EU warns China about responsible trade

EU trade commissioner Peter Mandelson has warned China against flooding Europe with cheap textiles when quotas are lifted at the end of the year.

Mandelson is coming under pressure from some member states to extend the quotas that limit the annual growth in imports of Chinese textiles, introduced two years ago.

But the commissioner has rejected these demands, saying, that the EU does not propose to extend export restrictions. Instead, the EU intends to monitor Chinese textile exports when quotas are lifted in less than half a year.

Although the EU-China agreement imposes no restrictions on imports for 2008, it does commit both sides to cooperate to ensure a smooth transition when the final import restrictions end.

“I am sending a clear signal that I expect China to show a joint sense of partnership and responsibility in handling these difficult trade issues,” the Times quotes him as saying.

In addition, Mandelson dismissed calls this week for a revaluation of the Chinese currency and the depression of the value of the euro, saying such action would do little to boost European exports to the world's most powerful emerging economy.

However, he did warn Beijing that it was doing too little to open its domestic markets and curb subsidised exports.

Textile and clothing exports to Europe from China - which joined the WTO in 2001 – have experienced a rapid surge accompanied by significant drops in prices.

This surge damaged many EU producers. As a result, the EU and China negotiated the agreement that would cap growth levels of imports from China in ten categories of textiles and clothing at agreed levels each year until the end of 2007.

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