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17.3.3.  Textiles and clothing industries in the EU

    The textiles and clothing industries experienced difficulties from as early as the late 1960s, as a result in particular of the slow growth of domestic demand and the rapid development of exports from the developing countries. In fact those industries, in common with all industries which need neither high technology nor capitalist concentration, lose their competitive advantage in Europe to industries from countries which have a relatively cheap workforce. In addition, the European textile industry with some 2.3 million employees in the late 1990s was facing unfair trade conditions due to fraudulent imports and insurmountable tariff and non-tariff barriers in some third countries. The European Social Fund was able to help those who lost their jobs in the textiles and clothing sectors, but such assistance was no more than temporary relief pending a genuine European textile policy. Set in motion in the early 1990s this policy has two defensive wings: an internal wing and an external wing.

    On the internal level, the Commission monitors national aids and applies a policy aiming at preventing such aids from giving rise to distortions of competition within the European Union or having the effect of transferring labour problems and structural difficulties from one country to another [Commission communication, see section 15.5.3].

    The external aspect of the common textiles policy aims at organising international trade in textiles in order to provide breathing space for the European industry without frustrating the industrialisation hopes of the developing countries. Such organisation was sought within the framework of the General Agreement on Tariffs and Trade (GATT) through the arrangement on international trade in textiles, commonly known as the "Multifibre Arrangement" (MFA). However, the agreement on textiles and clothing, concluded within the framework of the Uruguay Round aims at the progressive liberalisation of textile and clothing products within the World Trade Organisation [see section 23.5].

    In view of the elimination of import quotas on 1 January 2005, the Commission put forward a series of initiatives to stimulate research and innovation, guarantee lifelong education and vocational training, reserve a Structural Fund annual contribution to cover unforeseen local or sectoral crises linked to economic and social restructuring, provide appropriate tools to combat counterfeiting and piracy, improve access to markets outside the EU, encourage agreements between all pan-Euro-Mediterranean partners, and strengthen cooperation with China [COM/2004/668].

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