EU Commission agrees on guidelines for possible emergency

The European Union's head office agreed on guidelines Wednesday on how far Chinese textile imports can increase before the EU considers emergency barriers to protect its domestic industry.

"There are serious concerns about the impact of a surge of Chinese imports on EU textile industries," EU Trade Commissioner Peter Mandelson said.

Under the guidelines, he said, increases of between 10 percent and 100 percent on 2004 levels would trigger an EU investigation and informal talks with the Chinese on possible protection measures.

Adopting the guidelines does not automatically mean the EU would adopt barriers to Chinese imports, Mandelson said, but added that he did intend to use them if needed.

The guidelines aim to show European textile companies when they can seek quotas to keep out cheap Chinese competition. They will also give retailers a clearer idea of how long they can keep buying from China before the barriers go up.

The EU has faced calls from European producers to take action against Chinese imports following the expiration of a global quota system on Jan. 1, which has led to an increase of Chinese exports on European and U.S. markets.

The U.S. government said Monday it will bring trade cases against China to determine whether quotas should be re-imposed to protect textile and clothing manufacturers.

However, the 25 EU nations are not united on the question. Textile producers such as Portugal, France and Italy are particularly worried about Chinese imports.

Mandelson said the EU was still studying data on increased Chinese imports since the start of the year and it was to early to decide on action.

He called the guidelines "a serious and judicious attempt to set a balance between the need to open trade ... and the need to give assurances that we will be able to act effectively and on time to mitigate a sustained import surge."

A clause of China's 2001 entry agreement into the World Trade Organization allows other WTO nations to use safeguards to protect against sudden and sustained surges in textile exports.