Kingdom Holdings leads new Chinese-Portuguese textile partnership

Kingdom Holdings, the Hong Kong-listed textile giant, is making significant moves in Europe. The company has announced a landmark Chinese-Portuguese textile partnership alongside four local firms to establish Portugal’s first industrial wet-spinning plant dedicated to flax and hemp yarn.

Situated in the former Filatex building in Rebordões, Santo Tirso – roughly 25 kilometres from Porto – the project involves a capital investment of approximately €30 million. The facility, named Nafilux by Nau Verde, occupies some 15,000 square metres of covered space and is expected to create roughly 250 direct jobs for the region, according to multiple media reports.

Expanding the Chinese-Portuguese textile partnership

This Chinese-Portuguese textile partnership represents a vital step in rebuilding the European textile value chain. Historically, while Europe remains one of the world’s major producers of raw flax fibre, it has relied heavily on Asian processing capacity. In recent years, raw materials were frequently shipped to Asia for the specialised wet-spinning process before returning to Europe as yarn for use in apparel and fabrics. By establishing local capabilities, this project seeks to reduce dependence on external processing and foster higher value-added production within Portugal.

Kingdom Holdings, which was founded in 1978 and is headquartered in Jiaxing, Zhejiang province, has joined forces with four highly experienced Portuguese textile companies: Calvelex, Mundifios, Paulo de Oliveira, and Riopele. Together, they are creating industrial capacity that has been notably lacking in Portugal and much of Europe.

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For Kingdom Holdings, which is a world leader in the production of linen and hemp yarn, this venture provides a strategic foothold in the European market. As global supply chains undergo rapid evolution, this Chinese-Portuguese textile partnership arrives at a critical juncture where nearshoring, traceability, and sustainability are increasingly prioritised by manufacturers and brands alike.

The plant stands as one of the few facilities in Europe currently dedicated to producing 100 percent premium linen yarn, while also incorporating hemp as an increasingly important natural fibre. As this Chinese-Portuguese textile partnership progresses, it marks a significant shift toward a more integrated, localised production model for the global textile industry.