EU plans fresh textiles deal with China

Retailers were promised new plans yesterday to release millions of Chinese-made trousers, sweaters and bras which have been held at customs points across Europe in a dispute over quotas.

Peter Mandelson, the European Union trade commissioner, said he would present proposals to member states today that could see autumn collections on the shelves within weeks.

"The Commission is making proposals to our member states in the morning to begin proceedings to unblock all the goods currently held at customs," Mr Mandelson said in a television interview.

"I hope member states will co-operate with me and won't prevent the speedy passage of those procedures. If they co-operate I believe we will be able to unblock all the goods currently held at customs by the middle of next month."

His comments came as EU officials entered their fourth day of talks in Beijing aimed at ending the dispute that has put about 80 million items, including trousers, sweaters, blouses, bras and T-shirts, into customs limbo. The dispute has been dubbed Bra Wars.

The EU's decision to halt imports of Chinese-made goods that breached a quota agreement made at the end of June has compounded the difficulties already being faced by retailers because of weak consumer spending.

Many have been unable to get import licences for stock that was ordered at the beginning of July because the quotas have filled up more quickly than expected.

The June deal capped growth in 10 lines of Chinese textile exports at 8 to 12 per cent a year, and was hailed at the time as a sensible response to a deluge of low-cost clothing from China.

At the start of the year, an international agreement limiting the amount of clothing imports to the developed world was scrapped.

Although Mr Mandelson gave no further detailson his rescue proposals yesterday, the strategy could include bringing forward some of next year's import quotas or making use of unfilled quotasthis year for certain types of garment.

The 25-nation EU has been split on how to deal with the problem, with Mr Mandelson torn between protecting local textile industries from the influx of cheap Chinese goods, and ensuring shops are not left with empty shelves by Christmas.

The Netherlands, Denmark, Sweden and Finland are warning of job losses among retailers unless the EU eases import curbson Chinese clothing. Countries with big textile industries, such as France, Italy and Spain, have backed the import restrictions.

- INDEPENDENT