However, he assured that China would not dominate textile market in 2005 stating, "If China wants to move higher, it will naturally give up the low end to other countries such as Pakistan, Vietnam and Bangladesh.
In an interview here, he referred to a report by the US International Trade Commission (ITC) which said China was expected to become the "supplier of choice" for most the US textile and apparel importers after 2005.
The report said the US importers should expand the trade relationships with other low-cost countries, such as Pakistan, Bangladesh and India to reduce the risk of sourcing from only one country.
Meanwhile a senior official of the China Chamber of Commerce of Import and Export for Textiles, Gao Xinyu said China would not rise to monopolise the global textile market by 2005 even if quotas curbing the free flow of textiles and apparel were lifted.
He said it would be impossible for China to dominate the market in 2005 as many had forecasted. Under the Agreement on Textiles and Clothing (ATC), all quotas restricting textile and clothing trade between World Trade Organisation (WTO) members will be eliminated by December 31.
Some foreign counterparts predicted that Chinese textile goods, supported by cheap labour costs, would swamp the world market and force them out of the market. "This prediction is sensational. China is a major player but will not sweep the world," Cao said.
According to a China Daily's report, a growing number of China's textile manufacturers, facing the January 1 elimination of quotas, were moving portions of their businesses overseas.
"By moving our marketing centre to New York, we will be able to rapidly increase our presence in the US," said an official with Shandong-based Lot tex Industries Ltd.
Analysing the post-quota situation, he however said, other challenges including escalating competition, import restrictions, technical barriers and market fluctuations will remain.
The official said fear of the expected intense competition in the post-quota era was one reason that Chinese textile manufacturers were moving overseas.
Millions of small and medium-sized Chinese textile manufacturers were expected to increase their exports after quotas were eliminated, he said adding that would drive down prices.