The European Union and China clinched a deal on Friday limiting the rise in Chinese exports of textiles and clothing to the EU until the end of 2008, averting the imposition of quotas that could have soured ties, Reuters reported. "The overall settlement offers a fair deal for China while giving respite and much-needed breathing space to textiles industries in Europe and developing countries," EU Trade Commissioner Peter Mandelson said in a statement. The agreement was reached in Shanghai by Mandelson and Chinese Commerce Minister Bo Xilai after months of tension over an explosive rise in shipments of cheap exports from China. The rise, which has generated fears for the future of the garment industry and millions of jobs in Europe and the United States, was unleashed by the Jan. 1 abolition of a decades-old global system of quotas. Resorting to terms agreed when China joined the World Trade Organisation (WTO) in 2001, the United States has already slapped temporary restrictions on seven garment and textile products, provoking an angry reaction from Beijing. --More 2344 Local Time 2044 GMT
