SHANGHAI, China: Addressing the delicate balance between maintaining an open economic relationship and safeguarding its interests, Valdis Dombrovskis, the Executive Vice President of the European Union (EU), emphasized the EU’s commitment to fair global trade.
During his speech at the annual Bund Summit conference in Shanghai, he noted that while the EU does not intend to decouple from China, it needs to protect itself when its openness is taken advantage of.
Dombrovskis highlighted the significant trade deficit of nearly 400 billion euros ($426.09 billion) that the EU faced in its trade with China, describing it as “very unbalanced.” He stressed the importance of striving for more balanced economic ties between the EU and China. This sentiment was reiterated during his four-day visit to China as he sought to enhance economic equilibrium.
This visit followed the European Commission’s recent announcement of investigating potential punitive tariffs on Chinese electric vehicle imports that could be enjoying undue advantages from state subsidies. Dombrovskis emphasized that the EU aims to minimize its strategic dependencies while maintaining a focus on de-risking rather than decoupling. He reaffirmed that the EU remains dedicated to the founding principle of an open market among its members and emphasized the significance of fairness in global trade.
The EU’s long-term interest is to embrace reforms and stay open to international cooperation.
We are also committed to free and fair global trade.
China is an important partner for the EU – and we want to work with China towards a more balanced trade & investment relationship. https://t.co/8U5sPOcePn
— Valdis Dombrovskis (@VDombrovskis) September 23, 2023
Tensions have escalated due to China’s relations with Moscow in the aftermath of the conflict in Ukraine, prompting the EU to reassess its dependence on China. However, Dombrovskis emphasized the EU’s determination to renew dialogue with China post the Covid-19 pandemic, aiming to mitigate tensions on various fronts, including foreign investment, trade, geopolitics, and criticism regarding China’s proximity to Moscow.
The EU’s significant trade deficit with China has been attributed, in part, to Chinese restrictions on European companies. EU Ambassador to China, Jorge Toledo, lamented the numerous barriers to market access, underscoring the historic trade deficit.
Dombrovskis engaged in an economic and trade dialogue with Chinese Vice Premier He Lifeng, recognizing the need for fair competition in sectors like electric vehicles. He emphasized that competition should be fair and that addressing trade barriers was a priority. The EU sought to engage both Chinese authorities and industry in the investigation to ensure a balanced approach.
