China trade dispute talks stall
Top trade negotiators for the European Union and China struggled to resolve a bitter trade dispute today with no hint of a solution in sight.
Talks between EU Trade Commissioner Peter Mandelson and China’s Commerce Minister Bo Xilai were continuing tomorrow in Beijing, and centred on 75 million garments piling up at European ports after Chinese textile imports exceeded 2005 quotas.
Negotiations that began this morning stalled over a few major points, said Peter Power, Mandelson’s spokesman.
“There have been constructive talks between the EU and China, and the two sides are broadly in the same place about how to deal with the overshoot in certain textile quotas,” Power said.
“This will lead to unblocking of the goods held at the borders, but there are some important aspects still to be reached, and discussions are continuing at expert levels.”
Chong Quan, a spokesman for China’s Ministry of Commerce, said both sides had “serious negotiations”.
“We had in-depth exchanges of opinions. China adopted a cooperative and practical attitude. China will continue to research a solution for the problem,” he said.
Neither Power or Chong would give further details.
Without a resolution, goodwill during an EU-China summit aimed at strengthening already vigorous trade ties would likely to be strained during the meeting scheduled to begin tomorrow.
European retailers have warned that the blocked shipments could force stores into bankruptcy and shoppers into facing empty shelves in the next few months.
Talks with Bo were “friendly, they’re productive, they’re going well,” Mandelson said earlier, but he did not give any details.
Since the end of global quotas on January 1, American and European textile producers have complained that a flood of inexpensive Chinese goods have deprived their people of jobs and forced plants to close. The EU and US have been seeking limits to protect their manufacturers.
In June, Mandelson and Bo hammered out a textile accord that could bring forward 2006 or 2007 import allowances to ease the holdup of millions of euros worth of sweaters, bras and other garments at EU ports. But Chinese state media has said Beijing might be unwilling to use up next year’s allowance early.
Mandelson said his main goal was to reassure China that ”we went into this agreement together”.
“It’s strong, it’s robust, it will endure,” he said. ”Whatever teething troubles it has, we will sort them out together.”
The two sides enjoy a healthy trade relationship that soared to 150 billion euros last year.
According to EU figures, China was the EU’s second most important partner in 2004, after the US.
Last week, Mandelson said that he had started moves to unblock the hold up at European ports. He declined to elaborate but said in a BBC interview that if his proposals were backed, the Chinese goods could be freed up by mid-September.
Mandelson was accompanying EU Commission President Jose Manuel Barroso, who said that the European side will deal with the issue “constructively through dialogue”.
“The goods will not be held up for a moment later than we can avoid,” Barroso said.
The EU officials will be joined by Britain’s Prime Minister Tony Blair tomorrow for the annual EU summit, which this year is aimed at strengthening ties with China and India, Asia’s burgeoning economic superpowers.
