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US financier launches textile JV in China International Textile Group, the fabric giant run by US financier Wilbur Ross, and Hong Kong conglomerate Novel Group broke ground Wednesday on a US$95 million denim plant on the mainland that will sell to export-driven domestic firms. The launch of the joint venture came after US trade negotiators visited the country to try to defuse tension between China and the United States over China's textile exports, which have surged since a global quota system was abolished this year. But Ross, known as the king of bankruptcy after years of buying and restructuring failed or struggling companies, said he was keeping his eye on the future. "Our orientation is very, very long term. That's why we are going ahead with this project, even though there is a temporary issue of safeguards in the United States," said Ross during the plant's opening ceremony in Jiaxing, near Shanghai. From early 2007, Ross' and Novel's factory would churn out 28 million yards of denim a year, yielding about US$80 million in annual revenue, according to Kee Chung Chao, a Novel director. Ross's company would own 51 percent and Novel the remainder. The plant aimed to sell denim fabric to Chinese plants that export finished products, executives added. In June, Chinese and European negotiators agreed to cap growth of textile exports from China to between 8 and 12.5 percent. The United States has unilaterally imposed growth curbs of 7.5 percent on exports of selected Chinese textiles. |
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