According to a press release from the Chinese Ministry of Commerce, many textile producers in south China's Guangdong have been forced to cut jobs due to a lack of export orders in the year 2006.

This is said to be the result of export restrictions that came into force on January 1 limiting some categories of textile, and garment products were placed with new export to the European Union countries and America - markets which accounted for 34% of China's total textile exports in 2005.

The lack of export orders forced many textile producers, especially small and medium-sized companies to cut jobs ahead of China's important holiday of Spring Festival, which will fall on January 29.

According to the release, one garment factory in Foshan City, Guangdong, said that his company has let 300 workers go, about 30% of the workforce.

There are some 6,200 textile companies in Foshan. However, only 76 of them have won textile export quotas for this year.
The Sino-US textile agreement which took effect on January 1 imposes quotas on 21 types of clothing and textiles from China by 2008. Ten types of Chinese textile and apparel products exported to the European Union have also been put under quota restrictions.