Coalition Attacks China-EU Textile Deal

The 97-member Global Alliance for Fair Textile Trade (GAFTT) which represents 97 trade groups from
55 countries in Europe, Asia, Central America, Mexico and the United States has blasted a European
Union-China plan to release some 83 million in textile imports that had been embargoed when China
exceeded it quotas. The EU/China agreement is expected to allow immediate entry of all of the
textiles and clothing that had been embargoed. Under the new arrangement, 50 percent of the goods
will be permitted to exceed the quota agreement and the remaining 50 percent will be charged
against 2006 quotas.

Charging that the importers caught in the embargo took a calculated business risk and got
burned, Cass Johnson, president of the National Council of Textile Organizations, a GAFTT member,
said: “The EU-China textile deal unfairly penalizes textile and clothing producers from the rest of
the world who play by the rules.”

Auggie Tantillo, executive director of the American Manufacturing Trade Action Coalition,
another GAFTT member, said China contributed to the EU embargo problem by eliminating its export
licensing requirements early this year. He said granting China additional access to the EU market
simply rewards China for its own irresponsibility.

Last June, China and the European Union agreed to place import quotas with annual growths
ranging from to 8 to 15 percent on 10 product categories. The action was taken in response to an
increase in imports from China that EU officials called an unprecedented surge of imports in
several product categories.

GAFTT used the EU action to reiterate its efforts to persuade the World Trade Organization to
take actions that would prevent China, India and a handful nations from monopolizing the world
textile markets. GAFTT wants to see a permanent safeguard mechanism to protect domestic
manufacturers in countries where it can be demonstrated that imports are disrupting their markets.

September 2005