While the president of the European
Commission, Ursula von der Leyen, stressed that EU states would
prefer negotiations to a trade war she left an implied threat of
protectionist measures on the table.
"We have tools to protect our market," von der Leyen told an AFP
reporter who conducted the interview on behalf of the European
Newsroom, adding that "we prefer to have negotiated solutions".
Von der Leyen, top EU diplomat Josep Borrell and Charles Michel,
the president of the European Council, will be in Beijing on
Thursday and meet Chinese President Xi Jinping and Premier Li
Quiang. The summit marks the first in-person EU-China summit
since 2019.
The commission president cited a lack of access for European
companies to the Chinese market and preferential treatment of
Chinese companies through subsidies as specific problems for the
EU. According to von der Leyen, this is part of the reason why
the trade imbalance has doubled to almost 400 billion Euro in
the last two years.
She further said that it was important to see China not only as
a trading partner "but also as a technological competitor, a
military power, and as a global actor that has distinct and
divergent views on the global order".
China has changed and, after a phase of opening and reform, is
now pursuing a policy in which security and control are central,
according to von der Leyen.
A "summit of choices"
Stressing that both sides would have to decide whether they are
prepared to make concessions to preserve the relationship, she
dubbed the talks a "summit of choices". The commission president
said that Europe was not trying to "de-couple" itself from the
Chinese powerhouse, but rather to "de-risk" ties that had become
too one-sided.
While the European market has proved a lucrative draw for
Chinese investment and exports, EU firms have not enjoyed open
access to China's growing consumer middle class.
Chinese state aid to its companies and their preferential
treatment in terms of market access are also causing
displeasure. "For every three containers that go from China to
Europe, two containers return empty," said the commission
president, visualising the imbalance.
Strong overproduction in China is leading to dumping prices.
Domestic demand in the country itself is low due to weak
economic growth. In addition, some other countries are closing
their markets to Chinese products, which means that the products
end up in Europe, emphasised von der Leyen.
The EU side is also "looking at the question of hidden and
direct and indirect subsidies to Chinese companies in
competition to the European companies", according to the
commission president.
The commission is currently carrying out an investigation into
potentially competition-distorting subsidies for electric
vehicles coming from China, fearing subsidised imports could
stifle EU innovation in a huge new sector.
"We have learned our lessons from the solar panels," von der
Leyen said, citing a green tech sector now dominated by Chinese
firms amidst a global rush to decarbonise energy production.
Concerns about possible Chinese retaliation
Separately, a senior European official speaking on condition of
anonymity, laid out Brussels' trade concerns in more detail -
along with concerns about Chinese retaliation.
"We've seen retaliation by the Chinese before. It's usually not
symmetric. So it doesn't necessarily hit exactly the same
sectors," the official said.
The EU official noted that Europe is entering an election cycle
in the run-up to next year's European Parliamentary elections,
and that relations with China could come under political
pressure. "The Chinese side is very well aware of this," he
said.
"My feeling is they're fully aware of the overcapacity and the
effect it has around the world, not just on us, but we're seeing
basically a domino effect as other major economies are closing
their market."
The United States - firstly under former president Donald Trump
and continuing under President Joe Biden - has taken a tougher
line on China.
Besides trade: Russia, Sanctions and the Climate
Europe, von der Leyen said, will take its own route but shares
many of Washington's concerns, including the one about China's
support for Russia despite Moscow's war against Ukraine.
The commission president further stated that the EU wants to
persuade China to use its influence on Russia, calling on the
government in Beijing to take action against Chinese companies
involved in circumventing the sanctions.
While von der Leyen highlighted China's efforts in the area of
biodiversity and the reduction of methane gas as positive, she
also warned that China's attitude at the COP28 summit in Dubai
was under scrutiny. The West is anxious that the Asian giant
pull its weight in reducing greenhouse gas emissions. China is
responsible for 20 percent of global greenhouse gas emissions.
However, the issue of compensation payments for climate damage
is likely to be a sticking point at the COP, as a senior EU
official noted. China sees itself as a developing country and
does not want to pay into the relevant funds as Western players
such as the EU and the USA are demanding.
Von der Leyen also intends to raise the case of European
parliamentarians sanctioned by Beijing. "I have always
considered these sanctions to be unjustified," she said.
French MEP Raphaël Glucksmann and Germany's Reinhard Bütikofer,
president of the European Parliament's delegation for relations
with China, were sanctioned by Beijing in 2021 for denouncing
Chinese repression against the Muslim Uyghur minority.
(The content of this article is based on news by agencies
participating in the enr)
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