EU trade curbs on China possible

The European Union trade commissioner Peter Mandelson has demanded greater curbs on Chinese exports of textiles and clothing after trade-restricting quotas were removed earlier in the year.

He said: “China must trade freely and fairly. If there is a perception that China is reaping the benefits of free trade without meeting the standards of fair trade, there will be a negative response in Europe and elsewhere.”

Mr Mandelson also raised the possibility of using a “special safeguard mechanism” to curb Chinese textiles imports into Europe, which have risen sharply over recent years. This mechanism, negotiated during the process that culminated with China’s accession to the World Trade Organisation, allows countries unilaterally to restrict textile imports from China. It has never been used by the EU.

Coupled with criticism of China’s lack of protection for intellectual property rights and the need for a bigger Chinese contribution to WTO trade talks, Mandelson’s remarks suggest he intends to take a tough line on China. This, in spite of the fact that Brussels has in the past tried to avoid the more aggressive stance favoured by the US, which has been more openly critical of China’s trade policies.

Mandelson explained that “There is a view in China that it has already paid heavily to enter the WTO. But WTO membership is not the end of the reform path but just the end of the beginning. China has to work harder to ensure that its own markets are open to international competition fair and transparent terms.”