NEW YORK — Importers are bracing for a major surge of deflationary pressure in 2005,

when many executives expect the abolition of the quota system to drive down apparel prices by 15 percent

or more. Increased competition and the elimination of quota charges are the primary reasons

that the price cuts are expected, though there is substantial disagreement of how much the price declines

will be and how quickly they will take effect. Given the pinched margins along the apparel supply chain, some vendors and retailers are expressing hopes that some of the cost cuts will mean fatter profits.

However, with mass marketers and Chinese manufacturers, including those in Shanghai, shown here, relying heavily on price competition, there is great skepticism about that possibility.

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