U.S. Hails Textile Trade Pact With China

President Clinton’s top trade negotiator said Sunday that a newly signed textile pact with China laid the basis for expanded bilateral textile trade.

“This is a solid agreement that meets our critical objectives,” U.S. Trade Representative-designate Charlene Barshefsky said in a statement.

China and the U.S. signed the agreement in Beijing earlier in the day in an eleventh-hour deal that ended the threat of a transpacific trade war and was hailed by both sides as a breakthrough.

Gaining assured access for the first time to Chinese textile markets was the main achievement, U.S. officials said, adding that the pact also granted China a U.S. import quota slightly larger than the previous 1994 textile pact.

“We have our first textiles market access agreement with China and we have strengthened enforcement terms against illegal trans-shipments,” Barshefsky said. “This agreement provides a solid basis for us to strengthen our textile trade relationship with China.”

China, under the market access agreement, has agreed to cut tariffs and “bind” tariffs at applied rates in a deal that Barshefsky said will boost market access for U.S. exporters.

China also has agreed to ensure that nontariff barriers do not impede the achievement of improved access, she said. The agreement provides for review of China’s implementation of its commitments, the U.S. statement added.

Millions of dollars in penalties slapped by Washington on Chinese imports remained in force under the deal, although Beijing agreed to withdraw its threat of retaliation, top U.S. textile negotiator Rita Hayes said after the signing.

“For the first time the United States has market access with China . . . and this is something we felt very strongly about,” Hayes told reporters.

The four-year textile accord was signed by Hayes and Li Dongsheng, China’s chief negotiator and director of the trade management department of the Ministry of Foreign Trade and Economic Cooperation.

The deal was reached during a one-day extension to the final deadline for renewal of the Sino-U.S. accord, which had originally been scheduled to expire on Dec. 31 but was extended by a month to allow time to reach a compromise.

“I think this morning at the beginning we were unhappy with each other, but now we have become friends,” U.S. negotiator Li told Hayes during the signing of the accord.

The accord ended the threat of a Sino-U.S. trade war, which had loomed after Washington slapped $19 million in penalties on Chinese imports in September, accusing Beijing of shipping textiles through third countries to evade quota restrictions.

China had threatened to retaliate by temporarily banning imports of some U.S. textiles, farm goods and alcoholic drinks but delayed the action to allow time for further talks.

After the signing of the textile accord, Beijing announced it was calling off its retaliatory measures, but U.S. negotiator Hayes said Washington’s penalties remained in force.