US and China conclude third round of textile talks with no agreement

WASHINGTON -- The United States and China have failed to reach agreement on a deal to limit a flood of Chinese clothing and textile imports coming into the United States. Negotiators said Thursday that the talks would resume next month.

The U.S. side said progress in narrowing the differences had been made in this week's talks which lasted from Monday through Wednesday night, a day on longer than had been scheduled. But David Spooner, the administration's chief textile negotiator, said the United States was still prepared to end the discussions without an agreement.

"The United States will have no hesitation in walking away from a bad deal," Spooner said in a statement.

He said both sides planned to meet again in October but that an exact time and location had not yet been set. The first round of the discussions took place in August in San Francisco followed by a round of talks in Beijing and then this week's discussions.

"Our preference is to seek a longer-term solution that will permit the orderly development of textile and apparel trade," Spooner said.

He said in the discussions this week the two sides had made progress "particularly with regard to product coverage and quota levels."

The talks are aimed at limiting Chinese clothing and textile imports which have been flooding into the country after global quotas were lifted last January. The industry has won rulings from the administration to impose limits, known as safeguards, in various categories of clothing but would prefer a comprehensive deal covering all categories of clothing where production has been disrupted by the surge in Chinese products.

American retailers have reluctantly gone along with the idea of a comprehensive deal as long as it will allow for greater growth in imports than the 7.5 percent cap imposed under the safeguard process.

U.S. retailers complain that many product categories where safeguards have been imposed have already hit their limits for this year, forcing the retailers to look elsewhere for supplies with time growing short before the holiday sales season begins.

The U.S. industry contends that thousands of jobs have been lost and 31 textile plants have been forced to close just this year because of the sharp increase in Chinese shipments.

The administration is under pressure to deal with an American deficit with China that last year hit an all-time high of $162 billion and is on track to be 30 percent higher this year.