Data prepared by the State Administration of Textile Industry show that profits totaling 116 million yuan were gained in state textile enterprises in the first 11 months of 1999, lessening losses of 3.204 billion yuan from the same period of 1998. This is the first time state enterprises have made profit following loss-incurring for 6 consecutive years.

The national economic work conference in 1997 set the textile industry as the first target for restructuring loss-making state enterprises. Since then cutback on aggregate production capacity, asset regrouping, restructuring and retrenchment have been carried out in state textile enterprises. As a result, all economic indicators in the textile industry have been improved. In January-November of 1999, the total output value (constant price) in the monitored key state textile enterprises showed a year-on-year hike of 10.4%; the industrial added value (constant price) registered a year-on-year increase of 21.9%; marketing income grew 11.4%; and sales profits went up 19.7%.

By the end of last November, the liability rate in state enterprises dropped 1.2 percentage points from the same period of the previous year; the production-marketing rate improved 1.2 percentage points; finished product equity dropped 12.3%; the rate of circulating equity rose 1.9 percentage points.

A leading official from the State Administration of Textile Industry said that cutback on the aggregate production capacity, curbing overlapping construction and improving management in enterprises have played a vital role in creating an ambience to get the enterprises out of the tight corner. As a result, by the end of last November, per capita productivity in the state textile enterprises went up 25% over the same period of the previous year. In addition, the priority policies ordained by the state over the past two years have also help the loss-incurring enterprises to get out of financial straits. For instance, allocation of export quotas to the self-managed export enterprises has stimulated textile export; the rebate rate for textile and clothing export went up to 15% and 17% respectively. This has given support to restructuring and improved management of textile enterprises. Part of hopeless enterprises went insolvent predicated on the law. Part of the enterprises were revitalized by way of asset regrouping.

The official added that heavy burdens, overstaff and low technological level remain problems facing the textile enterprises. Loss-suffering enterprises mainly concentrate on the eastern coastal areas and the central and western provinces. It was learnt that upgrading of the whole textile trade and restructuring points to the way for the development of the textile industry.