US official claims 25pc HK, Macau clothes exports may be illegal sales

A senior United States official claims up to 25 per cent of garments exported from Hong Kong and Macau to the US market may be illegally transshipped by the mainland.

Under-Secretary of Commerce for International Trade David Aaron said 20 per cent to 25 per cent of textiles bearing Hong Kong or Macau labels might actually come from the mainland.

At a House of Representatives Commerce sub-committee hearing on mainland trade issues, Mr Aaron had harsh words for Macau, saying the law and order situation was deteriorating so much in the enclave prior to the handover that 'it is on the verge of becoming an outlaw economy'.

'I think we have to have much more serious discussions with our Portuguese allies about maintaining some control of that area in the transition period,' he said.

Turning to the SAR, Mr Aaron said: 'Quite frankly, while our relationship on the whole with Hong Kong is good, on [transshipment] it is not satisfactory.

'They have taken the position that we cannot conduct inspections - or to put it another way, we can only accompany their inspections.

'That's not satisfactory for us,' Mr Aaron said, adding the US was about to send a customs team to Hong Kong to pursue the issue.