2. Adjustment of the Organizational Structure
The adjustment will help form many large enterprises and enterprise groups, which will possess their own well-known brands, independent intellectual property rights and outstanding main-business and strong-core competence. By 2005, the number of enterprises with an output of over 100,000 tons in the chemical fiber industry will increase from seven to about 20. The rate of production concentration will reach 60 percent. The development of non-State-owned enterprises, private, individual and foreign-invested companies will be encouraged.

The development of small and medium-sized enterprises that can provide services for the textiles industry and society will also be encouraged. To motivate the development of the urban textile industry, labor-intensive industries, such as garment making, knitting and wool-knitting processing, will be promoted by relying on large-scale markets. The country will encourage the development of and provide support to small and medium-sized scientific and technological enterprises that can provide technology, design and information services to make them an important part of the technological progress of the textiles industry.

3. Adjustment of Regional Structure

The move will help make full use of the regional comparative advantages. China will encourage cross-regional, cross-industrial and cross-ownership-type unifications with eastern and western regions to achieve mutual development via advantage complements.

4. The acceleration of the adjustment of the State-owned economic pattern and the enhancement of the strategic reorganization of the State-owned enterprises.

5. The promotion of information construction: The country will increase the overall competitiveness of its industry through information construction and application of information technology; conditions will be made to give full play to the industrial advantages to help the textile industry realize a booming development.

Development review of the textile industry

In 2000, there were 18,900 textile enterprises, including State-owned enterprises and non-State-owned enterprises with a respective annual sales revenue of over 5 million yuan. Total assets were 977.3 billion yuan and the industrial added value was 267.8 billion yuan, accounting for 11.9, 8.3 and 11.3 percent of the figures from the nation's total large-scale enterprises.

The total number of employees in the industry was 13 million; total profit tax was 57.88 billion yuan; total volume of processed textile fibers, 12.1 million tons; fiber consumption per capita, 6.6 kilograms; yarn output, 6.575 million tons; chemical fiber output, 6.942 million tons; garments output, 16.5 billion pieces. The output of yarn, fabric, wool fabric, silk products, chemical fibers and garments all ranked number one in the world, which made China the largest textile-garment-producing nation.

China's textile apparel exports amounted to US$52.08 billion in 2000, accounting for 20.9 percent of China's total exports and about 13 percent of the total volume of the world's textiles apparel trade. During the Ninth Five-Year Plan period (1995-2000), China's accumulative textile apparel exports numbered US$221.5 billion; its net foreign-exchange income was US$170 billion, which made the textile industry the major industry of foreign-exchange earnings.

In 2000 State-owned enterprise and State-owned holdings company assets were 452.2 billion yuan, accounting for 46.3 percent of total industry assets. But the industrial-increased value of all State-owned enterprises only accounted for 29.8 percent of the entire textile industry; profits only accounted for 23.1 percent of the industry. The rate of State-owned enterprises that made a loss was 31 percent -- 10 percent more than the industry average.

During the Ninth Five Year Plan period, the textile industry had basically achieved its main goals through structural adjustment, which was undertaken with initial success.

The task of reversing the difficult situation of the State-owned enterprises was basically complete. In 1997, the Central Economic Working Conference proposed three major tasks to decrease spindles, downsize enterprises and turn losses into profits for the textiles industry. By the end of 2000, the accumulative cut of cotton-spinning capacity was 9.4 million spindles, the decrease of wool-spinning capacity was 280,000 spindles and the decreased silk-reeling capacity was one million thread ends.

Reducing total capacity, the textile industry combined the reduction of spindles, structural adjustment and re-organization of assets. It made full use of the policies regarding company mergers and bankruptcy and the policy regarding debt-into-shares to implement the strategic adjustment of the textile industry.

The level of processing technology and equipment has been increased remarkably. During the Ninth Five Year Plan period, through technological innovation and the implementation of basic construction projects, the production capacity of chemical fibers jumped over three million tons and the differentiation rate was also greatly boosted.

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