Bilateral trade ties hurt by row: China<\/p>\n
Agence France-Presse, Beijing<\/p>\n
China warned the United States on Friday bilateral trade will be
\nhurt if import quotas are slapped on textile products, as the
\nU.S. Federal Reserve chief cautioned against "creeping
\nprotectionism".<\/p>\n
U.S. Ambassador Clark Randt was called in by Chinese Vice
\nMinister of Commerce Ma Xiuhong for an emergency meeting on
\nThursday, a day after he was hauled in by Vice Foreign Minister
\nZhou Wenzhong, the Xinhua news agency said.<\/p>\n
Simmering tensions between the trading giants flared this week
\nwhen Washington, under pressure to protect U.S. jobs in sensitive
\nindustries ahead of a presidential election campaign, said it
\nwould cap imports of Chinese bras, knit fabrics and dressing
\ngowns.<\/p>\n
Ma told Randt the U.S. decision would negatively impact China-
\nU.S. trade and harm the United States' domestic interests.<\/p>\n
She said China "hopes the U.S. will fully recognize the
\nnegative impact on normal trade between the two countries caused
\nby abusing safeguard measures on fabric products", and urged
\nWashington to withdraw "its wrong decision".<\/p>\n
As the row rumbled on, U.S. Federal Reserve chairman Alan
\nGreenspan called for action to counter "creeping protectionism"
\nin the United States and elsewhere that threaten the global
\neconomy.<\/p>\n
The influential Federal Reserve chief warned, without
\nspecifically naming the disputes, that protectionism was a threat
\nto the international economic recovery fueled by freer global
\ntrading.<\/p>\n
In a speech at a financial conference in Washington, he said
\nthat "the costs of any new such protectionist initiatives, in the
\ncontext of the wide current account imbalances, could
\nsignificantly erode the flexibility of the global economy".<\/p>\n
"Consequently, it is imperative that creeping protectionism be
\nthwarted and reversed."<\/p>\n
China's Ma said the U.S. decision did not conform to the U.S.
\nCommittee for the Implementation of Textile Agreements's
\nprocedure on special safeguards against Chinese textile products
\nand garments.<\/p>\n
"The U.S. administration's decision to request negotiations
\nregardless of the fact runs against the WTO principles on free
\ntrade, transparency and non-discrimination," Ma said.<\/p>\n
China has warned it could retaliate but has not been specific,
\nalthough it said on Thursday it was studying plans to impose
\nduties on some U.S. manufacturing products.<\/p>\n
The flap comes just weeks before Premier Wen Jiabao arrives in
\nWashington.<\/p>\n
The Financial Times on Friday said he would go equipped with a
\nnew, softer philosophy on trade that Beijing hopes may help
\nreduce tensions.<\/p>\n
Senior Chinese officials were quoted as saying China is now
\nwilling to accept the idea that in future it might run a trade
\ndeficit with the rest of the world.<\/p>\n
This is effect drops a long-standing imperative to boost
\nexports and accumulate foreign reserves through successive trade
\nsurpluses, the newspaper said.<\/p>\n
"I think there could be a trade deficit next year maybe or the
\nyear after," Wang Mengkui, minister at the Development Research
\nCenter of the State Council, China's cabinet, said.<\/p>",
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"sponsor": "Okusi Associates",
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