Blog: Leonie BarrieChinese whispers

Leonie Barrie | 14 January 2004

Talks between US and Chinese officials over the past two days to discuss US safeguard actions on knitted fabrics, dressing gowns and brassieres have ended without resolution. But should we really be surprised that the two sides failed to reach an agreement over just two days of negotiations?

According to the US Embassy in Beijing the two sides are committed to further dialogue on issues related to bilateral textile trade. How likely this is must be open to question though. Sino-US trade ties might be the closest they have been for years, but the strain of maintaining this stance is starting to show. The official China Daily newspaper said China intends to question the legitimacy of the US initiating the safeguards and plans to impose licensing management and electronic data inspections. On the other hand, US officials are determined to restrain apparel imports from China, at least while textile votes still count.

Under WTO rules, if the two sides fail to agree on future action, the US can unilaterally impose quotas for a year. After then, the US’s interest in selling hi-tech goods to China might take precedence. It’s starting to happen already, with a Chinese purchasing group about to sign contracts to buy more than US$2 billion dollars of IT equipment from US firms according to state media reports.


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