China Could Do ‘A Lot’ to Reduce EU Perception of Risk

Reuters

12:04 JST, September 25, 2023

BEIJING (Reuters) – The European Union has no intention of cutting ties with China even as the bloc takes steps to lower economic dependencies and de-risk, but China “could do a lot” to help reduce the perception of risk, the EU trade chief said on Monday.

The EU has long complained about a lack of level playing field in China and the politicisation of the business environment. Concern turned to wariness after Beijing’s move to strengthen ties with Moscow despite the war in Ukraine.

Europe’s economic ties with China are deep, but China “could do a lot to help reduce our perception of risk,” Trade Commissioner Valdis Dombrovskis said in a speech delivered at the Tsinghua University in Beijing.

China also unveiled new laws this year including a foreign relations law warning against “acts” detrimental to China’s national interests and an anti-espionage law barring the transfer of information linked to national security that it does not specify, raising compliance risks for foreign companies.

“Their ambiguity allows too much room for interpretation,” Dombrovskis said.

“This means European companies struggle to understand their compliance obligations: a factor that significantly decreases business confidence and deters new investments in China.”

Dombrovskis is expected to share his concerns with Chinese Vice Premier He Lifeng at a high-level economic and trade dialogue in Beijing on Monday. The dialogue, the 10th such discussion since 2008, will be a “litmus test” for the two sides, according to Chinese nationalist tabloid Global Times.

Ahead of the dialogue, the European Commission last week declared that it would investigate whether to impose tariffs to shield European producers from a “flood” of cheaper Chinese electric vehicle imports it says benefit from state subsidies.