China's paper-making industry has established its own chamber of commerce to more effectively deal with global competition, the China Business News 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 that the move reflected "the enterprises' desire to secure long-term interests."

He said that to ward off dumping by foreign rivals, domestic paper-making companies must team up to become more influential in the world market.

Although China's demand for paper products has been growing at around 7 percent these years, 4 percentage points higher than the world average of 3 percent, the country's paper-making industry faces a severe situation.

Chinese data revealed that the sector scored 11.9 percent growth in its profits in the first quarter this year, 14 percentage points lower than a year earlier, and losing companies found their aggregated losses up 67.34 percent year-on-year.

Industry experts said that much capital lured by the market demand had flowed into the sector and caused wasteful duplicates at low level. As a result, the industry propped up mainly by small and scattered paper mills could only produce 6,000 kinds of low-end products.

The Shanghai-based newspaper noted that the agency would facilitate the exchange and communication within the industry and help companies to avoid blind investment and make the sector's product structure more scientific and rational.

(Xinhua News Agency July 10, 2006)