Statistics show that the province now has more than 2,200 industry guilds, which have gradually taken over the part of business management functions formerly exercised by the government.

For many companies, joining an association has become the natural choice after experiencing fierce market competition.

Changyi city in the province is famous for its cloth printing industry which represents about one third of the domestic market. However, competition some years ago saw companies snatching clients from each other, with price wars almost bringing down the entire sector.

In early 2000, more than 10 printing companies in the city jointly set up a business guild, and drew up standards, rules and set minimum prices. This quickly injected vitality into the industry, said guild secretary general Wang Yichen.

This year, the guild has decided to increase production lines and all members would be summoned together to jointly discuss such issues as what kind of equipment should be introduced and where. Otherwise unplanned development would result in another vicious cycle of price wars, Wang said.

Members of an aquatic breeding guild in Rizhao city have had similar experiences. They now agree that without the guild none would be profitable and the entire industry would suffer.

Though guilds face some difficulties, experts here believe they will play a bigger role in China under the market economy environment.

(Xinhua News Agency March 24, 2003)