A Japanese government probe that began in April 2001 shows that the volume of Chinese towel imports to Japan grew only 7 to 8 percent annually, insufficient to warrant safeguard tariffs, the Ministry of Trade and Industry (MITI) announced.

"We want to protect our domestic industry, but we have to play by the international rules," Trade Minister Shoichi Nakagawa said, referring to the regulations set by the World Trade Organization.

A growth rate of at least 10 percent is necessary to impose safeguard tariffs.

An industry association of Japanese towel makers asked the ministry in February 2001 to impose special tariffs to stop surging towel imports, especially from China and Vietnam, which they claimed were hurting domestic producers.

MITI, however, said that foreign-made towels had stopped flooding into Japan.

It attempted to drop the investigation into Chinese towel imports in 2002 owing to insufficient evidence, but the huge amount of political pressure being exerted kept the inquiry open.

MITI has extended the investigation five times since October 2001, each time for six months.

Cao Xinyu, deputy director of the China Chamber of Commerce for Textile Import and Export, said the Japanese textile industry should not rely on a temporary government policy but seek a lasting solution.

"Why don't our Japanese counterparts use their advanced technology to develop high-tech textile products instead of fearing China's products?" Cao asked.

Japan has tried many times to block Chinese imports, in particular farm produce, although Japan is usually the biggest winner in bilateral trade.

Japan recorded a US$5.0 billion bilateral trade surplus with China in 2002 and a US$15 billion surplus last year.

(China Daily April 5, 2004)