GUANGZHOU — While the furniture industry of Guangdong province is benefiting from massive government-subsidized housing projects, it has to cope with a softening domestic economy, a weak global economy, rising costs and the appreciation of the yuan.
The Guangdong Furniture Chamber of Commerce and Guangdong Furniture Industry Institute make the points in their joint report on the industry.
Sizable furniture enterprises in Guangdong generated 130.288 billion yuan ($20.68 billion) in output last year, a year-on-year rise of 17.8 percent, according to the report.
Statistics from the Guangdong Furniture Industry Association indicate the output from the sector in the province stood at 280 billion yuan last year, increasing by 14.3 percent year-on-year and accounting for 27.7 percent of the national total.
Furniture exports from Guangdong rose by 10.4 percent to $14.93 billion last year, which made up 38.4 percent of the national total, according to Guangzhou Customs.
The growth, achieved during an adverse global market, is mainly attributable to a positive turn in the US and European economies toward the end of last year, said Guangzhou Customs.
A strong export growth came from the Association of Southeast Asian Nations thanks to the zero-duty policy and trade-facilitating measures resulting from the building of the China-ASEAN Free Trade Area.
Despite these relatively encouraging results, profit margins in the industry were eroded by the rising costs of labor and raw materials and the appreciation of the yuan. Some export enterprises recorded a more than 40 percent drop in profit margins in the year, according to the joint report.
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