China and the US are close to a textile agreement that is
hoped?to stabilize the bilateral textile trade
situation.
Anonymous US officials were quoted by AP (Associated Press) as
saying that the two countries had agreed on certain issues at the
7th round of talks held last week in Washington.
They said the deal, similar to the one between China and the EU
signed in June, would govern China's textile exports to the US over
the next three years. It is likely to allow exports to increase by
8 to 17 percent annually. Confirmation of this is expected
today.
"China has made concessions on the duration of the limits while
the US has made concessions on the growth rate," Sun Huaibin,
spokesperson for the China National Textile and Apparel Council (CNTAC),
said.
He said an agreement, which would give textile dealers a clear
trading environment, was much better than current safeguard
measures the US has adopted.
Under the safeguard measures, only a 7.5 percent increase in
China's textile and garment exports to the US is allowed
annually.
Meanwhile, Sun said that there were still two major problems
facing the Chinese textile industry.
The agreement is expected to take effect from the beginning of
next year, so China must be cautious about how to deal with exports
until then.
Millions of Chinese textile products piled up at European ports
earlier this year, as companies rushed to export as much as
possible during the "vacuum period" before the agreement took
effect.
"Allocating quotas set by the US to domestic textile exporters
is also very difficult," he added.
The?Ministry of Commerce (MOFCOM), China's trade
watchdog, is adopting a bidding method for the distribution of some
EU quotas. Others will be allocated to enterprises based on last
year's shipment volumes.
However, the revealed information does not give any indication
of the base figure for calculation, Cao Xinyu, vice chair of China
Chamber of Commerce for Import and Export of Textiles (CCCT),
said.
"The lack of a base figure makes it difficult to valuate the
possible agreement because we won't be able to calculate the
specific quotas for the coming years," he said.
Under the possible agreement, China's textile exports to the US
could be calculated according to a 12-month trade volume, which is
regarded as a base figure, and the agreed growth rate of 8 to 17
percent per annum.
No formal comments are available from either the Chinese or US
government.
The US government implemented safeguard measures against
made-in-China socks late last year on the request of its domestic
manufacturers.
After the decade-long global textile quota regime was eliminated
in January this year, tension intensified between the two countries
because the US placed more curbs on Chinese textile products. The
US has so far imposed limits on nine categories of Chinese textile
products.
The Chinese textile industry said the frictions were a big blow
to them since their US customers declined to purchase products
under US restrictions and placed orders with some Southeast Asian
countries instead.
(China Daily November 8, 2005)