China has placed new tariffs on its textile exports in an attempt to ease concerns of the United States, which has been increasing pressure on the country.
The move comes after the United States set limits on its clothing imports from China. The European Union has also increased pressure on China. The U.S. Treasury elected a special envoy to China yesterday to further increase pressure.
Textile exporters in China will now pay a tax of as much as 4 yuan (48 cents) for every item. This is five times higher than taxes were before. The taxes will be placed on 74 product types beginning June 1. Bloomberg News reports:
Textiles exporters including Orient International (Holding) Co. said the tariffs may not be enough to stop the U.S. and EU restrictions, less than five months after a four-decade-old system of global textile quotas ended. China’s textiles and clothing exports surged 29 percent in the first quarter, aggravating trade tensions with the U.S., which reported a record $162 billion trade deficit with China last year.
The higher levies probably won’t erode the price advantage of Chinese clothing. A cotton leisure suit from China costs a buyer at least $20, said Liu Qiong, owner of Shanghai Hejing Textile Co., which sells apparel to U.S. retailers. The 1 yuan, or 12 U.S.- cent, tariff is equal to a 0.6 percent tax, she said. Retailers may mark up the price by 50 percent, she said.
“China is a responsible country, and it is for the purpose of helping establish a new world textile trade order and ease the trade friction that the government made the concession,” said China Textile Industry Council spokesman Sun Huaibin.
The other day, the U.S. treasury gave China a six-month deadline to revalue its currency. China rejected this and said that it could not achieve this in a fixed timeframe.
Chris is a staff writer for Murdok. Visit Murdok for the latest ebusiness news.
