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TRADE TENSIONS

China, EU agree to fight protectionism, but latter repeats complaints

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Mr Katainen with Mr Liu during the EU-China High-level Economic Dialogue in Beijing on June 25.

Beijing

CHINESE and European Union (EU) officials both agreed to oppose unilateralism and trade protectionism during talks in Beijing on a bilateral investment agreement, taking a swipe at US President Donald Trump's campaign of punitive tariffs.

But a top EU official made it clear that Europe is not fully on the same page as China, calling on Beijing to do more to make market access more fair and reduce overcapacity in steel and other sectors, including hi-tech.

Hosting the talks, Vice Premier Liu He stressed China and the EU had a common interest in defending the global multilateral trading system.

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"Both sides believe that we must resolutely oppose unilateralism and trade protectionism and prevent such behaviour from causing volatility and recession in the global economy," Mr Lieu told a media briefing after the talks.

The two sides expect to exchange lists of proposals for the bilateral investment agreement at a China-EU summit in Beijing next month, according to Mr Liu.

EU Commission vice president Jyrki Katainen said, however, that areas of disagreement also need to be addressed if China and the EU are to develop their economic, trade and investment relationship.

"It is essential that we work together to tackle overcapacity in sectors such as steel and aluminium," Mr Katainen said, specifically identifying the industries that Mr Trump first took aim at when he embarked on a tariff war in March.

He also urged China to prevent overcapacity in other industries, including high-tech sectors covered by the "Made in China 2025" strategy.

Last month, European lawmakers approved a far-reaching proposal for tougher scrutiny of foreign investments, partly in response to a flurry of Chinese acquisitions of European firms.

Mr Liu voiced hope that the EU would take concrete steps to lower restrictions on European exports to China.

The "Made in China 2025" plan aims to upgrade China's capabilities in advanced information technology, aerospace, marine engineering, pharmaceuticals, advanced energy vehicles, robotics and other high-technology industries.

Last month, European lawmakers approved a far-reaching proposal for tougher scrutiny of foreign investments, partly in response to a flurry of Chinese acquisitions of European firms. REUTERS