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EU to China: cut textile exports or face curbs
Sun Apr 24, 2005 8:49 PM BST
By John Chalmers
BRUSSELS (Reuters) - The EU urged China on Sunday to cut its textile exports or face formal curbs on products such as T-shirts and trousers, which have leapt in some cases by more than 500 percent since the end of a global quota system.
"Europe cannot stand by and simply watch these developments unfold. The time has come to take further action," EU Trade Commissioner Peter Mandelson said, announcing plans for a probe into nine categories of Chinese textile and clothing products.
His decision to recommend to the EU executive Commission an investigation into the surge which followed the January 1 winding up of a global quota regime could lead to formal curbs on Chinese shipments by the European Union within 150 days.
But major textile producers including France, Portugal and Italy said his initiative was not enough and they would push for the probe to be expanded to as many as 20 product categories.
Under the terms of its entry into the World Trade Organisation (WTO) in 2001, Beijing agreed that members could cap imports of Chinese clothing and textiles at 7.5 percent above the level of shipments the previous year until 2008 -- provided they demonstrate that their own firms are suffering.
China made 17 percent of the world's textiles and clothing in 2003, but the WTO sees its market share rising to above 50 percent within the coming three years.
Mandelson said he wanted an investigation into sharp rises in imports from China of T-shirts, pullovers, men's trousers, blouses, stockings and socks, women's overcoats, brassieres, flax or ramie yarn and woven fabrics.
Yet some felt the probe was not enough.
"We should be going faster than this," French Trade Minister Francois Loos told reporters after he and officials from Portugal and Italy met Mandelson in Luxembourg before a ministerial session there including all 25 EU countries.
Portuguese Economy Minister Manuel Pinho said a group of around a dozen EU textile-producing nations had identified 20 categories of products to be included in the investigation, which should be completed as soon as possible.
"There is a chance it might take more than nine months, and given the urgency of the situation we should like a fast-track procedure," which could take less than three months, he said after meeting Mandelson.
BAD FOR FIRMS, GOOD FOR CONSUMERS?
Others say that consumers would win if greater competition from abroad led to cheaper clothes and suggest any move towards curbs would smack of protectionism.
"The textile industry has had 10 years to prepare for the lifting of the quota. We don't see any reason to introduce limits now," said Swedish State Secretary for Trade Lars-Olof Lindgren, urging EU textile firms to be more competitive.
European Commission data showed the bloc's member states imported 95.7 million T-shirts in the first three months of this year, a rise of 164 percent from the same 2004 period, while pullover and men's trouser imports jumped 534 and 413 percent respectively.
Beijing imposed export tariffs on some textile products from January 1 to counter fears that its exports would flood world markets and undermine producers in both poor and rich nations.
But Mandelson said China should take further steps to avoid the imposition of so-called "safeguards" on its exports.
"I urge China to take a fresh look at the measures they have put in place already and explore whether they cannot do more. I have also asked for concrete evidence that their measures are having an effect," he said.
Alarm at the prospect of massive job losses in the EU textiles sector has crept into France's public debate on the EU constitution ahead of a crucial referendum next month.
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Print this article Close This Window
EU to China: cut textile exports or face curbs
Sun Apr 24, 2005 8:49 PM BST
By John Chalmers
BRUSSELS (Reuters) - The EU urged China on Sunday to cut its textile exports or face formal curbs on products such as T-shirts and trousers, which have leapt in some cases by more than 500 percent since the end of a global quota system.
"Europe cannot stand by and simply watch these developments unfold. The time has come to take further action," EU Trade Commissioner Peter Mandelson said, announcing plans for a probe into nine categories of Chinese textile and clothing products.
His decision to recommend to the EU executive Commission an investigation into the surge which followed the January 1 winding up of a global quota regime could lead to formal curbs on Chinese shipments by the European Union within 150 days.
But major textile producers including France, Portugal and Italy said his initiative was not enough and they would push for the probe to be expanded to as many as 20 product categories.
Under the terms of its entry into the World Trade Organisation (WTO) in 2001, Beijing agreed that members could cap imports of Chinese clothing and textiles at 7.5 percent above the level of shipments the previous year until 2008 -- provided they demonstrate that their own firms are suffering.
China made 17 percent of the world's textiles and clothing in 2003, but the WTO sees its market share rising to above 50 percent within the coming three years.
Mandelson said he wanted an investigation into sharp rises in imports from China of T-shirts, pullovers, men's trousers, blouses, stockings and socks, women's overcoats, brassieres, flax or ramie yarn and woven fabrics.
Yet some felt the probe was not enough.
"We should be going faster than this," French Trade Minister Francois Loos told reporters after he and officials from Portugal and Italy met Mandelson in Luxembourg before a ministerial session there including all 25 EU countries.
Portuguese Economy Minister Manuel Pinho said a group of around a dozen EU textile-producing nations had identified 20 categories of products to be included in the investigation, which should be completed as soon as possible.
"There is a chance it might take more than nine months, and given the urgency of the situation we should like a fast-track procedure," which could take less than three months, he said after meeting Mandelson.
BAD FOR FIRMS, GOOD FOR CONSUMERS?
Others say that consumers would win if greater competition from abroad led to cheaper clothes and suggest any move towards curbs would smack of protectionism.
"The textile industry has had 10 years to prepare for the lifting of the quota. We don't see any reason to introduce limits now," said Swedish State Secretary for Trade Lars-Olof Lindgren, urging EU textile firms to be more competitive.
European Commission data showed the bloc's member states imported 95.7 million T-shirts in the first three months of this year, a rise of 164 percent from the same 2004 period, while pullover and men's trouser imports jumped 534 and 413 percent respectively.
Beijing imposed export tariffs on some textile products from January 1 to counter fears that its exports would flood world markets and undermine producers in both poor and rich nations.
But Mandelson said China should take further steps to avoid the imposition of so-called "safeguards" on its exports.
"I urge China to take a fresh look at the measures they have put in place already and explore whether they cannot do more. I have also asked for concrete evidence that their measures are having an effect," he said.
Alarm at the prospect of massive job losses in the EU textiles sector has crept into France's public debate on the EU constitution ahead of a crucial referendum next month.
--------------------------------------------------------------------------------
© Reuters 2005. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters and the Reuters sphere logo are registered trademarks and trademarks of the Reuters group of companies around the world.
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posted by Eastlaw @ 3:55 AM
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