How Peter Mandelson was caught on the hop

When Peter Mandelson was appointed European trade commissioner last August, he stressed his free-market credentials. Yet 12 months later, he is embroiled in one of the biggest rows over free trade to have engulfed the European Union.

As the clock ticked down to the end of agreement on 31 December 2004 that controlled the quantity of clothing British retailers could source cheaply from countries such as China, Mr Mandelson's alarm bells should have been ringing.

He seems to have been surprised, after the disastrous retail Christmas, that imports of good such as jumpers from China to the EU surged by more than 500 per cent and trousers by 400 per cent. By April, Mr Mandelson asked Beijing to curb the flood. He got the Chinese to set a strict limit on exports of 10 "sensitive" categories (those the dwindling European textile industry was churning out in quantity), including dresses, bras and T-shirts.

Yet this was imposed, his critics assert, without consulting the one sector needed to implement it: the retailers.

Retail experts say imposing strict import limits in the middle of the year, when retailers are placing their orders for Christmas is little short of commercial madness. And it takes six weeks to ship items from the country concerned: China.