Wenzhou denies manufacturing base is withering

SHANGHAI - Municipal government officials in Wenzhou, Zhejiang province have denied speculation that the city faces the loss of its manufacturing base, as factories close and funds are diverted into capital investment.

"The factory closures are not as severe as is being reported by the media, and the city will never be deserted just because fewer factories are making goods for both the domestic and overseas markets," said Huang Shoujun, director of the Small and Medium-sized Enterprise Department at Wenzhou Economic & Trade Commission.

Wenzhou, which became the birthplace of China's private economy as a producer of tangible goods, is now a center of investment. Recently, there have been media reports of businesses moving their operations out of the city, posing the threat that Wenzhou will lose the advantage of being China's prime manufacturing base.