This is a work I wrote in 2005 for my International Business Class

By H.W.C

April 21, 2005

INTERNATIONAL NEWSPAPER REPORT-Trade & Investment

ARTICLES
EUROPEAN OFFICIALS DOWNPLAY CHIRAC’S WAR ON CHINESE TEXTILES
By Toh Han Shih. 16 April 2005. South China Morning Post
&
GET OUT OF THE FIRING LINE, HK FIRMS TOLD; MVES BY US AND EUROPE TO IMPOSE QUOTAS ON CHINA-MADE GARMENT PROMPT TDC CALL TO SHIFT PRODUCTION FROM MAINLAND
By Toh Han Shih. 8 April 2005 South China Morning Post
&
UNDERWEAR COVERS THE REAL ISSUE BEHIND US POSTURING ON TEXTILE
By Neil Gough. 9 April 2005. South China Morning Post
&
US JUMPS GUN ON TEXTILE SAFEGUARDS; ‘SELF-INITIATED’ INVESTIGATIONS POSE THREAT OF NEW QUOTAS ON MAINLAND PRODUCTS
By Toh Han Shih. 6 April 2005. South China Morning Post

COUNTRY
CHINA (HONG KONG SAR)

Summary:

These articles discuss the issue of the United States (US) and European Union (EU) going to impose quotas on Chinese-made textiles and garment products. Thus Hong Kong’s manufacturers are warned to move their factories to other countries with lower tariffs.

This year, the US has initiated the trade investigations on the import of Chinese textiles, which may lead to the imposition of import quotas on Chinese textiles. Since there is a dramatic increase in the importation of low price Chinese textiles, the US-made textiles will face a high competition. The purpose of the import quotas is to prevent the disruption of the textile manufacturing industry in US; the goal of the quotas is to limit the import growth to be under 7.5 percent a year. However, the action of imposition of quotas may tarnish the relationship between the US and China.

In the mean time, French President Jacques Chirac has recently announced his declaration of a war on Chinese textiles. However, on 15 April the EU officials in Hong Kong have already declared that the EU will not impose any trade restrict on Chinese textiles in a short time. In order to impose trade restriction on Chinese textile, it may need a detail research and need to consult with China government before the final imposition. In addition, some people argue that under the World Trade Organization (WTO) rules and the EU’s guidelines, the imposition of trade quotas on Chinese textiles will not seem to happen. Within the EU, on the one hand, the textiles industry in France and Italy is one of their very important industries, which will support the imposition of the trade quotas; on the other hand, most other EU nations would rather to buy Chinese textiles.

As a result of the possibility of imposing quotas on Chinese textiles from the US and the EU, companies manufacturing textiles in China may face difficulty to sell their products to these countries. Hong Kong with about $196 billion of garment exports last year to the US and the UN, the imposition of quotas would have a great influence on Hong Kong’s economy. Thus Hong Kong’s manufacturers are warned to move their factory from China to other countries which do not have the restriction from the trade quotas.

Click here if you want to use this Article!

Continue Reading This Post:123