BEIJING, Aug 25: The European Union and China opened talks here on Thursday to resolve a trade dispute that has left millions of items of Chinese-made clothes blocked by European customs officials for being above import quotas.

The two teams were to meet again from early Friday in a bid to get nearer a solution, an EU spokesman said.

With retailers across Europe angry over the quotas and anxious to fill their shelves for the winter season, the EU has been under pressure to review the import limits, which were agreed with Beijing just two months ago.

According to the French trade ministry, 48 million sweaters, 17 million pairs of trousers, some 500,000 blouses, 1.6 million T-shirts, 3.4 million bras and 1,470 tons of flax yarn are being held up.

Negotiators “are basically trying to discuss strategies on dealing with the situation of blocked goods in Europe,” an EU delegation spokesman told AFP.

The EU’s executive commission described the talks as “constructive and friendly”.

“For the moment the discussions are continuing,” commission spokeswoman Amelia Torres told journalists in Brussels.

“The atmosphere of the discussions with our Chinese colleagues is, as could be expected, constructive and friendly, given that of course it’s in the interest of the two sides to resolve this problem as quickly as possible,” she added.

Chinese exports have surged since a global textile quota system was abolished on January 1 as part of World Trade Organization efforts to liberalize international trade.

The surge prompted the EU and the United States to re-implement quotas provisionally on Chinese textiles in an effort to protect domestic manufacturers.

Although the June agreement limited annual growth in selected exports, a division has emerged between European textile-producing states, such as France, Italy and Portugal, and other nations that have eagerly snapped up the cheap Chinese goods.

Meanwhile, the quotas have also left China complaining about the EU and US attempts to limit free trade in textiles, while calling on developing nations to open up to greater trade liberalization in ongoing World Trade Organization talks.

“Over the recent period, Chinese textile products have been stockpiled at the customs departments of EU nations, normal trade channels have been blocked,” Sun Huaibin, an official at the China Wool Textile Association, told AFP.

“This is not only creating losses for the producers, but it is also creating losses for European importers and retailers.”

James Huang of the Ningbo Silk Trend Garment Group said: “If the EU does not abolish the quotas, a lot of small Chinese textile producers will face bankruptcy by the end of the year and the people who will suffer the most will be textile workers.”

So far seven out of 10 textile categories covered by the import restrictions have hit their limits as retailers rushed to fill orders before the annual quotas limits were reached.

In accordance with normal trade practices, credit guarantees would have already been issued by buyers before the shipping.

This means European retailers could be facing hundreds of millions of dollars in losses not only for the goods, but additional shipping and storage costs, industry sources said.—AFP