The surprise withdrawal of all Chinese export tariffs on textiles, just a day or so after dramatic increases were announced, suggests that the Chinese are now negotiating with themselves I “thought”:http://www.inquit.com/article/429/us-and-eu-quotas-to-force-up-world-clothing-price the Chinese move was clever, and no more cynical than the policy of the U.S. and E.U. on garment imports. But … bq. “The government revoked the bulk of tariffs imposed on Jan. 1 and increases to those taxes announced on May 20, the Ministry of Finance said in a statement today. The ministry didn’t say why it removed the tariffs, which were imposed to control the industry after an end to global textiles quotas on Jan. 1. “This is a strong gesture from China to the U.S. and EU,” said Long Guoqiang, a senior trade researcher at the State Council Development and Research Center in Beijing.”(“Bloomberg.com(link to this excerpt)”:http://www.bloomberg.com/apps/news?pid=10000103&sid=aelKOpgNgUEQ&refer=us) But this looks like the sort of indecision brought about by internal confusion about whose hand holds which levers … and jerky knees. There’s “apparently”:http://www.forbes.com/business/feeds/afx/2005/06/01/afx2068023.html been some sort of confirmation of this in a China Daily editorial that acknowledges that ‘unilateral action’ (China’s?) is ‘not constructive’. There’s every reason to think we’ve seen only the opening moves in this game.
Peter Gallagher is a leading Australian consultant on trade and public policy.[bio].
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