China and the United States reached agreement today on extending a deal on textiles, averting a multibillion dollar trade war, an official with China’s Ministry of Foreign Trade and Economic Cooperation said.
The eleventh-hour agreement followed all-night talks between U.S. negotiator Rita Hayes and a team of Chinese officials on renewal of a 1994 textile accord and resolution of a dispute over U.S. penalties on Chinese exports.
Hayes had said Saturday she was confident the last-ditch talks would succeed after extending by one day a Jan. 31 deadline for multimillion dollar penalties on China’s exports.
Washington slapped $19 million worth of penalties on imports of Chinese textiles in September, saying Beijing was shipping textiles through third countries to evade quota restrictions.
China threatened to retaliate by temporarily banning U.S. imports.