European Trade Commissioner Peter Mandelson, in Shanghai for last-minute talks with China over its surging textile exports, warned on Friday that the European Union would take action if no deal was reached. China has until Saturday to agree to curb the rise in exports of T-shirts and flax yarn to the European Union to 7.5 percent compared with the previous year, or face the imposition of temporary quotas on these products within days, according to Reuters. The United States has already slapped caps on seven textile products, provoking an angry reaction from Beijing. "We hope to achieve an agreement with the Chinese government about what we are going to do about the textiles explosion which is affecting Europe and so many developing countries," Mandelson told reporters after arriving in Shanghai. "If we don't make an agreement we will have to take other measures," he said without elaborating. "This question has been dragged on over many days. We have a limited opportunity." Mandelson is expected to have lunch with Chinese Commerce Minister Bo Xilai and then hold talks in the afternoon, an EU diplomat said. Talks would continue on Saturday if no agreement was reached on Friday, the diplomat said. --More 1002 Local Time 0702 GMT