EU, China Reach Deal on Imports

The European Union and China have reached an agreement on unblocking Chinese textile imports held at European borders, the European Commission said Monday.

EU Trade Commissioner Peter Mandelson and his Chinese counterpart, Commerce Minister Bo Xilai in Beijing, reached a deal on future quota limits, allowing some 75 million garments into the EU, EU spokeswoman Francoise Le Bail told reporters.

“The aim is to release as quickly as possible the textiles which are currently blocked at customs,” she said.

The EU’s 25 member states will need to approve the deal before the clothing can go on sale in European stores.

The agreement effectively raises import limits to allow in excess clothing amid growing concern that a flood of cheap Chinese goods undercuts European producers.

European governments still have to agree on the details of how the extra imports should be unblocked.

Mandelson said Friday that European governments had reached “broad agreement” on his proposal to allow in goods ordered and shipped during the month after a June 10 textile deal with China and subtract goods ordered after July 12 from next year’s quota.

European retailers have lobbied hard for the garments to be released, saying that stores would not be able to stock fall and winter clothing lines ordered from China.

Alisdair Gray of the British Retail Consortium said it could take as long as a week for imports to be taken out of warehouses.

“We are going to get products onto the shelves as soon as possible,” he said Monday before the announcement.

He said the EU executive commission would have to work closely with retailers to avoid congestion if all the goods were released on the same day.

Gray said he was also concerned about long-term implications of the deal.

“We need Commissioner Mandelson ... [to] explain what it took to get France and Italy on side,” he said. “Will there be quotas in the future in other product areas? Will there be anti-dumping duties on shoes, on shirts, on CDs and on DVDs?”

The European Commission has placed 10 categories of Chinese textile products, including T-shirts, sweaters and bed linens, on a watch list and recently opened an investigation into claims that Chinese imports of CDs and DVDs were unfairly undercutting European producers.

It has also started an investigation into claims that Beijing and India are dumping shoes on European markets, and has threatened punitive customs duties on the imports to raise shoe prices.

Chinese shipments of sweaters, trousers and other low-cost clothing soared after a worldwide quota system expired Jan. 1.

The EU negotiated new and higher limits with China in June, but during the monthlong delay before the restrictions came into effect many importers placed huge orders in an attempt to get quota-free goods into Europe before the deadline.

Imports of sweaters, men’s trousers, bras, blouses, T-shirts and linen cloth overshot the new limits barely weeks after the deal was signed.

Actual sweater imports are close to double the 2005 quota of 69 million garments.

Meanwhile, U.S.-Chinese talks on a dispute over American efforts to restrain surging imports of Chinese underwear and other textiles broke down last week.

The U.S. government announced Thursday that it was reimposing quotas in two categories of Chinese clothing and textile imports after its negotiations in Beijing failed to make progress.

The administration said it would limit imports of fabric made with synthetic filament threads and also bras and other body-supporting undergarments.