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Last Updated: Monday, 29 August 2005, 20:52 GMT 21:52 UK
EU makes move to end textile row
Seamstresses at a Chinese textile factory
Chinese textile imports to Europe have surged since the start of 2005
The European Union's trade chief has begun moves to free up Chinese garments held at EU ports in a row over quotas.

As he began talks with member states, Trade Commissioner Peter Mandelson vowed to do everything in his power to end the deadlock.

He also played down fears that the row could lead to a clothing shortage that may leave retailers with empty shelves.

But Chinese state media has demanded an immediate end to quotas, accusing the EU of protectionism.

As he began a round of one-to-one negotiations with EU members Mr Mandelson refused to give details about how he planned to clear the backlog of goods such as trousers and bras.

I have set in motion procedures to unblock the goods that have been caught
Peter Mandelson

Experts believe he could put forward two solutions - one would allow China to bring forward some of its 2006 quota allowance to this year.

The other involves raising overall quota limits - but that is likely to be opposed by EU members with large textile industries.

Stranded goods

Mr Mandelson has insisted fears that holding goods at EU ports would lead to a shortage of winter stocks for retailers were far-fetched.

"I cannot accept that EU retail businesses should be penalised unfairly by the agreement with China," he added.

"I have set in motion procedures to unblock the goods that have been caught," he told a press conference in Brussels.

With the co-operation of EU member states, Mr Mandelson said he hoped the goods "stranded" at European ports could be released by the middle of September.

However, the EU's retailers representative, Xavier Durieu, accused Mr Mandelson of doing too little too late and condemned EU blocks on Chinese goods - adding the move was penalising retailers.

Importers shows Chinese sweaters held up in French warehouse
Millions of items are held up in European customs warehouses

Mr Durieu accused Brussels of failing to foresee the problem - which had forced companies to either pay out extra for new goods to fill their shelves amid fears empty shops would scare off customers, or lose their profits as their stocks remained locked in warehouses.

Retailer fears

With around 50 million sweaters and 17 million pairs of trousers detained at European ports, stores across the continent are anxious that the clothes are released in time to prepare for the Christmas rush.

"It is very possible that towards November or December you will see prices rising across the UK simply because there is not enough capacity now to produce the kind of cheap goods that China has excelled in," said Alisdair Grey, from the British Retail Consortium.

But despite widespread claims that China is flooding western markets with cheap goods - some manufacturers worst hit by the quota system are actually owned by European firms, BBC Beijing correspondent Rupert Wingfield-Hayes has found.

One British-owned factory, which produces high-quality cashmere sweaters for customers including Burberry and Jaeger, says it has been thrown into disarray.

The owner told Mr Wingfield Hayes he is now hunting for factories in South Asia to take up the extra work.


BBC NEWS: VIDEO AND AUDIO
Watch Peter Mandelson's statement



SEE ALSO:
China textile bottleneck tightens
23 Aug 05 |  Business
Stores angry at EU clothing curbs
18 Aug 05 |  Business
US-China on verge of textile deal
18 Aug 05 |  Business


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