EU and China agree textile pact

The European Union and China have agreed a deal to limit exports of Chinese textiles into Europe after last-ditch talks to calm a trade row. EU Trade Commissioner Peter Mandelson said the curbs would give European firms time to adjust to China's growing power in the textile trade. The measures will come into force immediately and last till 2008. The EU was set to impose its own curbs if no deal was reached on Friday, as trade rules allow protection till 2008. Mr. Mandelson said "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".