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Gao Hucheng and David Spooner, Chinese and US chief negotiators on textile trade, shook hands Tuesday again in two weeks when they started the fourth round of Sino-US talks on textile trading.
Just on Monday EU trade officials left Beijing for home to report to EU headquarters after talking with their Chinese counterparts trying to find a way out of an awkward situation -- dealing with the millions of items of China-made clothing blocked in the customs of European countries for exceeding import quotas.
It seems China has been haunted by frictions with other trade partners, in particular trade rows on its quality textile products.
The disputes prompt many Chinese business people, manufacturers, retailers and exporters alike, who have just caught up with the trade rules their developed peers have been preaching, to sigh: Where has the spirit of free trade gone? Why are the market forces not allowed to play their due role?
Even foreign observers have acknowledged that China has been abiding by WTO rules well since it entered the World Trade Organization (WTO) more than three years ago. While encouraging domestic enterprises to "go out," it is opening its own market to foreign enterprises strictly in line with its commitments to the WTO, generally regarded as a global family of free trade.
Compared with developed WTO members, China understands better the nature of protectionism: a double-edged sword in world trade if abused.
In June this year, when the EU limited the growth rate to 8 to 12.5 percent for China's export of 10 categories of textile products in the next three years, it meant to protect its own textile industry and workers. But to the surprise of the EU, the two-month-old agreement has backfired at home.
Amid concerns that the quotas may do more economic harm than good, Brussels is now facing growing calls for their relaxation. Retailers say unless the quotas are eased, consumers may end up paying more for clothes hastily sourced from elsewhere. They may also face fewer choices.
Leading EU newspapers have also blamed protectionism for the current textiles trade situation, saying it's unfair to developing countries like China, which should have the right to fair competition with their advantageous industries.
The restriction on China's textile exports has not only damaged China's textile industry, which employs 19 million workers. What should be borne in mind is that in a world of economic globalization, each country has a comparative advantage in producing goods for which it has more sources or higher productivity than other countries. It is difficult to find a final product that comes exclusively from a single country.
Protectionism is a manifestation of fear of "zero-sum" interactions, which don't apply to world trade. One's gain is not necessarily made at the expense of some others' loss. Rather, all parties can benefit, creating a "win-win" game.
Commercial disputes are inevitable in economic and trade exchanges. But different measures bring about different outcomes. When disputes occur, what kind of attitudes should the parties concerned adopt? Consultation instead of confrontation and dialogue instead of unilateral action are the best ways to solve disputes.
Sino-US trade shares the same pattern.
The US needs a better understanding that it benefits a lot through Sino-US trade. America could lose a low-priced supplier base and a vast market if it sours relations with China.
Inexpensive Chinese-made children's wear, for example, helped American parents save US$400 million between 1998 and 2003, according to a Morgan Stanley survey.
In fact, for every item of Chinese textiles exported to the US, more than 80 percent of the profit goes to US businesses, while Chinese factories and workers have to live on limited earnings.
On the other hand, China has emerged as one of the world's biggest consumption markets, and a major contributor to world economic growth in recent years. More important, the Chinese government is willing to maintain a balanced relationship with all its trade partners, as has been evidenced by its recent revaluation of the yuan, a move demonstrating courage and wisdom.
It should also be noted that China and western countries are at different stages of development, and so are the goods they sell. The huge amount of textile products is not that terrifying if you've heard of the comparison made by Chinese Minister of Commerce Bo Xilai: China has to sell 800 million shirts to buy a Boeing or an Airbus airliner.
(Xinhua News Agency August 31, 2005)
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