1、AbstractThe share of Chinas textile industry in global textile market has kept expanding for more than 20 years by full utilization of its advantage in factor endowment since the Reform and Opening Policy. This paper argues that current competitive advantage of Chinas textile industry is still based
2、 on traditional factor comparative advantage, which may be weakened since the technology of international textile industry is upgrading continually and the international competition is more intensely than before. After Chinas entrance to WTO there are some difficulties such as indisposition of indus
3、try and trade structure, trade barriers to Chinese textile industry. How to accelerate industry structure upgrading and enhance international competitive advantage of Chinas textile industry is the primary issue for the development of Chinas textile industry.Textile industry has long been a pillar t
4、o Chinas economy thanks to its advantage in factor endowment and market scale. Trade volume of textile sector has increased by 27.11 times during the past 25 years （from the Reform and Opening）. In 2005, textile export took up 15.4% of Chinas total export and 24.4% of the worlds total export in text
5、ile, and the production and export of Chinese textile products are both the largest in the world.Nonetheless, Chinas textile industry is facing various difficulties, such as excessive resource reliance, low technology and value added, indisposition in trade structure and highly concentrated export m
6、arkets, etc. More and more trade sanctions against Chinas textile products are particularly noteworthy as they cast tight restrictions on Chinas competitive advantage in this industry. This paper aims at an in-depth investigation to competitive advantage of Chinas textile industry and brings corresp
7、onding suggestions.I.International Competitive advantage Of Chinas Textile IndustryIn view of the relation of factor and international competitive advantage, theMauricio Gigli， China Textile development of textile industry is still determined by labor cost and technology. In comparison, garment indu
8、stry is labor intensity, while in textile industry, particularly in the chemical fiber sector, capital and technology is becoming more and more important. Chinas textile industry shows apparent scale economy and cost effects in material supply, labor cost, product qualities, compatibility between up
9、 and down stream, which contribute to its vigorous export competitive advantage. But as developed countries are persistently investing new technologies into their textile industry, advantage of cheap labor in developing countries is tend to be weakened by continuously improving productivity in devel
10、oped countries. Textile industry in developed countries thus can maintain higher profit while at the same time reduce production. In this section, competitive advantage of Chinas textile industry will be analyzed, and comparisons to its counterparts in both developed and developing economies will be
11、 made.1 .Foundation of competitive advantage of Chinas textile industryThe competitive advantage of present Chinas textile industry is in a large part depends on its solid industrial foundation and cheap cost. In comparison with its overseas counterparts, Chinas textile industry shows competitive ad
12、vantage in the following aspects, which are expected to still exist in the near future.（1）Advantage in factor endowmentThe abundant supply of primary factors such as labor and related materials is essential to ChinaAmong them, the most important advantage is human capital. There are two main feature
13、s in Chinese labor resource, the first of which is its low price as well as superior quality. Average education period of Chinese workers is ten years, which is the medium level of developing countries and around four yearslag compared with those in developed economies, yet wage of Chinese worker is
14、 well below those of other countries. China has gained much economic benefits in textile industry without loss of the comparative advantage in labor supply, and such an advantage is a driving force for textile industrys further development.The second feature is its sustainability. Expansion of urban
15、ization and improving higher education in China will provide more and more superior but low price human resource for textile industry, so the rising human capital stock will guarantee the supply of worker and technological support for future development of China（2）Superiority in market scaleAlthough
16、 domestic market absorbs over 70% of aggregative textile output, consumption per capita in China is far below the worlds average. China is the largest and fastest growing developing country; whose vigorous economic development and improving living standard bring expanding demand both in quantity and quality for textile products. This ind
