EU foreign ministers failed on Wednesday to agree on a proposed new system of preferential trade duties for developing nations because of a row prompted by fears of surging Asian textile and clothing imports. "Textiles was the main blockage," European Trade Commissioner Peter Mandelson told reporters after inconclusive talks on reforming the Generalised System of Preferences (GSP). Diplomats said Italy, which once boasted a thriving apparel industry, led a handful of states demanding that the threshold for countries to qualify for low tariffs be lowered to 10 percent of total EU imports in the sector. That would exclude India, which accounts for 11 percent. They were opposed by an equal number of states that want to set the threshold at 15 percent -- the proposed new level for all other products -- which would keep India in. If there is no agreement on a new GSP system, proposed last year to ensure that the world's poorest nations benefit most, the old regime would remain in force. That would include China, which is any case expected to benefit most from the Jan. 1 abolition of an international quota system for trade in textiles and clothing. "It is ironic that those member states principally concerned about the growth of Chinese textile exports and their impact on domestic industry are blocking an important measure that would address precisely this concern. Not acting today is detrimental to EU textile industries and I regret this," Mandelson said.
