As Memorandum of Understanding enters into force, EU and Chinese statistics reveal rapid fill rates in certain categories

The European Union has put into force the Memorandum of Understanding that follows negotiations between Beijing and Brussels over textile quotas agreed recently by the two parties. In essence, this involves a system of "double checking" with the introduction of EU import licences for restricted Chinese imports. Counting on both sides already reveal that agreed quota limits are significantly filled in some categories.

The now famous "paragraph 242" of China''a accession to the WTO, recently formed the building blocks of a successful negotiation between the EU and China on limiting, over the next three years, ten categories of clothing and textile.

The EU has now implemented the Textiles Memorandum of Understanding with China (MoU). This seeks to put into effect a system whereby, and as agreed with China, a system of "double checking" will be introduced (see our recent FAQ).

From the 20 July, China will count issue export licences to producers wishing to ship restricted textile products to the EU.

Several categories nearly exhausted

China has already started counting shipments of these restricted categories.

Tables below compare the shipments from China and the products already counted in EU ports on arrival.

Chinese figures confirm that in categories 5 (pullovers) and 115 (flax yarns), a significant amount of quota limit has already been used up. With around 60% already filled, the exhaustion dates for these categories could be achieved as early as the end of July.

Other categories are also showing signs of premature exhaustion.

Category 4 (knit shirts) has exhausted 40% of its quota and should see complete exhaustion towards the end of August. The same pattern applies to categories 20 (bed linen) and 39 (table linen) with 46% and 38% respectively also due to be exhausted next month.

With a three week time separation between shipment date and arrival in the EU, European figures still show that the same categories have already made a large impact on quota exhaustion.

EmergingTextiles.com