Global Economics

EU Drops Chinese Textile Import Quotas


Restrictions on clothing imports give way to a joint monitoring system with Beijing over most garments arriving from China

The European Union is due at the end of 2007 to switch from import restrictions on Chinese clothes to a joint monitoring system with Beijing over most types of garments arriving to the European market, with some fearing a repeat flood of cheap Chinese clothes on European shop shelves.

The new monitoring mechanism will cover eight of the ten types of clothing categories that previously fell under the import quotas which the EU introduced in 2005 to limit the inflow of cheaper Chinese products.

At the time, the dispute between the two sides was dubbed the 'bra wars' after millions of bras, trousers and t-shirts were banned from entering the EU.

The new deal includes measures such as export licenses given out by Chinese officials to their domestic producers and stronger surveillance in Europe.

According to the AFP news agency, some European producers agree that such a move will make it easier to keep track of Chinese imports with EU trade commissioner Peter Mandelson promising to take further action if necessary.

"In the face of a sudden surge of Chinese textiles, the commission stands ready to use all the instruments at its disposal, should the situation so require," he told the European Parliament earlier this month.

However, he insisted that Brussels will not agree to any sort of extension of the 2005 quota arrangement, suggesting that it was a "once-and-for-all deal."

He added that while an increase in imports could be expected, any action to curb them "will be based on existing requirements and criteria."

"We do rely on the co-responsibility of China for this smooth transition. China is well aware that it is not in its interests to repeat what happened in 2005," said the British commissioner.

The EU put in place the temporary limits on specific clothing categories after a massive rise in Chinese imports following the expiration of international textile quotas in January 2005.

The decision came under pressure from European producers and member states with strong textile industries, such as France, Spain and Italy. But it was opposed by pro-liberal countries with powerful retail sectors, such as the Scandinavian countries and the UK.

But commissioner Mandelson told MEPs that he views "the textiles problems as emblematic of the broader problems we face in China."

"We expect the same sort of equal opportunity and fair treatment in China's market that Chinese producers receive in ours," he added.

In 2006, EU ran a trade deficit of €128 billion with China, with officials predicting the figure will shoot up to €170 billion by the end of this year.

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