To more effectively tackle worldwide competition China's paper making industry set-up its own chamber of commerce on July 6, the China Business News has reported.

The chamber, under the All-China Federation of Industry and Commerce, was initiated by 157 companies from more than 20 provinces, municipalities and autonomous regions. Their businesses range from paper making, packaging, printing to media and trading. 

Cao Zhenlei, director of the China Research Institute for Paper Making and Paper Pulp told the Shanghai-based newspaper the move reflected "the enterprises' desire to secure their long-term interests."

He said to ward off dumping by foreign rivals domestic paper-making companies had to team up to become more influential in the global market.

Although China's demand for paper products has been growing at around 7 percent in recent years, 4 percent higher than the world average, the country's paper-making industry is facing major difficulties. 

Chinese data has revealed that the sector achieved 11.9 percent growth in profits in the first quarter this year which is 14 percent lower than the same period of 2005. Companies who've lost out found their aggregated losses up 67.34 percent year-on-year.

Industry experts have said that because of market demand much capital had flowed into the sector and this had caused wasteful duplications in the manufacture of low end products. As a result, the industry was being propped up by small and geographically scattered paper mills which only produced 6,000 types of low-end products.

The Shanghai-based newspaper noted the new body would facilitate communication within the industry, help companies avoid poor investments and make the sector's product structure more scientific and rational.

(Xinhua News Agency July 10, 2006)