Quotas on clothing imports anger China

By Ted Anthony
Associated Press

BEIJING — China expressed displeasure yesterday at a U.S. government decision to limit Chinese clothing entering the United States to protect American companies, the latest salvo in economic tensions between two nations whose relationship helps define global trade.

U.S. officials announced Tuesday that the Bush administration was granting an industry request to impose quotas on Chinese imports of knit fabric, dressing gowns and robes and bras — a move that comes in response to a $103 billion U.S. trade deficit with China last year.

"The U.S. administration's decision to request negotiations regardless of China's strong opposition runs against (World Trade Organization) principles on free trade," said Ministry of Commerce spokesman Chong Quan, cited in a dispatch by the government's Xinhua News Agency.

"China reserves the right to lodge lawsuits ... to safeguard the interests of Chinese industries," he said.

The expression of dismay came hours after Dow Jones Newswires reported that China had canceled its second buying trip to the United States in retaliation to the new trade sanctions. A source arranging the planned delegation told the agency that the trip was scrapped after Washington announced the quotas.

The United States estimates that its trade deficit with China will expand to more than $120 billion this year. That could prove problematic for Bush's administration, which wants to show its willingness to protect American workers ahead of the 2004 presidential elections.

The U.S. textile industry earlier this year petitioned Washington for import relief through quotas under a provision that China had accepted to gain membership in the World Trade Organization. It joined WTO in 2001.

Last week, China's first trade delegation signed deals to purchase U.S. automobiles, jet engines and commercial aircraft worth more than $6 billion.

Dow Jones said the canceled delegation's "Made in America" shopping list had included agricultural goods, such as soy beans and cotton, as well as chemical fertilizer, aluminum and telecommunications products. The group had planned to leave yesterday for the 10-day trip.

The U.S. Committee for the Implementation of Textile Agreements voted on Monday to invoke the "safeguard relief" on dressing gowns and robes, knit fabrics and bras imported from China. It cited market disruptions in the United States and said WTO rules permitted the safeguards.

Chong called on Washington to "fully recognize the barrier that special safeguard measures will have on the China-U.S. textile trade and its negative impact on bilateral trade and economic relations."