Out with the old, in with the new

Jiangsu and Zhejiang, two eastern coastal provinces, have been leading in terms of Chinese economic growth in recent years. But that fact doesn't necessarily indicate that they have no outdated factories and production methods. As China's two major textile manufacturing areas, their focus will be mainly on eliminating old-fashioned machinery and methods.

Among the 66 production facilities that need to be eliminated in Jiangsu, seven relate to the textile industry, while in Zhejiang 17 of 74 outmoded factories are textile companies.

Although the government is resolute, some local companies are turning a blind eye to the MIIT list.

Jiangsu Jinbiao Woolen Textiles, based in Jintan, southern Jiangsu province, must eliminate some 50 machines according to the list - that's equal to annual production of more than 10 million meters of woolen textiles. However, two weeks after the list was released, the company said it was unaware of the MIIT requirements.

"The company is running smoothly. None of the machines you have mentioned is being replaced," says Mao Xiaozhong, a sales manager for the company.

That attitude may be confined to small companies, though. Their larger counterparts are much more likely to introduce the sophisticated machinery that will help boost productivity.

Starting from scratch in 1998, Ling Lanfang is now chairman of Silk Road Holdings Group Co Ltd, a leading manufacturer of Chinese silk, which is based in northern Zhejiang's Huzhou city and has annual sales of 1.8 billion yuan.

Ling's motto is "I will still buy new machines even if I have to sell my underwear", and may well be the secret of his success.

"It means that the new machines weigh way more than my self-esteem," he laughed.

Although China is the biggest textile manufacturer globally, its textile industry, as Ling sees it, still faces two failings. The first is low productivity and the second, the exhaustion of resources.

Silk Road has managed to improve the machines already in service, and increased annual productivity to 4 tons for each worker, compared with the company's previous capacity of 850 kilograms and overtaking the single annual ton made by its Japanese counterparts.