WRITTEN QUESTION E-2758/99

by Concepció Ferrer (PPE-DE) to the Commission

(18 January 2000)

Subject: China's accession to the WTO

A bilateral agreement was recently reached between the United States and China on the conditions for China's accession to the WTO. In view of the impact which that agreement may have on the European textile and garment sectors, bearing in mind that China is the leading exporter of garments and the second largest exporter of textiles, can the Commission make an assessment of the agreement's impact on the European textile, garment and leather sectors?

What approach will the Commission take to bilateral negotiations between the European Union and China with a view to that country's accession to the WTO with regard to the above sectors?

Answer given by Mr Lamy on behalf of the Commission

(9 February 2000)

The agreement reached between the United States and China concerning the latter's accession to the World trade organisation (WTO) reflects the bilateral position of the two parties. The final terms and conditions of China's accession will be determined within the WTO, notably in the working party on the protocol of accession of China.

The Commission's understanding of the United States/China agreement in so far as it relates to the textiles and clothing sector is that the United States has accorded China the benefits of the WTO agreement on textiles and clothing (ATC) from the date of accession, including the end date of 1 January 2005 for integration of all products covered by the ATC. In addition, the United States/China agreement proposes that for a further period of four years from 1 January 2005 a special safeguard provision will be available to the United States and other WTO members in respect of imports of textiles and clothing from China. This safeguard clause closely follows the safeguard provision of the currently applicable United States/China bilateral textiles agreement.

Broadly speaking, the Commission welcomes agreement between the United States and China as a major step forward to China's accession to the WTO. However, the agreement deals with China's accession to the WTO from a United States perspective and does not cover all the priorities of the Community. There remain areas concerning China's accession to the WTO which need to be resolved between China and the Community in further bilateral negotiations.

For textiles and clothing China is the largest supplier of the Community subject to quantitative restrictions, with imports from China running at around 7 000 million per year. The application of the ATC to China would bring increased competition not only for European industry but also between exporters of textiles and clothing to the Community particularly in lower price ranges. China is also a very large potential market for textile and clothing industry. Exports from the Community to China, however, are in the region of 300 million per year. A major factor in this low performance is the lack of openness of the Chinese market.

Therefore the main approach of the Community for the sector will be to ensure that China's accession to the WTO provides a balanced result in particular by way of a substantial increase in market access opportunities for Community exports in the sector.