Updated: 2005-06-07
China's commerce minister has warned against allowing the textile issue between China and the United States to become an "obstacle" to other trade. Bo Xilai illustrated the country's stance over ongoing textile trade frictions to the US public in an interview with the US Public Broadcasting Service, the ministry's website said yesterday.

"The textile issue is exaggerated in the United States," the minister said. "It should not become a major obstacle that blocks Sino-US trade as textile trade only accounts for around 6 per cent of annual trade volume between the two countries."

He said China's textile exports to the United States stood at US$10 billion in 2004, while imports of farm produce from there, which reached US$7.7 billion last year, was enough to just about match the figure. China had also become the largest buyer of cotton and soybean from the United States, he said.

"It is not correct to use a double standard on international trade," Bo said. "The right of textile trade integration was gained after China was granted the right to open its market in other sectors, particularly in farm produce and the service sector."

"How can they (the United States and the European Union) deprive Chinese textile manufacturers of the right and urge us to open the agricultural and service markets at the same time?"

Bo said the surge of textile exports was a predictable consequence of the global removal of quotas among World Trade Organization members, but it might not occur if the developed countries had abolished quotas slowly over the past 10 years.

Since the end of last year, the Chinese Government and textile associations have adopted a series of measures to ease concerns about the textile issue of trade partners, including imposing tariffs on 148 classes of textile products. The government declared a 400 per cent increase on export tariffs on 74 classes from June 1, after finding that the exports of certain categories were still undertaking rapid increases.

"It is a pity that the United States failed to make any positive response," Bo said. "So China scrapped the increased export duties to protect Chinese enterprises from double restrictions."

The minister insisted that the US launch of safeguard measures against Chinese textile products was an abuse of the 242 article of WTO documents because the decision was based on inaccurate statistics over a short period of time.

Bo hoped his point of view could be conveyed to the US people directly and in full.

In his first exclusive interview with foreign media since becoming minister, Bo also mentioned other topics that had aroused concerns.

He said the large trade deficit of the United States first came from differences of calculations between the two countries.

China's customs calculations do not include Hong Kong's imports and exports, a method accepted by the WTO, Bo explained, but the United States put the figures together.

The Chinese Government was also considering how to buy more from the United States, he added.

"US high-end products are facing certain export restrictions on the way to China," he said. "Few low-end commodities are now produced in the United States."

The minister said the United States should not only notice its trade deficit with China but also think of the market share in China.

He said Chinese products took a market share in the United States by exports, while its counterparts went into China's market mainly by investing in China.