LexisNexis(TM) Academic - Document
LexisNexis(TM) Academic - Document
Copyright 2005 The Financial Times Limited
Financial Times (London, England)
June 14, 2005 Tuesday
London Edition 2
SECTION: LEADER; Pg. 18
LENGTH: 476 words
HEADLINE: Textiles stitch-up: Whatever the EU and China say, their deal mocks free trade
BODY:
The European Union's agreement with Beijing restricting China's textiles and clothing exports has been greeted with much self-congratulation by both sides and no little gloating by Peter Mandelson, the EU's trade commissioner. He has trumpeted the deal as a triumph for emollient European diplomacy and dismissed US trade tactics, in contrast, as crudely confrontational.
But it is hard to see anything to commend the deal - other than to Europe's mollycoddled textiles industry. However dressed up, it is pure protectionism. No amount of public relations spin can conceal the fact that it was reached only after Brussels threatened to use against China the same import quota provisions in its World Trade Organisation membership agreement that the EU now piously condemns the US for invoking.
By cutting a deal with the EU rather than see it impose quotas unilaterally, China has won something - but not much. The annual growth of its exports will be limited to between 8 and 12.5 per cent, compared with the 7.5 per cent provided for by WTO quotas. That compares with increases in its exports of as much as 500 per cent in the first quarter.
Mr Mandelson's efforts to portray the deal as a "transitional arrangement", until WTO rules oblige Brussels to end the quotas in 2008, are risible. The EU and US committed themselves a decade ago to lifting global textiles curbs at the end of last year. Instead of preparing for that deadline, they sat on their hands. Now they are busy putting trade barriers up again.
By so doing, they are inviting other industries to lobby for similar treatment. European shoemakers want Chinese imports curbed. So do bicycle makers - even though most cycles sold in the EU are made of imported parts. The list will doubtless grow.
Alas, the demands are all too easy to meet. As well as imposing dumping duties, of which China is already the biggest target, its trade partners may legally restrict until 2013 any of its exports they judge to be disrupting - or merely threatening to disrupt - their markets.
Years of trade protection have not saved weak western industries from decline. Nor will yet more trade barriers do so. They will, however, frustrate structural change and penalise poor US and European consumers, who spend much of their income on the basic products of which China is among the lowest-cost producers. Now their own governments have decreed that they must pay even more.
This is cynicism of a high order. But it is what happens when politicians pander cravenly to narrow vested interests. All history shows that once protectionist weapons are created petitioners will spring up to demand they be used. That Beijing has connived in this stitch-up and that the deal will no doubt be applauded by other developing countries whose textiles exporters fear Chinese competition make it no less a travesty of free trade.
LOAD-DATE: June 13, 2005
Copyright 2005 The Financial Times Limited
Financial Times (London, England)
June 14, 2005 Tuesday
London Edition 2
SECTION: LEADER; Pg. 18
LENGTH: 476 words
HEADLINE: Textiles stitch-up: Whatever the EU and China say, their deal mocks free trade
BODY:
The European Union's agreement with Beijing restricting China's textiles and clothing exports has been greeted with much self-congratulation by both sides and no little gloating by Peter Mandelson, the EU's trade commissioner. He has trumpeted the deal as a triumph for emollient European diplomacy and dismissed US trade tactics, in contrast, as crudely confrontational.
But it is hard to see anything to commend the deal - other than to Europe's mollycoddled textiles industry. However dressed up, it is pure protectionism. No amount of public relations spin can conceal the fact that it was reached only after Brussels threatened to use against China the same import quota provisions in its World Trade Organisation membership agreement that the EU now piously condemns the US for invoking.
By cutting a deal with the EU rather than see it impose quotas unilaterally, China has won something - but not much. The annual growth of its exports will be limited to between 8 and 12.5 per cent, compared with the 7.5 per cent provided for by WTO quotas. That compares with increases in its exports of as much as 500 per cent in the first quarter.
Mr Mandelson's efforts to portray the deal as a "transitional arrangement", until WTO rules oblige Brussels to end the quotas in 2008, are risible. The EU and US committed themselves a decade ago to lifting global textiles curbs at the end of last year. Instead of preparing for that deadline, they sat on their hands. Now they are busy putting trade barriers up again.
By so doing, they are inviting other industries to lobby for similar treatment. European shoemakers want Chinese imports curbed. So do bicycle makers - even though most cycles sold in the EU are made of imported parts. The list will doubtless grow.
Alas, the demands are all too easy to meet. As well as imposing dumping duties, of which China is already the biggest target, its trade partners may legally restrict until 2013 any of its exports they judge to be disrupting - or merely threatening to disrupt - their markets.
Years of trade protection have not saved weak western industries from decline. Nor will yet more trade barriers do so. They will, however, frustrate structural change and penalise poor US and European consumers, who spend much of their income on the basic products of which China is among the lowest-cost producers. Now their own governments have decreed that they must pay even more.
This is cynicism of a high order. But it is what happens when politicians pander cravenly to narrow vested interests. All history shows that once protectionist weapons are created petitioners will spring up to demand they be used. That Beijing has connived in this stitch-up and that the deal will no doubt be applauded by other developing countries whose textiles exporters fear Chinese competition make it no less a travesty of free trade.
LOAD-DATE: June 13, 2005
posted by Eastlaw at 9:04 AM
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