Free Trade? Textiles, Shoes & Steel Pipes

Related entries: General, News, Risk & Law, Trading

The 3-year China-U.S. textile agreement went into effect earlier this month, with quotas being introduced on 21 types of clothing and textiles from China by 2008. The Chinese agreement with the EU has also started operation. While not ideal, hopefully the structures will create greater certainty for traders, and will help smooth trade relations between the parties.

In a positive move from the US, President Bush has rejected (renewed) calls for quotas on steel pipes from China. He cited the fact the benefits for local producers were outweighed by the potential negative impact on US consumers (an argument which many felt should also have been made in the case of textiles).

On the EU side (where around 50 anti-dumping measures are already in effect) problems over the import of Chinese shoes are proving more difficult to solve. The EU is threatening to impose anti-dumping tariffs on shoe imports from China (worth US$600 million a year), while the Chinese may seek arbitration at the World Trade Organisation (WTO). China claims the EU shoe industry was already in decline before the lifting of quotas – a claim that Brussels is investigating?

The protectionist attitude that is sometimes displayed by the EU and US may play well to small constituencies of domestic manufacturing companies and their communities, but ultimately it harms the interests of the broader consumer market, is unlikely to protect uncompetitive western producers in the long term, and risks damaging the development of positive relations with China.

See related articles:

    US, China begin textile quota system
    Monsters and – Glasgow,UK
    BEIJING, China (UPI) — The Sino-US textile agreement has gone into effect, imposing quotas on 21 types of clothing and textiles from China by 2008. …

    China hails Bush’s rejection of quotas on steel pipe
    Xinhua – China
    … The Chinese Government welcomed the rejection by US President George W. Bush of a request to impose quotas on steel pipe imported from China, a spokesman for …

    China raises stakes in EU shoes battleFinancial Times – London,England,UK
    China warned on Thursday that it might seek arbitration at the World Trade Organisation if the European Union went ahead with its threat to impose anti-dumping …

2 Responses to “Free Trade? Textiles, Shoes & Steel Pipes”

  1. Jeremy Gordon Says:

    Author : sarvpriya (IP: , E-mail :
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    thats good.

  2. Archive » The Antipodean (Free Trade) Approach| China Business Blog Says:

    […] ntries: General, Trading As the EU and US battle with China over cheap shoes, textiles and auto tariffs, New Zealand is busy negotiating a free trade agreement. The Dominion […]

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