Before repealing textile and clothing quotas in 2005, many economists speculated that some landlocked countries, especially those near China, would face many new difficulties. On May 25, the UN released results studying the past year, since the quotas were lifted.

Mongolia has been among the hardest-hit countries since the end of textile and clothing quotas in early 2005, with the value and volume of Mongolian textile and clothing exports to virtually its only customer, the United States, plummeting by 41 percent and 30 percent respectively

U.S. imports of Mongolian ready-made garments dropped from US$229 million to US$135 million. At the same time, U.S. imports of knitted cashmere jerseys and pullovers – traditionally one of Mongolia’s best-known products – plunged more than 90 percent. More than half of Mongolia’s foreign exchange generated from cashmere-related trade consists of exports of raw cashmere to China, and re-importing it to produce final products, since Mongolia lacks a cashmere processing sector.

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