BRUSSELS, Belgium: Clothing importers demanded on Thursday that the European Union reject pleas from some member states and manufacturers to extend quota restrictions beyond this year on cheap Chinese-made bras, T-shirts and trousers.
The 27-nation bloc is counting down to the end of the cap on Chinese exports on Dec. 31, which could spark a new battle between European manufacturers and importers over surging Chinese imports.
EU trade ministers will outline what their governments want when they dine with EU Trade Commissioner Peter Mandelson on July 22. EU member states must approve any changes to the current system — but they are as divided as European businesses are on the benefits and dangers of Chinese goods.
Shoppers in Britain and Ireland have seen clothing prices fall by half as stores like Primark and Tesco offer bargain jeans and summer dresses made cheaply in China. Low-cost retailers such as Sweden's H&M are booming as consumers flock to stores to snap up well-priced fashion.
But Italians and Spaniards may be more worried about job losses and closures as small textile firms fail to compete with cheaper Asian imports.
The Foreign Trade Association, which represents importers, warned that shops have already placed orders for next year assuming that the restrictions will be scrapped."Any prolongation to this restrictive system ... creates uncertainty for retailers and importers ... and finally simply serves to protect further those industries in the EU that have remained uncompetitive," it said.
Over the next few days, Mandelson will try to find common ground, meeting industry representatives from both sides while EU officials will also ask China for help in managing "a stable transition" to the new quota-free situation next year.
That means steering clear of the trigger for the last round of "bra wars": a massive frontload of export orders the minute the quotas are lifted as happened in early 2005.
European storeowners bleated that their shelves would be empty because their goods were impounded at ports for exceeding the quota — a situation partly caused by the huge boost in retail orders.
China helped soothe the row then — and helped Brussels save face — by agreeing to limit trade flow increases by up to 12.5 percent a year until 2008.
The EU is asking for good behavior from everyone to prevent a repeat performance.
Mandelson "will urge importers, retailers and textile producers to work with member states and do what they can to ensure a smooth and problem-free transition," the Commission said.
He promised to closely monitor textile and clothing trade flows from China.
Europe has warned China that it must tackle its huge trade surplus with Europe and do more to open up to foreign businesses and investment by scrapping trade barriers faced by European companies.
The EU is also pressing for "a sea change" in intellectual property rights and copyrights that should eliminate counterfeits from Chinese street markets and ensure Chinese companies pay royalties to European companies for using their technology.
Chinese Commerce Minister Bo Xilai told Mandelson last month that Beijing was aware the current trade imbalance with Europe was not sustainable. Officials will discuss progress on this at a November summit.
