The EU is dissatisfied with its relations with China, but does not want a break. Europeans are studying measures to defend themselves from Chinese dumping and export subsidies. An EU-China investment agreement is now in doubt. For a former NATO secretary general, European companies should move away from China if Beijing does not open its market.
Brussels (AsiaNews) - The European Union seems unwilling to follow the United States in its aggressive strategy towards China.
For analysts, the EU is dissatisfied with its political and trade relations with China, guilty also of hiding the coronavirus pandemic in its early stages and using it to achieve geopolitical advantages. Yet, despite this, it does not want a break with China, but seeks instead to play a balancing role in the power struggle between Washington and Beijing.
“China will increase its global role. We have to engage with China to achieve our global objectives, based on our interests and values,” said Josep Borrell, the head of European diplomacy, speaking before the European Parliament yesterday.
The EU wants to compete economically with China. It does not plan sanctions, like those announced by the US in response to Beijing's decision to adopt a national security law for Hong Kong. However, the EU is vetting trade measures to defend European companies from China’s unfair practices.
On Wednesday, the EU Commission presented a new plan to protect the European market from Chinese dumping[*] and Chinese export subsidies to its companies. The initiative is aimed at all non-EU countries, but China is the main target.
“Europe's economy is open and closely interlinked to the rest of the world,” said Margrethe Vestager, Executive Vice President of the European Commission for A Europe Fit for the Digital Age.
For the Danish politician, trade and investments must be fair, and this cannot happen if foreign companies can openly buy companies in the EU space, but European investors cannot do the same outside the EU’s borders.
Since Chinese companies have full access to the European market, the EU wants equal treatment for European companies that wish to invest in China.
This is the major stumbling block in the negotiations over a trade agreement between the EU and China that is supposed to be inked by the end of the year.
According to Anders Fogh Rasmussen, a former NATO secretary general, if China does not open up its market adequately to European companies, the latter should move production to other countries.
This is the line taken by the Trump administration, which is looking at incentives to get US companies to leave China and return to the United States.
[*] To sell goods in foreign market at below price to drive out local competition.