A stitch in time

Manufacturing News, Source : The Manufacturer US
Published : 23 Dec 2005 14:58

Textile agreement

Bellwethers of the economy aren’t always about statistics and charts; sometimes it’s about action. When US Trade Representative Rob Portman and Chinese Minister of Commerce Bo Xilai announced in November that the United States and China had, after three months of intense negotiations, reached a broad agreement on textile trade, it was a move that boded well for the economies of both countries. It could well serve as a model for future agreements with Asia.

The US textile industry had been vocal in its calls for protection for its products, and it appeared to have been heard. The agreement, which goes into effect on January 1, 2006, and ends on December 31, 2008, places quotas on 34 different textile products, more than the 19 currently subject to China safeguards. The quotas established under the agreement compare favorably to quotas that would have been imposed if China textile safeguards were invoked. The agreement restricts Chinese exports until the end of 2008.

In the meantime, the agreement’s January 1, 2006, start date will allow importers and retailers to prepare for the changes, and the agreement’s three-year lifespan was established to allow private-sector stakeholders to make future plans in a more stable and predictable environment. This sort of foresight could allow a sustainable balance between the two economic powerhouses.

“The US goals have been clear,” said Portman. “We sought an agreement that achieves the stability and predictability sought by our retailers and textile producers, who understandably found it hard to plan in the face of unpredictable safeguards. This agreement is a good example of where, through hard work and good faith, constructive solutions can be found to difficult

trade issues.”

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