U.S., China Reach Deal on Textiles

The U.S. and China reached a tentative agreement Saturday to cap exports of Chinese clothing to the U.S. over the next three years, textile industry representatives for importers and producers said.

The agreement raises the allowable U.S. import growth rate for Chinese pants, knit shirts, bras and other items to 10% in 2006 and to about 16% by 2008, said the officials, who spoke on condition of anonymity.

In return, U.S. textile makers get a set standard of trade restrictions they say is needed to protect them from the low- priced Chinese clothing that has flooded the U.S. market. The U.S. had been imposing caps on a case-by-case basis by examining individual complaints by companies -- a time-consuming process that must be redone yearly under global trade rules.

This year, the U.S. has imposed an annual growth limit of 7.5% on $3.4 billion worth of Chinese textile imports, more than one-fifth of U.S. imports of textiles and clothing from China.

The U.S. is likely to sign the agreement in Geneva as early as Tuesday, officials said.