On Monday, Premier Wen Jiabao and textile industry experts urged the US to safeguard global textile integration, saying its recent decision to impose restrictions on Chinese textile imports is a serious threat to the multilateral trading system.
During his meeting with a US Chamber of Commerce delegation in Beijing, Wen said the restrictions were "not good" for the sound development of Sino-US trade relations. "China and the US should proceed from the long-term perspective and work together to safeguard global textile integration," he said.
US Secretary of Commerce Carlos Gutierrez announced on Friday that his government had decided to re-impose quotas on Chinese-made cotton trousers, cotton knit shirts and underwear.
The decision, by the US Committee for the Implementation of Textile Agreements, means the quantity of these goods will be limited to an increase of 7.5 percent this year, compared to shipments over a 12-month base period.
Ministry of Commerce spokesperson Chong Quan said on Saturday that the move "runs counter to WTO agreements on the trade of textile and apparel products as well as the WTO spirit of free trade."
The China Textile Industry Association said on Monday that the restriction means it may have to lay off 100,000 textile workers a year and its investment environment undermined.
Gao Yong, the association's vice president, told Xinhua News Agency that it also "impairs the interests of US consumers and retailers who have benefited a lot from cost-effective Chinese goods."
US retailers are already complaining that the new limits, and more expected to be imposed on other clothing categories, will simply mean higher prices for American consumers.
"Some US investors in China will also suffer because many products from their China facilities are exported back to the US," said Wang Hongxia, a specialist on Sino-US trade relations with the Ministry of Commerce's Institute of International Trade and Economic Cooperation.
An anonymous official in charge of foreign trade said the restrictions amounted to a limit on US cotton exports, since much of the cotton imported to China by textile firms is American. For example, in east China's Shandong Province 182,000 tons of the 465,000 tons of cotton imported last year came from the US.
Zhang Yankai, deputy president of the textile sub-council of the China Council for the Promotion of International Trade (CCPIT), said that "the growth rate of textile and garments exports in March already fell 5 percent year-on-year to 19 percent."
Dr. Jiang Haihong, from the Shanghai-based Consulting Center for WTO Affairs, said "the WTO requires figures from at least 12 months to decide whether exports from another country have actually disrupted the market order of the importing economy" whereas the US based its decision on only three months' figures.
To tackle new challenges, Gao said his association will step up training of domestic textile exporters on world trade laws as well as on ways to solve friction and protect themselves.
"Chinese firms need to improve quality and services and establish more world-renowned brand names to sharpen their competitive edge in the international market," he added.
(Xinhua News Agency May 17, 2005)