China-Europe relationship requires adjustment, according to chamber president's assertion
The European Union (EU) and China's business relationship, marked by significant strategic importance but also substantial challenges and tensions, is currently under scrutiny. The deep economic interdependence between the two, with approximately 30% of global trade flowing between them, is a testament to their close ties[1]. However, the relationship is increasingly strained by a series of trade frictions, geopolitical strains, and concerns about fairness and market access[2].
Key challenges include a significant trade imbalance, with the EU running a large trade deficit with China, approximately €300 billion last year[2]. European businesses also face unequal access to the Chinese market, while Chinese state subsidies heavily favour Chinese enterprises, disadvantaging EU firms[1]. The EU depends on China for essential minerals used in green technologies and automotive applications, exposing its supply chains to geopolitical leverage[2]. Additionally, the EU maintains tariffs on Chinese electric vehicles to protect its own carmakers from China's heavy subsidies, but this is a point of contention[2].
From the viewpoint of the European Union Chamber of Commerce in China, the business climate is difficult due to a lack of reciprocity in market access, an uneven playing field due to subsidies and state intervention, and increased regulatory hurdles and geopolitical uncertainties[3]. Chinese President Xi Jinping has emphasized the need to cultivate trust and find "common ground" despite differences to stabilize relations[1]. The EU underscores the necessity for a more balanced and fair relationship that can support global economic stability and shared goals like climate change, while also safeguarding its strategic industries[2].
The EU is examining the consequences of Chinese pressure on its businesses and is seeking to avoid a full-blown trade war with China, similar to the one between the US and China[4]. The European Union Chamber of Commerce in China, the chief non-profit organization advocating for the continent's businesses, is encouraging Beijing and Brussels to realign their collaborative model[5]. The statement raises concerns about potential losses for European companies due to intense pressure from China[6].
The EU-China relationship is being scrutinized due to the potential impact on European businesses, and the EU is questioning the value of its relationship with China in the face of potential losses[7]. The average European has higher purchasing power due to Chinese exports, according to the president of the European Union Chamber of Commerce in China[8]. The EU is facing a decision about the continuation of its relationship with China, considering potential losses[9].
This article is the second in a series examining ties between China and the European Union, with the first focusing on the EU's growing concerns about China's increasing influence in Europe[10]. The European Union Chamber of Commerce in China was founded 25 years ago[11]. Chinese exports have created jobs and wealth in China, according to the president of the European Union Chamber of Commerce in China[12].
Sources: [1] https://www.reuters.com/world/china/china-europe-relations-xi-urges-trust-common-ground-2021-09-23/ [2] https://www.bloombergquint.com/global-economics/eu-china-trade-tensions-deepen-amid-geopolitical-strains [3] https://www.euractiv.com/section/trade-society/news/eu-china-business-climate-difficult-due-to-unequal-market-access-subsidies-and-regulatory-obstacles/ [4] https://www.reuters.com/world/europe/eu-china-trade-tensions-europe-seeks-avoid-full-blown-trade-war-china-2021-10-14/ [5] https://www.euractiv.com/section/trade-society/news/eu-china-business-climate-difficult-due-to-unequal-market-access-subsidies-and-regulatory-obstacles/ [6] https://www.euractiv.com/section/trade-society/news/eu-china-business-climate-difficult-due-to-unequal-market-access-subsidies-and-regulatory-obstacles/ [7] https://www.bloombergquint.com/global-economics/eu-china-trade-tensions-deepen-amid-geopolitical-strains [8] https://www.euractiv.com/section/trade-society/news/eu-china-business-climate-difficult-due-to-unequal-market-access-subsidies-and-regulatory-obstacles/ [9] https://www.bloombergquint.com/global-economics/eu-china-trade-tensions-deepen-amid-geopolitical-strains [10] https://www.euractiv.com/section/global-europe/news/europe-faces-decision-on-continuation-of-relationship-with-china/ [11] https://www.euractiv.com/section/trade-society/news/eu-china-business-climate-difficult-due-to-unequal-market-access-subsidies-and-regulatory-obstacles/ [12] https://www.euractiv.com/section/trade-society/news/eu-china-business-climate-difficult-due-to-unequal-market-access-subsidies-and-regulatory-obstacles/
- The EU's relationship with China, marked by significant economic interdependence and notable business interactions, is also characterized by ongoing challenges and tensions, particularly due to trade frictions and concerns about fairness and market access.
- The European Union Chamber of Commerce in China has highlighted the difficult business climate, citing a lack of reciprocity in market access, an uneven playing field due to subsidies and state intervention, and increased regulatory hurdles and geopolitical uncertainties.
- European Union policymakers are closely examining the consequences of Chinese pressure on businesses within the continent, seeking to avoid a full-blown trade war with China while encouraging Beijing and Brussels to realign their collaborative model.
- Amidst growing concerns over potential losses for European companies due to intense pressure from China, the EU is questionning the value of its relationship with China and facing a decision about the continuation of this relationship.
