ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Friday, September 20, 1996 TAG: 9609200007
SECTION: BUSINESS PAGE: A-5 EDITION: METRO
SOURCE: Associated Press
How can textiles be hurting when the ``Made in China'' label is stitched on so much exported clothing?
Just as the American textile industry was battered by competition from cheap Chinese goods, China now faces the same kind of competition from lower-wage countries such as India and Vietnam.
In Shanghai, the traditional home of China's textile industry, only about one-third of the state-owned textile businesses are profitable. A third break even, and the remaining third are in debt.
Nationwide, the situation is worse: Three of every four Chinese textile plants operate in the red, with losses totaling the equivalent of $240 million last year.
Nearly half of all state-owned enterprises of all types lose money. Officials blame poor management, lack of development funds, outdated technology and high production costs.
State enterprises employ about 100 million people.
About one-third of them are surplus workers, who get paid but have nothing to do.
Selling the big enterprises to private owners is not under consideration. Jiang Zemin, the Communist Party general secretary, has ruled such a move out, saying it is contrary to socialism.
Some of the better-run companies will get more government investment. Those that are hopelessly in debt are being shut down or merged with healthy companies.
LENGTH: Short : 37 linesby CNB