GENEVA — European Union textiles, apparel and footwear industries should focus on high-end and high-tech production to remain competitive in the face of low-cost imports from China and other Asian countries, European labor ministers said last week.

Francois Biltgen, Luxembourg’s minister of labor, speaking to reporters Friday at the end of a meeting of labor ministers in Geneva from the EU’s 25-member states, said protectionism “will not save jobs.” Biltgen said the EU needs to evolve with developments in the global markets, such as the end of the quota system among World Trade Organization countries. He added that, to counter the competitive challenges from such countries as China and India, Europe should consider moving away from low-end production and to concentrating on technology-intensive, value-added lines.

EU Trade Commissioner Peter Mandelson and China’s Minister of Commerce, Bo Xilai, brokered a deal Friday that limits the growth in Chinese textile and apparel exports to the EU in 10 categories to 8 to 12.5 percent a year in the next three years.

Europe must invest more on research and development “to find new fibers, for example, and to give our industry a new future,” Biltgen said.

“We hope at the next EU summit on June 16-17 to find money for the whole of Europe, which would include money for these industries,” he said.

Noting increased concern that cheap imports from China are resulting in large job losses, Biltgen said European leaders “should not fall back to a protectionist reflex, but tell the truth of the necessity to have wider-open markets in Western Europe.”

A joint EU/International Labor Organization report on “internationalization of employment” points out that technology, at least in the short term, can be a more important driver of job losses, “especially if productivity gains are not followed by a proportional expansion of markets.”

The joint study also estimates the huge U.S. trade deficit with China “corresponds to a gross number of 1.8 million lost jobs,” and the 2003 EU trade deficit with China will amount to around 800,000 jobs lost.

However, Nigerian President Olusegun Obasanjo, in a keynote speech to the ILO’s annual ministerial conference last week, said the effect of declining investment in Africa “can easily be seen in the case of closure of factories and job losses in some African countries engendered by the expiration of the Multi-Fiber Agreement under the terms of the WTO agreement on textiles and clothing.”

This story first appeared in the June 14, 2005 issue of WWD. Subscribe Today.

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