China and the EU met yesterday to revise a two-month-old trade pact that has led to millions of trousers, sweaters and other textiles from China being blocked from the market by EU customs officials.
The June 10 deal, which capped growth in 10 lines of Chinese textile exports at 8 to 12 percent a year, was hailed at the time as a sensible response to a deluge of low-cost clothes from China following the scrapping of global textile quotas on Jan. 1.
But most of the new export ceilings have already been reached, leading to vast quantities of garments piling up in EU warehouses and ports.
Retailers are furious that they cannot take delivery of items such as bras and blouses worth hundreds of millions of euros that they bought for the lucrative Christmas shopping season.
The talks began in Beijing yesterday afternoon and participants agreed to meet again this morning, an EU spokesman said in Beijing.
EU Trade Commissioner Peter Mandelson acknowledged on Wednesday that there was a "serious glitch" in the June agreement and that a pragmatic solution was needed.
Teams of technical negotiators are exploring possible solutions in Beijing.
These include transferring quotas that have not been filled to more popular lines, "borrowing" from next year's quotas or allowing EU importers to bring in goods ordered before the June 10 curbs.
China's Commerce Ministry did not comment on the talks, but the official China Daily said in an editorial that the new round should focus on restoring a more stable environment for textile trade.
"Canceling the quotas is what we hope for most and is also the hope of England, Germany, Sweden, Denmark and Finland, but it will make other countries unhappy, so it's not a possible solution," said Mei Xinyu (梅新育), a leading analyst at China's commerce ministry.
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