TOH HAN SHIH

The United States government is to release millions of dollars of embargoed Chinese garments on to the market in time for Christmas and will not impose additional quotas on Chinese textiles despite pressure from the US industry.

As part of a continuing thaw in Sino-US relations, the US government body responsible for quotas on Chinese textiles, the Committee for the Implementation of Textile Agreements (Cita), would not impose additional safeguard quotas on 24 categories of Chinese textiles which the US industry requested, said Franklin Lavin, the undersecretary of commerce for international trade.

"On November 8, Trade Representative Rob Portman and Minister of Commerce Bo Xilai announced a broad agreement on textile trade. Based on these considerations, Cita has ended consideration of textile safeguard petitions," Mr Lavin said.

The Sino-US agreement allows the US to impose safeguard quotas on textile products not covered by the treaty, but the US said in the agreement it would exercise restraint in this option.

Between November last year and October, the US industry petitioned its government to impose safeguard quotas on 24 categories of Chinese textiles, including some covered by the Sino-US agreement, which imposes quotas on 34 Chinese textile categories from 2006 until 2008.

However, several items petitioned by US industry, including women's blouses, pyjamas and dressing gowns, are not covered by the agreement.

"It's a good sign that Sino-US relations are better after [President] Hu Jintao and [President] George Bush got together [in Beijing last week]," said Douglas Sheridan, the owner of BKMS Trading.

Mr Sheridan said the US decision not to impose further quotas on Chinese textiles was understood to be related to broader Sino-US trade relations, including a sale to China of US$4 billion of Boeing jets announced during Mr Bush's visit to Beijing on November 19.

"Let's be honest, there's a link between Boeings and bras," he said.

Peter Liu Sin-shing, chairman of the textile and apparel committee of the American Chamber of Commerce in Hong Kong, said: "The two governments are honouring the spirit of the agreement for predictable, transparent and fair trade between both countries. Now we in the industry can plan our business."

Samuel Choi Lin-hung, an executive director of textile firm Victory City International Holdings, said the industry would experience uncertainty if the US continued to impose safeguard quotas on Chinese textiles since their timing and terms were hard to predict.

On Monday, US customs will release all Chinese garments that were embargoed for exceeding quota, except socks.

Based on US Department of Commerce data, an estimated US$100 million worth of garments will be released.