Chinese cut a deal on textiles

The European Union and China have defused a trade row by agreeing to curb imports of Chinese textiles into Europe until the end of 2008.

EU Trade Commissioner Peter Mandelson welcomed the accord struck at the weekend with Chinese Commerce Minister Bo Xilai in Shanghai. "The overall settlement represents a fair deal for China while giving respite and a much-needed breathing space for European industry."

The accord aims to defuse a trade dispute triggered by the end of global textile quotas on January 1 which opened the floodgates to cheap Chinese goods into Europe.