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"Good Chance" of China, US Textiles Agreement - Chinese Official

Posted on: Wednesday, 17 August 2005, 18:00 CDT

Text of report by Hong Kong newspaper Ping Kuo Jih Pao "Apple Daily" website on 16 August; subheadings as published

Prior to President Hu Jintao's visit to the United States in September this year, China and the United States will hold a new round of trade talks on textile apparels in San Francisco on Tuesday and Wednesday [17 August]. A representative of the China National Textile Apparel Council expressed his view that Sino-US trade disputes on textiles, which had lasted for nearly three months, would have a good chance to eventually reach an agreement. However, the demand of the United States will certainly be higher then that of the European Union. The US textile industry wants a deal that will limit imports of Chinese products in at least 19 categories of apparel to a 7.5 per cent growth rate per year.

According to the latest data released by the US Department of Commerce, the United States' unfavourable trade balance with China again set a new record in June, rising from 15.754bn dollars in May this year to 17.594bn dollars. It was mainly due to the record import of Chinese textiles, which reached 21bn dollars. In June and the first half of this year, China's total export of textile apparels to the United States increased by 40 per cent and 58 per cent respectively.

The record trade imbalance obstructs talks

A responsible person of the China National Textile Apparel Council told this reporter that the further expansion of the US trade imbalance with China has increased difficulties in the current talks. He would not reveal the stakes of the Chinese side in the talks, but noted that the Chinese side had prepared several plans. It was learned that the Ministry of Commerce last week invited responsible persons of some 50 large textile enterprises to a meeting in Beijing in order to solicit their opinions on technical matters in talks between China and the United States. The meeting was considered as the preparation of "lessons" for the Ministry of Commerce prior to the Sino-US trade talks.

It was learned that Vice-Minister of Commerce Gao Hucheng had already led a delegation to the United States to attend the new round of negotiations between the two sides. David Spooner, chief representative of the US side will lead the US delegation, which will also include officials from the Departments of Commerce, State, and Treasury, as well as the Office of the US Trade Representative. David Spooner said that US textile groups and members of the Congress hoped to negotiate a so-called "comprehensive deal" in textile trade with China. He said the goal of the current talks was to seek a long-term solution.

It was also learned that both Chinese and US sides world strive to gain achievements in the current talks so that, when President Hu Jintao visits the United States in the next month, the two countries could include textile apparels in the framework of a series of economic and trade agreements.

The quota system causes the European Union a loss of 800m euros

A person of the business circles in Hong Kong pointed out that an early agreement between China and the United States to solve disputes on textile products would be conducive to removing the unclear situation in the market. Since the trade talks between China and the United States have not formally begun, it would be hard to evaluate its influence on business circles in Hong Kong.

Besides, news from retailers in Europe pointed out that, in the wake of imposing quotas on Chinese textile apparels by the EU, large quantities of Chinese made T-shirts, dress shirts, pants, and other items were stored at port facilities, causing losses of more than 600m euros to retailers in Europe.

Source: BBC Monitoring Asia Pacific

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