective, the compression test of RMB appreciation in the early stage shows that the textile industry can bear the appreciation rate of RMB 5%. In dynamic terms, there exists polarization phenomenon. Some enterprises can pfer part of the appreciation pressure by raising the price because of the strong bargaining power, so the affordability is higher than 5%, while the uncompetitive enterprises are less willing to withstand the impact, which will be the first to be hit.

At the same time, the appreciation of RMB will also urge the textile industry to have the effect of passive structural adjustment. The revaluation will create a forced mechanism for enterprises. If enterprises do not carry out industrial upgrading and structural adjustment, they may be eliminated, and the industry will also reshuffle.

In the first 5 months of this year, China's textile and apparel exports totaled 70 billion 210 million US dollars, up 19.3% from the same period last year, up 3.75 percentage points compared with the 15.55% growth rate last month.

In May, exports of textiles and clothing were US $16 billion 422 million, an increase of 12.89% over the same period, an increase of 33.45% over the same period.

The industry expects that the sustained two digit growth rate shows that the textile and garment industry is constantly improving. However, at present, under the condition that all kinds of unfavorable factors such as rising cost, increasing competition and the appreciation of the renminbi are superimposed, China's textile and clothing exports still face many pressures.