ATMI Calls For New Quotas On Surging Chinese Imports

Washington, DC — Citing a record 119% increase in textile imports from China during the first six
months of 2002, the American Textile Manufacturers Institute (ATMI) is petitioning the Committee
for the Implementation of Textile Agreements (CITA) to impose special textile quotas on the
following products: knit fabric, gloves, dressing gowns, brassieres and textile luggage. (Note:
CITA is the interagency committee which administers the United States textile/apparel import
control program.)ATMI is also asking CITA to prepare a case for the possible imposition of a quota
against imports of textured filament yarn from China in the event that imports of that product
continue to rise. The ATMI request covers categories for which ATMI member companies make the
products or the components that go into the products. ATMI is urging such action under the
provisions of the China WTO accession agreement, which allows countries to impose textile-specific
quotas in the event that Chinese exports cause or threaten to cause market disruption. The use of
the temporary quota is allowed until December 31, 2008 only for products that have already been
removed from quota-control under the terms of the WTO Agreement on Textiles and Clothing.An ATMI
analysis of trade figures shows that imports of Chinese textile products are currently experiencing
their largest surge in history. ATMI notes that the textile safeguard provision was specifically
included in the China WTO accession agreement to restrain such surges. Last year, under
extraordinary pressure from currency-devalued imports from China and other Asian countries, the
U.S. textile industry closed 116 textile mills and lost 67,000 jobs.During the first six months of
the year, Chinese exports of textile and apparel products to the United States increased by almost
900 million square meters, with the textile portion increasing by more than 700 million square
meters. On the strength of this increase, China surpassed both Pakistan and Canada to become the
second largest textile and apparel exporter to the United States, shipping 1.9 billion square
meters during the first six months of the year. China accounted for 60 percent of the increase in
world-wide imports of textile and apparel products during the first half of the year.The Chinese
increase has come mostly in categories from which quotas were removed on January 1, 2002. In almost
every case, these increases have gone hand in hand with double-digit price declines for imported
Chinese goods. In terms of individual categories, these stand out:1) Knit fabric Chinese knit
fabric exports rose 22 thousand percent and the average price of Chinese knit fabric dropped by 60
percent, catapulting China from being the 26th largest supplier of such exports to the U.S. to the
5th place among all foreign suppliers;2) Gloves Chinas exports of gloves to the United States
tripled over the last six months, with the result that Chinese exports are now twice as large as
those from the next largest supplier;3) Nightwear/Dressing Gowns Chinese exports of nightwear more
than quadrupled, vaulting China from seventh to first place among supplying countries. The Chinese
surge was accompanied by a 47% drop in Chinese prices;4) Brassieres In less than six months, China
leapfrogged the top two long-standing largest suppliers Mexico and the Dominican Republic as Chinas
price per dozen dropped to $29, by far the lowest of any major supplier;5) Luggage Chinese exports
of textile luggage have quadrupled to 71 million kilograms while imports from every other supplier
have simultaneously dropped, some by as much as 60 percent. Chinese prices fell by 62% during the
same period of time. China now ships more than five times as much as the next largest supplier;6)
Textured filament yarn Chinese exports have only recently begun to surge and remain relatively
small. However, over the past two months, Chinese exports increased at a rate of 400,000 kilograms
a month. In its request to CITA, ATMI stressed that “it is now time for CITA to act expeditiously
in restraining the import surges already occurring in order to prevent further damage to an already
beleaguered U.S. domestic sector.” ATMI also noted that the Chinese surge “further damage an
industry that in 2001 suffered its worst year since the Great Depression.”