Chinese textile producers cautiously welcomed the agreement inked Monday night by China and the European Union (EU) to unblock the garments held up at European borders.

"The textile stockpiles had been worrying China's producers. We feel relieved as the problem had been solved. We welcome and support the agreement," said Han Licheng, secretary-general of Zhejiang Provincial Textile Industry Association.

As an important Chinese textile producer and exporter, Zhejiang exported US$5.21 billion worth of yarn and textiles and US$5.84 billion worth of clothes and garment accessories in the first half this year, according to statistics of the Hangzhou City Customs Office.

The stockpiles of large quantities of Chinese textiles at EU customs have brought great pressure on many textile producers in Zhejiang.

"It is senseless for the EU and the United States to block China's textiles export," Han said.

"Though China's textiles and clothes might impact local textile manufacturers, they will bring more profits to local purchasers, retailers and consumers," Han said.

China also argues that since Chinese textile manufacturers buy cotton yarn and clothing from the United States and the EU, the latter profit further.

In the document signed by China's Minister of Commerce Bo Xilai and EU Trade Commissioner Peter Mandelson, China and the EU agreed to share the quota burden caused by the stockpiles.

About half of the 80 million textile products being held up will enter the EU outside the quotas, while the other half will be added to China's 2006 textile limit.

Upon the signing of the agreement, some textile manufacturers expressed their worries about future exports.

"The export quotas for the later half year have almost been used up and if we start using next year's quotas, we will face greater pressure next year," said Zhu Hongjun, a senior manager with Peiluocheng Group in Ningbo, a booming city in Zhejiang.

The agreement might solve the problem for the time being, but China's textile exports will still face more difficulties in the future, said Wu Yiheng, secretary general of the export branch under the Wenzhou Municipal Clothes Association.

"The only way out is to produce value-added clothes. Garment manufacturers should explore new markets to disperse market risks," Wu said.

(Xinhua News Agency September 7, 2005)