‘Cooperation. Further cooperation.” This is what Chinese President Xi Jinping repeatedly called for during his most recent visit to three European countries—France, Serbia and Hungary.
During the first leg of his trip, in Paris on May 6, Xi delivered a speech titled Building on Past Achievements to Jointly Usher in a New Era in China-France Cooperation at the closing ceremony of the Sixth Meeting of the China-France Business Council.
He expressed enthusiasm for continuing to build mutually beneficial cooperation between China and Europe. “China and Europe are two major forces in building a multipolar world, two big markets that promote globalization, and two great civilizations that advocate cultural diversity,” he said.
Xi also pledged to “open the Chinese market wider to create more opportunities for companies from France, Europe and beyond.”
Earlier that same day, Xi attended a China-France-EU trilateral meeting with French President Emmanuel Macron and European Commission President Ursula von der Leyen at the Elysée Palace, where he underscored that China-EU cooperation is “complementary and mutually beneficial” in essence.
Partners for cooperation
At the meeting, Xi said China-EU relations enjoy a strong endogenous driving force and bright prospects for development, and the relationship does not target any third party, nor should it be dependent on or dictated by any third party.
The two sides have extensive common interests and broad space for cooperation in green and digital transition, Xi said, adding it is “necessary” for them to properly address economic and trade frictions through dialogue and consultation, and accommodate each other’s legitimate concerns.
Xi touched upon the accusations made against China regarding “overcapacity” in its new energy sectors. Whether viewed from the perspective of comparative advantage or global market demand, “China’s overcapacity problem” does not exist, he said.
Xi’s remarks were in direct response to claims made by U.S. and European officials that the “excess capacity” in new industries like electric vehicles (EVs), solar cells and lithium-ion batteries “distorts global prices” and “hurt firms and workers around the world.”
“China’s new energy industry has made real progress in open competition and represents advanced production capacity,” Xi stressed. “It not only increases global supply and alleviates the pressure of global inflation, but also contributes significantly to global climate response and green transition.”
“The EU is a pillar of the global economy and its members are some of China’s largest trading partners,” Keith Bennett, an international relations consultant based in London, told Xinhua News Agency.
“Therefore, whether from the standpoint of bilateral economic and political relations, world peace and security, or major-country diplomacy, China-Europe relations are a key part of the global order,” he said.
Official statistics reveal a robust economic relationship between the EU and China, with the EU standing as China’s second largest trading partner, excelling in both imports and exports. Similarly, China is the EU’s second largest trading partner, serving as its main source of imports and third largest export destination.
At the same time, Chinese and European enterprises exhibit confidence in each other’s markets, with cumulative investment between the two sides now exceeding $250 billion.
“I believe that the economic cooperation between Europe and China is something very important. China is strong, and that is why Europe has to develop itself and be strong also,” Marc-Antoine Jamet, Secretary General of luxury goods company LVMH Group, told Xinhua.
Noting that the world today faces major challenges, and that the international situation is at a critical inflection point, Macron said at the trilateral meeting that now, more than ever, France and the EU need to strengthen cooperation with China, as this bears on the future of Europe.
Von der Leyen said the EU wishes to work with China in the spirit of mutual respect, seek common ground despite differences, enhance mutual trust, avoid misunderstanding, jointly uphold the international order based on international law, and promote world peace, security and prosperity.
Uncertainty remains
China-EU cooperation is taking on a greater role in promoting global prosperity and sustainable development, but recent protectionist actions of the European bloc have cast a shadow on bilateral trade relations.
For example, in October 2023, the European Commission, the EU’s executive body, initiated an anti-subsidy probe into Chinese EVs, claiming to protect EU producers against cheaper Chinese EV imports, which were said to be benefiting from state subsidies. The investigation is still ongoing.
This countervailing duty investigation from Europe is based only on subjective assumptions about so-called subsidies and threats of damage, according to a spokesperson for the Chinese Ministry of Commerce. “It lacks sufficient evidence to support it and is inconsistent with relevant World Trade Organization rules, and China is strongly dissatisfied with this,” the spokesperson said on October 4, 2023.
The European side had required China to conduct consultations within a very short period of time but failed to provide “effective consultation materials,” which hurt China’s rights and interests, the spokesperson added.
The anti-subsidy measures launched by the EU, which threaten punitive tariffs on EVs imported from China, will not solve the challenges of the German and European automotive industry, Hildegard Mueller, President of the Association of the Automotive Industry, said in a recent interview with German newspaper Welt Am Sonntag.
China is an important market for German carmakers, which are involved in financing the green transformation at home with their revenue in China, he said. However, Mueller cautioned that the potential trade conflict stemming from the investigation could jeopardize jobs in Germany that rely on business with China.
He emphasized the importance of assessing interdependencies and risks before proceeding with the probe, suggesting that the automotive industry prioritize dialogue over confrontation to resolve disputes.
During his visit to China in April, German Chancellor Olaf Scholz said the European market must be open to Chinese cars, while calling for fair competition.
He noted that, when Japan’s and the Republic of Korea’s cars were launched in Europe decades ago, some feared that they would completely take over the market. But Scholz didn’t buy into this sentiment, saying there are Japanese cars now in Germany and German cars in Japan, and the same applies to China and Germany.
When addressing the closing ceremony of the Sixth Meeting of the China-France Business Council, Xi called on the EU to join China in “opposing attempts to turn business relations into political, ideological or security issues.”
“We should turn China and Europe into each other’s key partners for business cooperation, priority partners for cooperation in science and technology, and trustworthy partners for cooperation in industrial and supply chains,” Xi said. –The Daily Mail-People’s Daily news exchange item
