The spokesman for China's Ministry of Foreign Trade and Economic Cooperation (MOFTEC) criticized the United States on May 6 for unilaterally deducting 5.1 million US dollars-worth of quotas for textile products from China.

The US government, without providing clear evidence, accused Chinese enterprises of illegally re-exporting textile products to the US, and decided unilaterally to cut the quotas of Chinese textile products by 300 percent. The decision severely violates the bilateral agreement on textile products, the spokesman said.

The Chinese government has always scrupulously followed the provisions of the agreement, and holds that the two sides should develop bilateral trade on the basis of equality and mutual benefit, solve disputes with a practical, understanding and consultative attitude, he noted.

The act of the US government wantonly violates the bilateral agreement on textile products, and is absolutely unacceptable to the Chinese government, he said.

Backgrounder: Sino-U.S. Textile Trade

The U.S. government recently decided unilaterally to cut the quotas of Chinese textiles by 300 percent, which are valued at 5.1 million U.S. dollars, because of Chinese firm's alleged shipments of textiles through third countries.

The textile trade is an important component of Sino-U.S. trade. Since the two countries signed their first agreement on textile trade in September of 1980, China's exports of textiles to the United States have continually increased. In recent years, China's annual exports of textiles to the United States have been worth 4-to-5 billion U.S. dollars.

A fourth Sino-U.S. agreement on textile commodities was due by the end of 1996. To reach a new agreement, the two countries held five rounds of negotiations since October of 1996, and extended the overdue agreement to Jan. 31, 1997.

The new four-year Sino-U.S. textile products agreement was signed on Feb. 2, 1997, which laid the foundation for further development of bilateral trade.

The illegal shipment of Chinese textile products is an important issue in the two countries' textile trade. In June of 1996, the United States, without providing clear evidence or consulting with China, unilaterally eliminated quotas on 13 categories of textiles and, for the first time, cut five kinds of quotas by 300 percent.

This act of the United States, violating the principles of the bilateral textile trade accord, was opposed by various relevant parties because it has brought substantial loss to not only Chinese firms, but also to U.S. importers, retailers and consumers. It has also seriously affected the Sino-U.S. textile trade.

Although China has demanded the United States to change its decision, the U.S. side did not make a positive response. In return, China temporarily halted the imports of U.S. beverages and agricultural produce effective Nov. 10, 1996.