Research firm Analysys says that China's RFID market maintained a moderate growth of 8.62% in the fourth quarter of 2005, and the manufacturing sector should be the entry field for RFID in China.

According to the firm's report, sales in China's RFID market increased from CNY568 million in Q3 to CNY617 million in Q4 in 2005, with a growth rate of 8.62%.

Analysys International thinks the growth is moderate, and found RFID market growth in Q4 2005 concentrated on the replacement of 2G ID card, applications on public transportation and expressway systems.

"China is a big manufacturing country. There are huge stock and logistics systems in manufacturing processes. RFID applications can help firms to obtain accurate logistics information and achieve differentiated production, so as to reduce costs and increase efficiency," says Zhao Yazhou, an analyst from Analysys International.

However, Analysys International says there are some restrictions on China's RFID applications in the manufacturing industry. Cost and standard are the major factors limiting China's RFID development.