The European Union (EU) issued a warning to China this Tuesday, just two days before a summit in Beijing, over the huge trade imbalance, although it said it preferred “negotiated solutions” to the situation.
“European leaders will not tolerate the trade imbalance in our relations in the long term,” said European Commission President Ursula von der Leyen in an interview with AFP on behalf of European Newsroom, a coalition of several European agencies.
The EU’s enormous trade deficit with China is already almost 400 billion euros (around 433 billion dollars).
“We have tools to protect our market,” the official warned.
According to Von der Leyen, “We are seeing a growing imbalance. This imbalance has doubled in the last two years.”
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However, he added: “We prefer to work on negotiated solutions. These are options that are on the table and I think it is also in China’s interest to carefully analyze these options.”
Von der Leyen and European Council President Charles Michel will be in the Chinese capital on Thursday for the summit. The European Council is the body that represents EU countries, and the Commission is the bloc’s executive body.
This summit in Beijing will be the first meeting of EU leaders with President Xi Jinping and Premier Li Qiang since 2019.
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In addition to the conflicts in Ukraine and the Gaza Strip, trade exchanges are the focus of the talks.
In her statements, Von der Leyen maintained her policy is not to promote a break-off or disruption of exchanges with China, but rather an attempt to eliminate the risks of this relationship.
According to von der Leyen, this meeting in Beijing will be “the summit of options” as the EU has several alternatives in front of it to rebalance trade relations.
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In his view, “the imbalance is so visible” that Chinese exports to the EU are three times more important than sales in the opposite direction.
“In other words, out of three containers that come to Europe from China, two come back empty,” the German official said.
At the high-level meeting in Beijing, von der Leyen said: “We will also investigate the hidden direct or indirect subsidies that favor Chinese companies, as well as the operating rules in the Asian giant’s market.”
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For Von der Leyen, European companies cannot compete on an equal footing in the Chinese market due to the “preferential treatment” given to Chinese companies.
The EU, he assured, defends “fair competition”.
The conversation should also include an examination of the situation with Chinese electric cars, which are being investigated in the EU on suspicion of subsidies that are considered illegal.
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Another sensitive issue on the agenda of the summit in Beijing will be the sanctions that EU countries have imposed on Russia as a result of the war in Ukraine.
In this scenario, various Chinese companies are accused of providing technological support to the Russian war effort in Ukraine.
Efforts to circumvent EU sanctions are “a concern for us (…). We are in intensive dialogue with China and are showing them various cases. We call on China to act in these cases,” he said.
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