Valdis Dombrovskis, Executive Vice-President of the European Commission, speaks at the Bund Summit in Shanghai, China September 23, 2023. Portal/Jason Xue LICENSE RIGHTS
BEIJING, Sept 25 (Portal) – The European Union has no intention of cutting ties with China even as the bloc takes steps to reduce economic dependencies and reduce risks, but China “could do a lot” to do so contribute to reducing risk perception. the EU trade chief said on Monday.
The EU has long complained about the lack of a level playing field in China and the politicization of the business environment. Concern turned to caution after Beijing’s attempt to strengthen ties with Moscow despite the war in Ukraine.
Europe’s economic ties with China are close, but China “could do a lot to reduce our risk perception,” Trade Commissioner Valdis Dombrovskis said in a speech at Tsinghua University in Beijing.
China has also unveiled new laws this year, including a foreign relations law that warns against “actions” detrimental to China’s national interests and an anti-espionage law that prohibits the sharing of information related to national security bans that it does not specify, increasing compliance risks for foreign companies.
“Their ambiguity leaves too much room for interpretation,” Dombrovskis said.
“This means that European companies are struggling to understand their compliance obligations: a factor that significantly reduces business confidence and discourages new investment in China.”
Dombrovskis is expected to raise his concerns with Chinese Vice Premier He Lifeng at a high-level economic and trade dialogue in Beijing on Monday.
He is also expected to reiterate the EU’s discontent over trade imbalances. The EU’s trade deficit with China widened to $276.6 billion in 2022, compared to $208.4 billion a year earlier, Chinese customs data shows.
At the same time, Dombrovskis is being pressed by China to explain the EU’s risk reduction strategy.
“Our strategy is not protectionist and country independent,” said Dombrovskis.
As Europe turns away from Russian oil, gas and coal, the EU is examining its dependence on China for some raw materials and components, as well as the factors that determine the competitiveness of some Chinese products in the European market.
The European Commission recently said it would examine whether to impose tariffs to protect European manufacturers from a “flood” of cheaper Chinese electric car imports that are said to benefit from government subsidies.
The EU said it was open to competition, including in the electric vehicle sector, but competition must be fair. China has described the investigation as protectionist.
“The European side has repeatedly assured the Chinese side that ‘derisking’ does not mean ‘decoupling,'” the nationalist Chinese tabloid Global Times wrote in an editorial.
“We believe they are saying this sincerely. However, we cannot accept and strongly oppose the use of trade protectionism to reduce risks,” it said.
Reporting by Ryan Woo, Bernard Orr and Yew Lun Tian; Editing by Himani Sarkar and Jacqueline Wong
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