U.S., China Reach Textile Agreement

Beginning Jan. 1, 2006, and lasting until Dec. 31, 2008, Chinese apparel exports to the U.S. will be subject to a new set of quotas. The 34 types of products covered by a bilateral agreement announced on Nov. 8 include cotton knit shirts, man-made fiber knit shirts, woven shirts, cotton trousers, man-made fiber trousers, brassieres and underwear.

The U.S. and China had been working on an agreement since late summer, following U.S. implementation of temporary and selective quotas under the trade "safeguard" provisions of China's accession agreement to the World Trade Organization.

The new agreement will allow U.S. importers and the Chinese government to manage quotas and avoid overshipments, says the U.S. Trade Representative's office. For example, China, it explains, will be able to manage apparel exports using a visa system and can "borrow" against future quotas to cover overshipments.

"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," U.S. Trade Representative Rob Portman said Nov. 8 in London. "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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