China agreed Tuesday to limit its exports of low-cost textiles to the United States, a rare breakthrough at a time when trade disputes are roiling relations between two of the world’s largest trading partners.
The agreement comes not long before President Bush is to leave for a state visit to China, and marks a retreat from free-trade rhetoric for a president who faces political heat over record U.S. trade deficits and their impact on U.S. jobs.
In persuading China to accept quotas on textiles shipped to the United States through 2008, U.S. Trade Representative Robert Portman gave President Bush a major deal at a time when globalization and free trade are coming under increased attack.
President Bush failed to secure a new regional trade agreement at last week’s Summit of the Americas meeting in Argentina, where rioting in the streets and political maneuvering by Brazilian President Luiz Inacio Lula da Silva and other rivals thwarted his efforts.
The new U.S.-China agreement, which allows for U.S. quotas on 34 categories of clothing and textiles beginning Jan. 1, is seen as a step backward by proponents of free trade. Instead of lifting trade barriers, the deal could set the stage for quotas against imports from India, Pakistan, Vietnam and other low-cost textile-producing countries, trade experts said.
