EU, China Voice Trade Objections Ahead of Summit
Ahead of an EU-China summit later this month, officials from both sides criticized the other’s trade practices and warned that conditions need to improve if they plan to work together on market access, economic security measures and other trade issues.
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European Commission President Ursula von der Leyen, speaking to the European Parliament this week, said the bloc is continuing to focus on building out its trade defense toolkit to combat unfair Chinese trade practices, including subsidies that “choke” international competition.
China presents a “real challenge for Europe to confront, and we have started to address these challenges,” she said, “whether derisking our economy and industry using our new toolbox for trade defense measures, or diversifying our supply chains and sectors where China holds dependencies, if not outright monopolies.” Von der Leyen added that China is “running the largest trade surplus in the history of mankind,” and EU products “are systematically discriminated in public procurement” in China.
“This is simply not fair. The system is explicitly rigged. So we have taken action to rebalance the public procurement market for medical devices,” she said, referencing the EU’s decision last month to exclude Chinese companies from certain EU government purchases of medical devices (see 2506200015).
While the EU “remains fundamentally open,” most of its companies “are rapidly losing market share in China,” von der Leyen said. “We want to see tangible progress on our long-standing requests for market access,” including when EU and Chinese officials meet for their summit July 24-25.
There are opportunities for the EU and China to work together on shared trade and environmental issues, von der Leyen said, but not before China stops its unfair trade practices.
“Let me be clear. If our partnership is to move forward, we need a genuine rebalancing, fewer market distortions, less overcapacity exported from China, and fair reciprocal access for European business in China.”
A Chinese Ministry of Commerce spokesperson objected to von der Leyen’s comments, saying during a July 10 regular press conference that they “do not truly reflect the current state of China-EU economic and trade relations, nor do they reflect the positive progress made in the dialogue and communication between the economic and trade authorities of the two sides.”
The spokesperson specifically disputed von der Leyen’s accusations that China hasn’t opened its market enough to EU companies, saying Beijing has “completely abolished restrictions on foreign investment access in the manufacturing sector, and has taken the initiative to expand imports from Europe through platforms such as the China International Import Expo, bringing more market opportunities to EU companies.”
Meanwhile, the EU has been “practicing protectionism in the name of fair trade” and frequently investigating Chinese companies, the spokesperson said, according to an unofficial translation. “The degree of market openness has been continuously regressing, and the business environment has continued to deteriorate.”
The spokesperson also stressed that China’s export controls over rare earths “are prudent and appropriate, and the items included in export controls are far fewer than those of the EU.” It has also set up a "green channel" for European companies to speed up approvals of purchases of Chinese rare earths.
“Instead of appreciating China's efforts, the EU has made unwarranted accusations against China,” the spokesperson said. “What's more, the EU's high-tech export control approval is slow and the procedures are cumbersome, which seriously affects the stability of the China-EU production and supply chain.”