EU backs textile deal, Denmark slams quotas
(Reuters)
Updated: 2005-09-08 06:50

"I believe that the agreement to limit Chinese textile exports to the EU does not take into account the realities of modern international commerce," Anders Fogh Rasmussen told an economic convention in Paris.

"This example of protectionism takes place in an area where companies have had 10 years to prepare for the competition from China. Such protectionism is bad policy for Europe," he said.

NEW TENSIONS?

Trade experts in Brussels say tensions could rise again in coming months, just as the European Commission prepares for a meeting of the World Trade Organisation in Hong Kong in December which will seek to further unshackle global commerce.

The EU has launched investigations into whether several categories of shoes imported from China are being dumped on European markets, an issue which is sensitive for some of the countries that pushed for the new quotas for Chinese clothes.

"We are worried about possible incentives to get the support of producer countries (for the textiles deal)," said Alisdair Gray, a director of the British Retail Consortium, saying retailers feared anti-dumping procedures might be accelerated.

In speeches earlier this week in China, Mandelson stressed he believed that "managing trade" with quota systems was not a long-term option but that he also had to "manage public pressures" from the member states he represents.

The European Commission spokeswoman said assurances had been given to EU member states that Chinese goods entering the region would be closely monitored, as sought by France in return for its support for the deal.

A diplomat said Germany was concerned that goods contracted months ago but not yet shipped to the EU might not able to enter the region under the agreement. German retailers had the largest number of such contracts outstanding, the diplomat said.

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