25 August 2005 | Anusha Bradley
Clothing buyers may be forced to change suppliers after European quotas for importing garments from China were reached much earlier than planned.
This has resulted in millions of sweaters and trousers being stranded at Europe's borders. The problem follows the signing in June of a memorandum of understanding by the EU trade commissioner, Peter Mandelson, on import limits for hundreds of types of clothing sourced from China.
UK manufacturers had pushed for the agreement, but retailers have claimed the quotas were set too low. Limits for some clothing have been reached just two months into the annual agreement. Imports of blouses, bras, shirts and dresses are also nearing their limit for this year.
Elizabeth Fox, assistant director of the British Clothing Industry Association, told SM: "I don't think anyone realised how much [sourcing and production] is being switched to China. If they had, there would have been more fuss when the quota agreement was made.
"But most know not to put all their eggs in one basket," she said.
Under pressure from retailers, the EU has said it would allow a further 9 per cent of sweaters to be taken from next year's quota, but at the time of going to press, China had yet to agree to this change. The EU Trade Commission was unavailable for comment last week.
The British Retail Consortium said shops were facing a tough autumn and estimated that the stranded sweaters alone were worth more than £30 million.
Sweden-based retailer H&M said it hoped politicians would act swiftly to resolve the problem or it would be forced to destroy stocks. "We are hoping for a political solution. The only alternative is to burn them," a spokesman said. He suggested one option was to redirect production to other low-cost countries in Asia or Europe.
Tesco said some of its garments from China had been blocked, but its diverse global supply base meant the impact would be minimal, while Asda said customers would not notice any difference because it had a number of low-cost sources.