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Hope for textile deal before visits
2005-09-05
China Daily
The United States negotiating team was ready to leave Beijing for home after the fourth round of Sino-US textile trade talks ended in "failure" on Wednesday. But the situation changed at the last minute. Both sides decided to continue the talks yesterday.
It looks as though both sides are determined to work out something substantial, no matter how far apart the dispute over the United States' safeguard measures against China's export of textile products has pushed the two sides.
Obviously both countries hope to create a favourable atmosphere before the nations' heads of state meet next week in Washington when Chinese President Hu Jintao visits the United States.
Whether that was really one of the concerns behind the textile dispute talks or not, it is wise to take a long-term, strategic point of view when attempting to settle any dispute between the world's largest developed and developing countries.
Many political and economic analysts from both China and the United States agree that one of the two countries' common interests is the mutual support of their economies by supplying what each side needs with the other's advantageous resources.
That is also a major concept in the theory of economic globalization and free trade, which the United States and other developed countries have ardently advocated.
It is widely acknowledged that China's textile and apparel products are inexpensive while of high quality. Many attribute the low price to the low cost of Chinese labour.
Low labour costs are definitely one of the reasons, but not the only one. In fact, the main factor in the low production cost is the advancement of China's textile industry in the past decade or so.
Garment factories in China's Yangtze River Delta and Pearl River Delta regions make a quarter of the world's clothing using brand names as well as technology from Western countries.
Advanced technologies and mass production have helped reduce costs. Most factories are owned by investors from developed countries. Therefore, China's garment industry has actually become the world's production base for clothing. This is the result of globalization.
It has benefited consumers all over the world, especially in Western countries. A textile product made in China may sell for US$23 but could be marked up to US$73 if made in Italy. The same product made in another Asian developing country would sell for US$37.
The major reason the United States cited to defend its move to resume the quota regime is the impact cheap Chinese textile products have on US garment makers. China will cause job losses for the US textile industry, some Americans said.
Blocking Chinese garments, however, may not necessarily save American jobs. US textile importers and retailers would simply increase imports from other developing countries. US garment makers cannot meet consumers' demand for cheap, good quality products. A Mrs Nelson from Virginia said limits on imports of Chinese textile products will not change production costs of American-made garments.
Another Virginian, Mr Wood, said that with a long-term perspective, limiting imports of Chinese textile products would lead to downgrading of American products. He said China and the United States each have advantages.
"China exports garments and textile products to the United States and the United States can export products with higher technologies," he said.
These American citizens seem to know better than some of their countrymen in the textile industry about the benefits of economic globalization, and the importance of Sino-US co-operation.
The textile industry is a minor sector in the overall US economy in terms of both employment and structural importance. It is not worthy to protect such a "sunset industry" at the cost of hurting the interests of American consumers, importers, cotton farmers and textile machine manufacturers. China is the largest buyer of American cotton.
The United States is a major initiator of the idea of globalization and free trade. Returning to the stance of protectionism is against its responsibility as a world power.
According to the World Bank, protection of each job in the textile industry in a developed country would cost 35 jobs in a developing country. The United States should give consideration to this fact if it wants to honour its status as the leading force in the global economy.
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