Mandelson to Hold Crisis Talks on Chinese Clothing

PETER MANDELSON, the Trade Commissioner, is to convene crisis talks between European Union member states over Chinese clothing quotas, amid fears that retailers will face shortages and price rises this autumn, The Times has learnt.

The talks, to take place as early as this week, come as goods bound for Europe from China, worth an estimated £30 million, have built up in ports because quotas on jumpers and trousers, which were imposed last month, have been filled. Quotas on bras, T-shirts and blouses were more than 90 per cent full yesterday and could be used by next week.

European Commission officials said that the talks were intended to assess the scale of the problem and examine solutions such as using a part of next year’s quotas this year. However, any agreement would not allow the total amount of goods imported over the next three and a half years to exceed the level agreed with China on June 10.

Ten quotas on the import of goods from China were reimposed by the EU on July 12 to protect European manufacturers after long-term quotas were removed in January.

Mr Mandelson has thrashed out an EU deal to allow about 9 per cent of next year’s jumper quota to be used this year but still needs China’s agreement.

EU member states are divided on the problem. Those countries with big clothing manufacturing industries and some new members want quotas to be kept. Retailers in Scandinavia, Germany and the Netherlands fear they could be left out of pocket by the decision to change the rules on imports because they have already ordered goods.

British retailers are switching production to India, Turkey, Sri Lanka and Bangladesh, but some said that this could raise prices or hit profits. Others are thought to be salvaging goods part-made in China by having them finished in other countries.