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Friday, August 25, 2006

 

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''Chinese Textiles: Quotas Not a Solution''

Kansas City Star, 11/28/05

A recent pact with China restricting clothing imports for three years is a testament to the power of the U.S. textile lobby. Other industries have tried to dilute the competitive threat from China, but few have succeeded.

Textile quotas, however, may prove a mixed blessing for their supporters. The deal signed earlier this month in London restricts the growth of Chinese imports in 34 categories. That should provide some breathing space for U.S. producers, but it's likely to be temporary.

Some Chinese producers already are saying they plan to move into higher-end products. More T-shirt production, for example, will move to Bangladesh, while Chinese companies go into dressier, more-profitable garments.

If so, then the result will mirror the 1980s, when quotas on Japanese cars undercut the competitiveness of Detroit by encouraging Honda and Toyota to enter the luxury-car market. Quotas only made the Japanese challenge more powerful.

For consumers, import quotas reduce choices and keep prices higher than they would be otherwise. Even if most consumers don't notice much of a change, quotas will deny them the bargains that would have been available.

Implementing import quotas is no solution to an industry's long-term problems. But in this case, producers should have thought more carefully about what they wished for.

Go back, or read the latest opinions:

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