EU-China Summit, Prague, 20 May 2009: Climate change, trade top agenda at EU-China summit

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Series Details 20.5.09
Publication Date 20/05/2009
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EU and China start to mend fences
By Joshua Chaffin and Jamil Anderlini
Financial Times, 20 May 2009

The European Union and China will return to the work of diplomacy and fence-mending at a summit in Prague on Wednesday as they seek to strengthen a relationship that is still a work in progress and marked by stubborn disagreements on a number of political and economic fronts.

Those divisions were on display in December when Beijing abruptly withdrew from the last Sino-EU summit to protest at the decision by French President Nicolas Sarkozy to meet Tibet’s exiled spiritual leader, the Dalai Lama.

The move was seen as an example of Beijing’s growing assertiveness on the world stage, and its diplomatic habit of trying to isolate some of the EU’s 27 member states. It also revealed the Chinese government’s fundamental gap with the liberal democracies of the west over human rights issues.

Both sides have since sought to play down the dispute. Earlier this week, EU officials said they did not expect the subject of the Dalai Lama to arise at today’s meeting, which will feature Wen Jiabao, the Chinese premier, Jose Manuel Barroso, the president of the European Commission, and Vaclav Klaus, president of the Czech Republic, the current holder of the EU presidency.

Instead, the top items on a scaled-down agenda are the global economic crisis and climate change. Both sides are expected to restate commitments to resisting protectionism that they made at the recent G-20 summit in London as they try to bolster confidence amid an historic economic downturn.

“It’s of special importance given the current global backdrop,” Song Zhe, China’s ambassador to the EU, said of the meeting at a seminar in Brussels on Tuesday.

At the same gathering, Benita Ferrero-Waldner, the EU’s external relations commissioner, acknowledged that the two sides had differences, but predicted the summit would be a “milestone in our common journey for a new global order.”

China has grown to become with EU’s second most important trading partner, after the US. From 2000 to 2008, EU exports to China more than tripled to €78bn. Yet the EU’s trade deficit with China has ballooned over the same period from €49bn to €169bn.

The global slowdown has dealt a serious blow to China’s trade-reliant economy, with exports to the EU dropping more than 22 per cent in the first quarter this year from the same period a year earlier, while imports declined over 15 per cent.

It has also increased trade tensions on both sides. China has bristled at EU moves to impose anti-dumping duties on a range of its manufactured goods, from candles to steel bolts while European policymakers continue to complain about access to the Chinese market and Beijing’s failure to protect intellectual property rights.

One area where the two sides could show progress today is a statement ensuring that their respective firms have the ability compete fairly for contracts that result from their economic stimulus plans.

“I hope we can build on that in Prague,” a European trade official said, noting that the two sides had discussed the matter during a recent high-level trade and economic meeting in Brussels.

The discussions on climate change come seven months before a global summit in Copenhagen in December, where nations will try to agree a successor to the Kyoto Protocol to reduce global warming.

The two sides are still far apart in those discussions, with the EU wanting China to commit to further emission reductions while China is demanding greater financial and technological assistance from developed countries.

Diplomats said they did not expect any breakthroughs at Wednesday’s meeting, although they expressed hope that it could build momentum for more substantive bargaining at the next EU-China summit later this year.

Expectations for the summit have been managed down significantly already.

“We expect the meeting will further enhance mutual trust, deepen reciprocal cooperation and boost Sino-EU ties,” Ma Zhaoxu, China’s Foreign Ministry spokesman, told reporters before Premier Wen left Beijing for Prague.

Copyright The Financial Times Limited 2009

Barroso presses China on green issues
By Joshua Chaffin and Jamil Anderlini
Financial Times, 21 May 2009

José Manuel Barroso, the European Commission president, on Wednesday seized on new evidence of Washington's commitment to fight global warming to nudge China into fresh concessions as climate change talks gather pace.

Speaking after a European Union-China summit in Prague, Mr Barroso urged China to "engage fully" on the subject, after praising Barack Obama, US president, for initiatives this week on fuel efficiency standards and reducing carbon emissions.

The US was now "moving in the right direction" he told Wen Jiabao, the Chinese premier. "I'm sure China will also engage fully and build on progress made recently", Mr Barroso added.

The challenge betrayed the hope among Brussels policymakers that a recent U-turn in US policy on global warming could force changes in Beijing and India.

"They don't want to be the freaks," a commission official said earlier this week, noting that both countries would feel less comfortable hindering a global agreement on greenhouse gas emissions now that the US had dropped its reluctance.

World leaders meet in Copenhagen in December to try to agree a successor agreement to the Kyoto protocol. In the lead-up to those talks, the EU has called for developing countries to pledge more ambitious cuts inemissions, while China and others have demanded that Europe and the US increase the financial and technological assistance to do so.

In response, Mr Wen said on Wednesday that China was committed to fighting global warming, but that the parties "should stick to the principle of common but differentiated responsibility", reflecting China's view that the developed world has the main responsibility for tackling climate change.

Both sides on Wednesday were at pains to gloss over differences and focus on areas of common cause concerning the economic and financial crisis. "We both recognise that it's important for us to work together to ride out the [economic] storm," Mr Wen said, as he pledged to work for stronger ties.

China has become the EU's second most important trading partner after the US. Between 2000 2008, annual EU exports to China more than trebled to €78bn ($107bn, £68bn). Yet the EU's trade deficit with China has ballooned over the same period from €49bn to €169bn.

The global slowdown has aggravated tensions on both sides, with China bristling at EU moves to impose anti-dumping duties on a range of its goods, while European policymakers continue to complain about access to the Chinese market and Beijing's failure to protect intellectual property rights.

Before leaving the stage, Mr Wen restated China's long-standing request that the EU grant his nation "market economy" status, which would improve its hand in anti-dumping disputes.

Copyright The Financial Times Limited 2009

Source Link http://www.euractiv.com/global-europe/climate-change-trade-top-agenda-news-221867
Related Links
BBC News, 20.5.09: China warns EU not to interfere http://news.bbc.co.uk/1/hi/world/europe/8060134.stm
European Commission: Press Release: IP/09/810: EU-China Summit in Prague – facing global challenges together http://europa.eu/rapid/pressReleasesAction.do?reference=IP/09/810&format=DOC&aged=0&language=EN&guiLanguage=en
European Commission: DG External Relatons: The EU and China http://ec.europa.eu/external_relations/china/index_en.htm
Deutsche Welle, 20.5.09: EU, China to put aside recent animosity at summit http://www.dw-world.de/dw/article/0,,4264646,00.html

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