EU gets tough on Chinese clothing exports
Trade talks stepped up as import curbs loom
The European Union could impose limits on imports of clothing from China in two weeks if trade talks fail to reach a compromise.
With retailers sourcing ever-larger quantities of clothing from Chinese producers since global quotas were ended at the start of this year, EU trade comissioners are concerned that the surge in Chinese textile exports will lead to business failures and job losses in EU member states.
The EU has now started a 15-day timetable which would see Chinese textile imports curbed unless an agreement can be reached with Beijing. Talks will start this week, with EU comissioners aiming to persuade China to put export limits on clothing, as well as flax yarn, widely used in the manufacture of t-shirts and other clothing.
The UK appointed EU trade commissioner Peter Mandelson spoke to Chinese commerce minister Bo Xilai on Friday before starting the formal consultation process. The US has also asked the Chinese government for formal talks. It wants to restrict imports of a range of clothes and textiles.
China agreed that other countries could impose temporary limits on textile exports if they disrupted local markets as a condition of its entry into the World Trade Organization. It has now agreed tariffs on 74 clothing and textile products, but has ruled out further concessions.
In the first quarter on the year, EU figures show imports of Chinese t-shirts up 187 per cent and of flax yarn up 56 per cent year-on-year. At the same time, the EU says there has been “a dramatic deterioration of production, profitability and employment” among manufacturers in these categories in Europe.
Bo Xilai of China, meeting a Spanish trade delegation this weekend, said the rise in exports is a “short-term phenomenon” following the end of the quota system. He quoted figures showing that Chinese exports of clothing have started to decline since March.
The British Retail Consortium has opposed any quotas. BRC director general Kevin Hawkins, head of the British Retail Consortium, said last week: “We have made our position on free trade very clear: we absolutely want Chinese products. We want to go on providing our customers with competitive products.”
