Retailers sweat as China quotas cause shortage of jumpers

Peter Mandelson, the European Trade Commissioner, sparked a dispute with retailers yesterday as curbs on Chinese textile imports prompted fears that shops will be left without autumn fashion collections this year.

UK-bound goods from China worth an estimated £30m are stranded in ports and airports after import ceilings were breached, barring the textiles from the EU.

The British Retail Consortium (BRC) accused Brussels of a "complete misjudgement" and said it was too late for many of its members to find alternative suppliers. It predicted that much of the autumn collection "will simply not be on the shelves". There are also fears that consumers face higher prices.

Mr Mandelson blamed the crisis on efforts by retailers to get in under the wire before an agreement curbing Chinese exports came into effect.

After a surge in Chinese textile imports, the EU and China struck a deal on 10 June setting annual import restrictions for 10 categories of Chinese textiles and clothing. But the limits did not come into force until 11 July and, in the intervening weeks, imports rose. That means that goods may not be imported if they were not shipped by 11 July.

Mr Mandelson said: "Chinese and EU traders launched massive shipments of pullovers and trousers to get these goods into Europe under the wire. As a result, in these categories alone, the agreed quotas have been exceeded.

"The Commission has kept importers and retailers informed of developments.... However, the scale of their attempt to beat the restrictions has presented us with immense difficulties."

But Alisdair Gray, the director of the Brussels office of the BRC, insisted there had been "a complete misjudgement by the EU on setting the quota level".

He said officials in Brussels had underestimated "the importance to retailers and consumers of these products from China. They are providing the quality and the price as well as significant choice. There are going to be empty shelves in autumn. When you consider the trading environment in the UK, this is a real problem. A lot of people are going to have to rework their strategy for the rest of the year."

Leading names on the high street are reluctant to speak about the problem for fear of admitting to customers that their ranges will be substandard this year. But industry sources say that all the big chains are affected.

The dispute illustrates the difficulties facing Brussels as it tries to deal with the flood of textile exports from China after the end of a quota system. Southern European nations have pressed for curbs, arguing that the boom in exports threatens to wipe out domestic textile industries. But many European countries have ventures in China, and retailers depend on cheap imports to deliver profits.

EU member states have authorised the Commission to negotiate with the Chinese to try to resolve the problem by using some of next year's allocation.