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US should not impose excessive trade limits
(China Daily)
Updated: 2005-08-19 09:58
China and the United States concluded a two-day round of negotiations over
Chinese textile exports yesterday.
Although the two sides still have "substantial differences," according to
China's Ministry of Commerce, some progress was reported to have been made
through the talks.
After difficult encounters in June on the same topic, this round appeared to
be much less confrontational.
Both sides want to solve the problem currently the most contentious in
bilateral trade and reduce uncertainties for enterprises in the sector.
China signed an agreement with the European Union in June to curb growth of
10 categories of textile products that the nation exports. The move indicates
the country is willing to make concessions.
The approach used in Sino-EU negotiations can be held up as an example for
China-US talks to follow while US negotiators should refrain from being too
aggressive when raising demands.
They are reported to be seeking an across-the-board curb on imports of
Chinese textiles to cover products they believe could pose a threat to the
American market in the future.
On the Chinese side, unlimited scope for restrictive measures is
unacceptable.
The extent to which export growth should be restrained in each category is
certainly also at the heart of the debate.
In Europe there is already a call for easing the 8-12.5 per cent growth limit
stipulated in the China-EU agreement.
In the United States, traders advocate no less than a 20 per cent limit for
Chinese textile export growth.
The US negotiators should listen to these voices when making their decisions.
US textile groups made a strong case in the first few months of the Sino-US
dispute, which erupted in the first quarter of this year.
They linked the loss of US jobs to the country's huge trade deficits to
Chinese textiles.
But after a trade of angry accusations, many Americans found benefits from
moves against Chinese textiles would be limited in their ability to protect US
textile jobs, because competition is not only coming from China. They also found
textiles account for a tiny proportion of Sino-US trade.
At the same time, US groups whose interests would be hurt by the curbs -
traders, retailers and cotton producers - have been making their opinions known.
Gary Hufbauer, a senior expert at the US Institute of International
Economics, was quoted by American media earlier this week as saying consumers in
the United States would have to pay US$6 billion more if the all-around
restrictions on Chinese textiles the US negotiators have proposed are put in
place.
With all of these points of view to consider, American decision-makers may
need to rethink the necessity to ask for excessive concessions from the Chinese
side in the next round of talks.
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