US Wipes Out Actions On Import Safeguard Petitions

The US government has suspended
action on some 24 import safeguard petitions covering 42 categories of Chinese imports of textiles
and apparel and released products that were embargoed earlier this year. The products had been held
in bonded warehouses because they exceeded permissible quota levels.

The actions were taken to clear the slate for a new set of quotas on Chinese imports that
will go into effect January 1. The release of the embargoed goods was part of the comprehensive
agreement between the United States and China, placing quotas on some 32 textile and apparel
product categories. The embargoed goods now can be delivered to US importers for sale to consumers.
Products released from the embargo include cotton and man-made fiber trousers, cotton and man-made
fiber knit shirts, brassieres and underwear.

The released product categories are included in the comprehensive agreement covering imports
from January 1, 2006 through 2008, as well as other products. That agreement provides for import
restraints on 32 of the most sensitive product categories. While growth rates vary somewhat from
category to category, the general growth rates for apparel categories are set at 10 percent in
2006, 12.5 percent in 2007 and 15 percent in 2008. For textile products, the growth rates are 12.5
percent in 2006 and 2007 and15 percent in 2008.

While the agreement covers all of the product categories US manufacturers consider the most
sensitive at this time, they reserve the right to petition the government to impose safeguard
quotas on additional product categories should the need arise and can be justified. Importers,
however, say they are opposed to future use of the safeguard mechanism, which they have opposed
from the outset.

December 2005