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EU not to impose quota on Chinese textiles
By Dai Yan (China Daily)
Updated: 2005-02-07 02:00

The European Union has assured China's textile firms that it will not follow Turkey's lead by imposing quotas on textile imports from the nation.

EU Trade Commissioner Peter Mandelson's spokeswoman Claude Veron-Reville said such safeguards would only be used as a last resort.

Such "measures would have to be fully justified," Veron-Reville told China Daily.

Turkey decided in December to impose quotas on 42 categories of Chinese textile imports, just ahead of the lifting of global quotas on January 1.

China's textile industry grew increasingly concerned that the EU may take such measures in the light of the call from Euratex - Europe's largest textile-industry lobby group - for action against China.

Reports have also indicated that, at a closed-door meeting last month, EU trade officials and politicians discussed whether Turkey's action against China should lead the EU to do likewise.

The spokeswoman said the EU is currently working on guidelines for safeguards.

"We want to get them right, not rushed."

However, she stated "the EU strategy for the textile and clothing sector is not a protectionist one but it is a forward-looking one and focuses on our strength."

She added the European industry has adapted over the 10-year transition period for quota removal and specialized in what it does best: high-tech fabrics. By exporting such products, Europe has moved up the value chain.

The World Trade Organization (WTO) Agreement on Textiles and Clothing (ATC), which established a 10-year period for the elimination of the quotas, expired on 31 December 2004. From January 1, 2005, trade in textile and clothing products cannot be subject to any quantitative restrictions.

Just ahead of the removal of the quotas, the European Commission proposed seven measures to enhance the competitiveness of the European textiles industry.

These are boosting research and innovation, ensuring lifelong education and vocational training, structural funds to cover unforeseen crises, strengthening the fight against counterfeiting and piracy, improving access to other markets, rapidly completing the Euro-Mediterranean zone and strengthening co-operation with China.

Co-operation with China includes the recently established EU-China textiles dialogue and the monitoring of Chinese imports.

There is no going back on the removal of the quotas. The EU will respect its commitment and the quota's removal is the price for China's accession to the WTO, Veron-Reville said.

"But we want to ensure a smooth transition to a quota-free regime, in particular for vulnerable countries whose economies are highly dependent on exports," she said.

The spokeswoman pointed to Bangladesh, whose textiles and cloth represent 85 per cent of its exports, as an example.

In fact, China has also agreed to take measures to ensure a smooth transition.

China announced eight measures last month, including imposing an export tax on textiles and cloth.

Mandelson has said that by accepting dialogue rather than confrontation, the commission has a greater chance of ensuring China does not become a threat to the European industry.

China and EU held two meetings of the Textiles Trade Dialogue in May and November last year.

Before the quota removal, EU textiles imports subject to quotas represented only 20 per cent of total EU textile and clothing products. And just 12 per cent of Chinese textile product exports to the EU were affected by the abolished quotas.

China is the European Union's leading textile supplier, accounting for 17.5 per cent of all textile imports in 2003.

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