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Brussels (pte031/17.05.2005/15:02) - European Union Trade Commissioner Peter Mandelson has called for discussions with China regarding the of limiting t-shirt and flax yarn exports into the European Union before EU quotas are imposed. This follows pressure exerted on China by the US, which is also seeking to protect its domestic industry.
"In view of the seriousness of market disruption in these categories," Mandelson said, "formal consultations need to begin immediately." He continued, "At the end of these consultations, we will be entitled to place reasonable and temporary limits on these categories unless Chinese action makes this unnecessary."
China's t-shirt exports to the EU have risen 187 since 1 January 2004, the end of the forty-year system of global textile quotas. Clothing manufacturers such as Euratex, and also countries such as France and Italy have been trying to raise the issue of related job losses since March this year - constituting 1000 jobs a day, according to Euratex. T-shirt production in Portugal has fallen by 50 per cent, 12 per cent in Greece, and flax yarn sales have dropped by 25 per cent.
The Chinese government has been criticised by the US and the EU for keeping its currency artificially low.
China has threatened to enlist the aid of the World Trade Organisation to fight the US restriction on Chinese textile imports, to which the government expressed 'strong displeasure and firm opposition'.
If China doesn't respond within 15 days the EU will be allowed to take action under a 2001 WTO agreement.
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