Looking back at 2018, the overall domestic macroeconomic fundamentals were stable, the textile industry implemented the general requirements for high-quality development, deepened the supply-side structural reform, and maintained stable operation. The industry played a positive role and demonstrated its due responsibility in stabilizing the economy, expanding domestic demand, and resisting risks. The state has introduced a series of important measures to address the difficulties encountered by private and small and medium-sized enterprises, deepen industry-finance cooperation, and stabilize employment, finance, foreign trade, foreign investment, investment, and expectations, which has also boosted the confidence of entrepreneurs.

The Central Economic Work Conference held at the end of 2018, focusing on the new changes in the international and domestic economic situation, released new signals for doing a good job in economic work. The meeting proposed that China's development is still in and will remain in a crucial strategic opportunity period for a long time. The world is facing major changes unseen in a century, and crises and opportunities coexist in these changes, which brings major opportunities for the great rejuvenation of the Chinese nation. We must be good at turning crises into opportunities, turning danger into safety, closely following the new connotations of important strategic opportunities, accelerating the optimization and upgrading of the economic structure, enhancing technological innovation capabilities, deepening reform and opening up, accelerating green development, participating in the reform of the global economic governance system, and turning pressure into the driving force for accelerating the high-quality development of the economy. This has undoubtedly become the main keynote and melody of this year's economic work.

Regarding the judgment of the economic situation, the central government proposed that we should see that the economic operation is stable with changes, changes with worries, the external environment is complex and severe, and the economy is facing downward pressure. Gao Yong, Party Secretary and Secretary-General of the China National Textile and Apparel Council believes that, judging from the current economic data, the economy will still be in an adjustment period this year. Under the new normal of the economy, it will continue to maintain an L-shaped trend. As the most fully marketized industry, the textile industry entered the adjustment period first and maintained medium-low speed development, which is also in line with economic laws.

This Central Economic Work Conference regards promoting high-quality development of manufacturing as the first key task this year. In Gao Yong's view, this also shows the country's concern about the trend of China's economy shifting from the real to the virtual in recent years, re-emphasizing the real economy, and reflecting the firm determination to build a strong manufacturing country.

In terms of policies, it is required to implement good proactive fiscal policies and prudent monetary policies, implement employment-first policies, promote larger-scale tax cuts and more significant fee reductions, and effectively alleviate the problems of financing difficulties and high financing costs for enterprises. Gao Yong believes that these statements will bring substantial benefits to economic development this year.

“Focusing on stimulating the vitality of micro-subjects” is the key point of the central government's promotion of high-quality development of manufacturing. Gao Yong explained that, in fact, micro-subjects represent enterprises in the real economy. The meeting mentioned “the vitality of micro-subjects” three times, conveying the new trend of China's future development, providing a “good prescription” for breaking down obstacles to the development of the private economy, and enhancing the endogenous driving force for the development of small and micro-enterprises.

Enterprises are the most basic and important subjects of market supply. Only by stimulating the vitality of enterprises and improving their efficiency can the micro-foundation of high-quality development be activated. This also shows that the state attaches great importance to the temporary difficulties currently faced by small and micro-enterprises, and will make great efforts to adopt precise and effective measures to support the development of small and micro-enterprises, and take practical measures to further implement policy measures to support the development of small and micro-enterprises in terms of reducing tax and fee burdens, solving financing problems, improving environmental governance, and improving technological innovation capabilities.

China's door to opening up to the outside world will never be closed, but will only open wider.

At present, China's process of opening up to the outside world is gaining new momentum, and the textile industry is also accelerating the global allocation of resources in the process of opening up, and has obtained unprecedented development opportunities.

In recent years, China has closely integrated the Belt and Road Initiative with reform and opening up, promoting reform and development through opening up, and deepening the comprehensive pattern of opening up to the outside world. In this process, China's textile industry has played the role of a pioneer, actively exploring the way to “go global”.

Sun Ruizhe, President of the China National Textile and Apparel Council said that at present, the textile industry is relatively sufficient in terms of “going global”, especially with the launch of the Belt and Road Initiative, Chinese textile enterprises have invested in South Asia, West Asia, Central Asia and Africa, including Vietnam, Ethiopia, Egypt, Kenya, Nigeria and other countries, actively “going global” in terms of production capacity.

On December 15, 2018, the Vietnam Huafu Industrial Park opened. It is understood that in the past four years, Vietnam Huafu has invested a total of US$300 million, building 280,000 spindles, 20,000 tons of color fiber dyeing, a 2,000-square-meter R&D center, and supporting production and living facilities of 110,000 square meters. It has become Huafu's rapid response base in Southeast Asia, providing employment for more than 3,200 people.

There are many textile enterprises that, like Huafu, expand their strategic new space and make full use of both international and domestic markets and resources. It is reported that at present, textile enterprises' foreign investment continues to increase, and manufacturing layout and resource allocation are proceeding in parallel. By the end of 2017, the stock of China's textile industry's foreign direct investment exceeded US$10 billion, with more than 1,000 overseas investment production enterprises, annual sales revenue exceeding US$10 billion, and nearly 200,000 employees. Asia is the largest concentrated area of China's textile industry's foreign direct investment stock, and Africa is a new hotspot area for China's textile industry's foreign investment at present. In particular, in recent years, textile enterprises have also seized the opportunities of economic globalization of the Belt and Road Initiative and domestic consumption upgrading, making precise efforts, creating transnational supply chains, expanding brands, technologies, and market channels outward, and achieving value enhancement in the global industrial chain. This has become an important trend of industrial transfer in recent years.

In 2018, faced with a complex domestic and international situation, especially the severe challenge of Sino-US trade friction, China's textile industry steadily advanced amidst numerous risks and uncertainties in the development environment, maintaining a healthy development trend. In the short term, the Sino-US trade friction increased the uncertainty of textile and apparel exports to the US, but in the long run, it will accelerate our global layout and high-quality development. The Belt and Road Initiative has added new impetus and opportunities for the development of cooperation between the Chinese textile industry and Asian and African countries, expanding new development space and promoting cooperation to enter a new stage of deep integration and mutual promotion.

Over the past year, a series of "going global" actions by the Chinese textile industry have been carried out with unprecedented speed and efficiency. Delegations of Chinese textile and apparel entrepreneurs have visited more than 20 countries and regions, including Ethiopia, Egypt, Italy, the United States, Israel, Jordan, South Africa, Vietnam, Malaysia, Uzbekistan, Pakistan, and Kazakhstan.

From a global perspective, a prosperous world benefits China, and a prosperous China benefits the world.

On December 22, 2018, a major piece of news spread throughout the industry: The first domestically produced single-line production line with an annual output of 30,000 tons of Lyocell fiber was successfully put into operation, running smoothly and meeting product quality requirements. This industrialization project uses the Lyocell fiber industrialization complete set of technologies independently researched and developed by China National Textile and Apparel Council Co., Ltd., which has independent intellectual property rights. It is the first single-line 30,000-ton production line in China with completely independently designed and manufactured technology and complete equipment. It is the continuation of the 18 years of research and development by CNTC, from small-scale tests and pilot tests to the industrialization of 10,000-ton-level production. This industrialization complete set of technologies also won the first prize of the 2018 China Textile Industry Federation Science and Technology Award, "Textile Light". The success of this project is a major breakthrough in the domestic production of fibers in China, and this technological innovation is also a gift presented by the textile industry to the 40th anniversary of reform and opening up.

Li Ling Shen, Vice President of China Textile Industry Federation and President of China Industrial Textile Industry Association Said that a number of projects, such as the industrialization of Lyocell fiber and the two-component spun-bonded hydro-entangled non-woven materials, are based on independent innovation and have completely independent intellectual property rights. They have broken foreign technology monopolies, and the overall technology has reached the international advanced level. Using original technology as a fulcrum, these projects have improved the overall technological level and core competitiveness of China's textile industry.

In the past year, the textile industry has embarked on the fast track of high-quality development. To continuously meet the people's ever-growing needs for a better life, promoting intelligent manufacturing is undoubtedly a crucial material foundation. Intelligent manufacturing is not only an important part of building a strong textile country but also an important path to promote the textile industry to become an innovation-driven technological industry. Many projects that have won the first prize of "Textile Light" Science and Technology Award in recent years have demonstrated the characteristics of intelligent manufacturing. Textile intelligent manufacturing projects, such as the high-quality and high-efficiency ring spinning advanced technology developed by Anhui Huamo Textile Co., Ltd. and other units, and the intelligent key technology for denim washing developed by Zhongshan Yida Garment Co., Ltd. and other units, have effectively promoted the transformation and upgrading of textile manufacturing to digitalization, networking, and intelligence through the deep integration of advanced technologies such as the Internet, big data, and artificial intelligence, providing an advanced manufacturing foundation for the high-quality development of the textile industry.

In the new year, the focus of technological innovation will mainly be on new fiber materials technology, green manufacturing technology, high-performance industrial textile technology, advanced textile equipment technology, and textile intelligent manufacturing technology.

In mid-2018, under the influence of various factors such as fluctuations in crude oil prices, exchange rate changes, futures speculation, and changes in supply and demand relationships, the polyester market experienced a round of sharp rises and falls. By the end of the year, polyester chain products had fallen below the previous upward starting point.

Duan Xiaoping, Vice President of China Textile Industry Federation and President of China Chemical Fiber Industry Association Analyzed that the sharp drop is merely a market reaction after excessive surges, and the polyester market does not have the conditions for a continued significant decline. In the past two years, due to good profits, there has been some irrational fixed-asset investment in the chemical fiber industry, leading to the concentrated release of new production capacity, putting some pressure on the market. However, due to the equipment manufacturers' control over supply capacity, these production capacities have been steadily released, and the impact on the market is basically within the digestible range. Although a certain amount of production capacity is still planned to be put into production in 2019, due to the decline in the industry's prosperity, some units may postpone their commissioning. Duan Xiaoping reminded enterprises that although the market has basically bottomed out and is expected to improve or rebound in the future, they should remain rational and not participate in futures speculation.

In recent years, the process of leading chemical fiber companies developing integrated refining and chemical industries has accelerated, especially in 2018, with significant achievements. Hengyi Group actively responded to the Belt and Road Initiative and cooperated with the Brunei government to build the Hengyi Brunei Pulau Muara Besar (PMB) petrochemical project; Hengli's 20 million-ton/year integrated refining and chemical project was officially put into operation in Dalian Changxingdao... Enterprises have moved upstream of the industrial chain through integrated refining and chemical projects, creating a full industrial chain layout from crude oil to textiles to ensure stable raw material supply, improve industrial chain supporting facilities, and enhance risk resistance. The commissioning of these large-scale refining and chemical production capacities, mainly led by private enterprises, not only brings advantages to the enterprises themselves but also builds new competitive advantages for the entire chemical fiber and textile industry. Based on the existing complete textile industry chain supporting advantages, diverse climate conditions advantages, and significant labor reduction brought about by intelligent manufacturing, it also provides the industry with more, better, and cheaper chemical fiber raw materials. These competitive advantages will allow the chemical fiber industry to continue to develop steadily.

Since 2018, domestic cotton prices have fluctuated with market supply and demand changes, but the price difference between domestic and foreign cotton has generally remained within a reasonable range. As the new cotton year of 2018/2019 is about to begin, by the end of this round of reserve release, the national reserve inventory is estimated to decrease to about 2 million tons. Considering the need to maintain normal inventory, the role of national reserve cotton in increasing the total market supply in the new year will decrease. After nearly two years of adjustment, the textile industry's cotton consumption has increased, and it is expected that there will be a cotton supply gap of about 3 million tons in China in 2019. Yang Jichao, Vice President of China Textile Industry Federation and President of China Knitting Industry Association Pointed out that under the condition of increasing supply and demand gap, the reasonable arrangement of cotton management policies is crucial for the textile industry to maintain stable operation. In the future, the textile industry still needs to pay close attention to the arrangement of the total amount of cotton import quotas and adjustments to the issuance methods.

In addition, in 2018, the continuous escalation of Sino-US trade friction once made cotton-using enterprises worried. On December 24, 2018, the Ministry of Finance issued the "2019 Adjustment Plan for Provisional Import and Export Tariffs," stipulating that the sliding scale tariff on cotton should be appropriately reduced from January 1, 2019. While adjusting the sliding scale tariff will reduce import costs to a certain extent, the future trend of cotton prices remains unknown, and enterprises need to closely monitor the market supply and demand situation.

In 2019, it was uncertain whether we would encounter any "black swan" or "grey rhino" events. However, we must firmly believe that China's development is still in, and will remain for a long time, an important strategic period of opportunity. Amidst global changes, risks and opportunities coexist, and the general trend of stable development in the raw materials industry will not fundamentally change. Enterprises should be good at seizing new opportunities, linking the upstream and downstream of the industry, deepening supply-side structural reforms, implementing the "three products" strategy, and turning pressure into momentum to accelerate the high-quality development of the industry.

Looking back at 2018, a common understanding in the textile and apparel industry is that intelligence has become an irreversible trend in improving the labor productivity and flexible manufacturing level of the supply system and meeting consumer needs. High-end automated and intelligent equipment has made the textile and apparel industry a member of the high-tech industry, providing a more effective solution for attracting high-tech talents and solving bottlenecks such as recruitment difficulties.

Intelligent manufacturing will become the main direction of China's manufacturing. It is worth affirming that in 2018, China's textile and apparel industry has achieved gratifying results in intelligent manufacturing.

In 2018, Huafang Group, through the creation of a smart factory, further optimized enterprise management and successfully created the Da Zhihui system HFCPS. This system effectively integrates consumer and business information with manufacturing information interconnection, fully integrating information flow and logistics. Now, through the establishment and implementation of smart factories, Huafang's operating costs have been reduced by 10% to 30%. Next, Huafang will also establish a future consumer customization platform and an enterprise full-process business collaboration management platform.

As an advocate and practitioner of intelligent and digital textiles, in 2018, Lutai Textile also focused on using automated and digital equipment to achieve human liberation, improve labor efficiency, ultimately meet customer's personalized needs, and truly achieve "people-oriented".

As a provider of intelligent solutions, Lectra has made significant achievements in assisting Chinese enterprises in achieving automation and intelligence in recent years. It has proposed numerous intelligent solutions to address enterprise requirements such as reducing pre-production technical preparation, improving production efficiency, reducing costs, and controlling risks.

Clothing companies are also constantly exploring the path of intelligence. At CHIC2018 Spring Exhibition, Hongdou launched many "black technologies," such as unmanned retail stores, smart fitting rooms, magic dressing mirrors, and also showcased new technologies such as cloud shelves and data screens, bringing users a fresher shopping experience.

In response to the development trend of intelligent manufacturing in China's textile and apparel industry, in June 2018, the China National Textile and Apparel Council held the first "China Textile Industry Intelligent Manufacturing Conference." The conference once again emphasized that carrying out intelligent manufacturing is an important path to promote the transformation and upgrading of the textile industry and must be regarded as a very important task in the current and future period. The exchange of views and technological exploration of intelligent manufacturing within the textile industry continues.

As early as 2016, with the support and promotion of the Ministry of Industry and Information Technology, the China Apparel Association, together with relevant industry associations, scientific research institutions, and leading enterprises, established the "China Apparel Intelligent Manufacturing Technology Innovation Strategic Alliance." For several years, the alliance has been committed to promoting and improving intelligent manufacturing in China's apparel industry.

In fact, intelligent technology is transforming the traditional textile industry, and many companies are trying to implement intelligent manufacturing in some manufacturing processes. Although some companies have not replaced equipment on a large scale, they have significantly improved product quality and production efficiency through equipment upgrades in key areas.

It is foreseeable that the industry will continue to focus on intelligent manufacturing in 2019, Sun Ruizhe, President of the China National Textile and Apparel Council pointing out that intelligent manufacturing in the textile and apparel industry should focus on the development of intelligent equipment, intelligent operations, and intelligent products.