Garment manufacturer Elba Holdings Bhd, which is based in Penang, Malaysia, is aiming to expand to China by 2006 and start retailing in the country's upscale market sector.

The company's deputy managing director, Leong Choong Chee, said that Elba had already been asked to sell its lines in several department stores in cities such as Beijing and Shanghai.

Elba is also considering switching production from its current Malaysian base to China to capitalise on its low costs and be closer to raw material sources.

According to Leong, Elba has the choice of setting up a joint venture with a Chinese firm or choosing to spilt its operations between Malaysia and China.