The Minister of Commerce called for the EU not to exaggerate the textile issue in his meeting with its Trade Commissioner Peter Mandelson in Paris on Thursday, said ministry sources on Saturday.

In their meeting, Bo Xilai said limitations on Chinese textile products not only harm China's interests but also those of EU importers, retailers and consumers.

Mandelson said the EU attaches great importance to trade with China, which has seen rapid growth in recent years and is vital to both sides.

Some EU member states have expressed concern over a surge in Chinese textile imports, he said, adding that the EU would take quick action to slow them down.

But Bo said, "The increase in some categories of textile products does not disrupt importing countries' markets."

He added that China is a responsible country and has taken a series of measures to control exports. The rate of increase began to drop in March, and would continue to decrease in the next few months, he maintained.

Bo said China and the EU will celebrate the 30th anniversary of relations on May 8. Last year, bilateral trade volume reached US$177.3 billion as the EU surpassed the US to become China's biggest trade partner, both overall and specifically in high technology.

In the past ten years, China imported US$330 billion worth of EU products, Bo said, adding that it is expected to import US$1 trillion worth in the next ten years.

He said textiles only account for 7.1 percent of bilateral trade, and that China's and the EU's sectors are compatible, with China also importing EU textile materials.

Bo and Mandelson agreed to enhance consultation on the textile issue and find the best way to settle it. 

According to the Ministry of Commerce, China's total textile exports grew steadily in the first quarter of 2005, reaching US$22.4 billion worth. This was a year-on-year increase of 19.1 percent, but the growth rate was down 5.6 percent. The export of textile yarn, fabric and products grew 24.8 percent and that of clothes 15.9 percent. The rate of growth for all products was lower than in first quarter 2004.

However, China's 38 major state-owned textile enterprises saw profits drop by nearly 40 percent in the first quarter of this year, said the State Council's Commission for Supervision and Management of State-owned Properties on Thursday.

In the first three months, 38 major enterprises reported an income of 15.98 billion yuan (US$1.9 billion) in major businesses, an increase of 0.5 percent, and costs of 13.96 billion yuan (US$1.7 billion), 2.7 percent higher than last quarter.

With an export volume worth 2.73 billion yuan (US$329.7 million), or 20.5 percent higher than last year, the same enterprises saw profits of 290 million yuan (US$35 million), down 38.6 percent.

(Xinhua News Agency May 8, 2005)