US and China negotiators today resume last-minute talks aimed at averting a threatened trade war over textiles. Rita Hayes, the US Trade Representative's chief textile negotiator, yesterday noted 'both sides feel this is the conclusion of the negotiations' following three previous attempts to come to terms on extending a bilateral textile pact. China's Ministry of Foreign Trade and Economic Co-operation (Moftec) has threatened to impose sanctions on selected US imports on Friday unless Washington revokes US$19 million in quota penalties imposed on Chinese textiles in September. Washington invoked the penalties over transshipment of Chinese textiles and clothing through Hong Kong, Mongolia and other countries in violation of a 1994 textile pact, set to expire this week. Moftec has acknowledged transshipments did occur, but insisted mainland exporters were 'purely innocent' of conspiring to bypass trade quotas. Ms Hayes, who earlier vowed the multi-million dollar penalties would 'stand as they are' despite Moftec protests, suggested the two sides were far apart on the issue of transshipments. 'There are still a lot of different issues that we have to conclude,' she said. 'I never like to negotiate in the press, but there are obviously issues the US feels very strongly about.' Moftec repeatedly has threatened to ban imports of US farm products, alcohol and other goods in retaliation to the textile quota penalties, although China has postponed its self-imposed deadline twice before to permit talks to continue. Ms Hayes said US negotiators also would press for greater access to mainland markets under any new textile pact. 'People want to buy US products, just like people in the US like to buy Chinese products,' Ms Hayes said. 'We want it to be a two-way street.' During the previous round of textile talks in Washington late last month, the US side agreed that its Customs would re-examine quota reduction cases and announce the result at the start of the Beijing round. China was the third-largest supplier of textiles and clothing to the US last year, behind Canada and Mexico.