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China's Textile Exports -- Hung Out to Dry?

China Chamber of Commerce for Import and Export of Textiles issued an alert to domestic textile firms on Monday warning them to suspend the export of six lines of textile products to the United States (US).

According to the chamber's website, the US stopped importing Chinese-made cotton-knitted shirts and cotton and man-made fiber underwear on July 5, and halted imports of cotton trousers on July 8. It also predicted the US will soon shut the door to Chinese man-made fiber shirts because the US had imported 97.89 percent of the allowed total volume by July 13.

The chamber therefore warned its members to immediately stop exporting these four lines of products to the US to avoid risks.

This is the second time the chamber has alarmed domestic firms on textile exports to the US. The first alert was sent on July 6.

The US Committee for the Implementation of Textile Agreements decided in May to put a 7.5-percent cap on the annual increase of imports of China-made cotton shirts, trousers and man-made fiber underwear, based on its observation that an import surge from China had "caused market disruption" in the US.

Despite several rounds of talks between the two governments, including the just-ended Sino-US annual session of the Joint Committee on Commerce and Trade in Beijing, no breakthrough has been made on the thorny textile disputes.

Chinese textile companies are striving to restructure their export products and expand further into the world market.

"It's a top priority for us to diversify our products and further tap the world market," said a business executive from Youngor based in the city of Ningbo, east China's Zhejiang Province.  "We must not cling to the US market alone."

"Domestic companies have to set up their own early warning systems," the business executive said in a telephone interview with Xinhua on Tuesday. He declined to be named. "We'd be in a passive and embarrassing position if we hastily seek countermeasures only after other countries have imposed restrictions."

As one of China's most recognized name brands for garments, Youngor has avoided producing "100 percent cotton" shirts and jackets after the US slapped quotas on Chinese-made cotton-knitted shirts and pants.

Yet most textile firms are not too fazed by the US restrictions.

"We cannot get anywhere by criticizing the US alone," said Jin Changyi, general manager of Golden Globe Textile Corp in the provincial capital Hangzhou. "The only thing we can do at the moment is to fix our production and marketing strategies to minimize the impacts of such restrictions."

To be specific, Jin said his company will focus on the Middle East and African markets and will increase the proportion of high-end products, particularly genuine silk garments.

Jin's company exports up to 400,000 pieces of cotton and silk garments every year, including approximately 50,000 pieces to the US. Among its importers are leading US retailers including Wal-Mart.

Meida Garments Co., a leading textile exporter in east China's Shandong Province, has gradually replaced traditional cotton clothing with flax products ever since it got wind of potential US safeguard measures last year.

Textile dealers have also called on domestic producers to seek a long-term development of the whole industry rather than merely short-term benefits for individual businesses.

"Many textile plants prefer US orders since they are often big orders and are easy to process," said Guo Haiping, a business representative for the European and American markets with Zhejiang Zhongda Shareholding Group Co. Guo added: "But Chinese textile companies need to set up a self-regulating mechanism to better keep checks on product quantity, quality and prices and create a favorable environment for long-term development."

(Xinhua News Agency July 20, 2005)

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