European Leaders and Xi Jinping Discuss Trade Relations

BEIJING (AP) – European leaders met with President Xi Jinping in Beijing on Thursday, advocating for a more balanced partnership with China.

During their initial statements, they highlighted trade and urged actionable steps to tackle Europe’s significant trade deficit.

“As our cooperation grows, so does our imbalance,” remarked Ursula von der Leyen from the European Commission. “We have reached an inflection point. It is essential to readjust bilateral relations because, to be sustainable, relationships must be mutually beneficial.”

The expectations for the summit have shifted; while originally slated for two days, it’s now condensed to one. This comes amid global economic uncertainty, conflicts in the Middle East and Ukraine, and potential US tariffs. The stakes are high, as both the EU and China navigate the challenges presented by their economic rivalry.

Antonio Costa, President of the Council of Europe, urged China to leverage its influence over Russia to facilitate an end to the war in Ukraine.

Costa mentioned a potential climate agreement and expressed hope for a “strong joint political message” from the summit, particularly with the annual UN climate discussions approaching in Brazil this November. This message could emerge after discussions with Chinese Prime Minister Li Qiang later.

Xi Jinping emphasized the need for deeper cooperation between China and Europe, which he believes would enhance stability in a complex global landscape. He stated that both parties should acknowledge their differences while working towards a shared foundation in their relationship.

China is prepared to intensify its climate initiatives and support efforts to combat climate change, he added, but also opposed EU restrictions on its exports.

“Please avoid opening up trade and investment markets using restrictive economic tools, and create a favorable business environment for Chinese companies in Europe,” Xi urged.

In addition to trade and the situation in Ukraine, von der Leyen and Costa were likely to address concerns regarding China’s cyberattacks, espionage, and issues surrounding human rights in Tibet, Hong Kong, and Xinjiang.

Amid these discussions, the EU is also wary of its brewing trade conflict with the US.

Fabian Zuleeg, chief economist at the European Policy Centre, commented, “It will be quite challenging to achieve anything tangible.”

Despite various conciliatory gestures from China, including lifting sanctions against European lawmakers critical of its human rights policies in Xinjiang, China’s position in the EU appears strengthened. Analysts like Noah Birkin from the Rhodium Group noted that China feels it has weathered the storm of US tariffs and is less inclined to make concessions to the EU now that the political climate has changed.

“China was emboldened by the trade conflict with Trump, which diminished its willingness to concede to the EU,” he explained. “With Trump stepping back, China perceives a decreased necessity to engage with Europe.”

Last year, the EU, like the US, faced a considerable trade deficit with China, heavily relying on it for essential minerals and components for vehicles and electronics. When China responded to Trump’s tariffs by restricting exports, European automakers voiced strong objections.

In response to Beijing’s substantial subsidies for its automotive industry, the EU plans to impose tariffs on Chinese electric vehicles to level the playing field.

Concerns have also arisen regarding the rapid expansion of China’s market share in Europe, which some fear could jeopardize the EU’s capacity to produce its own green technologies. Job security for the 2.5 million automotive workers and 10.3 million other jobs indirectly tied to EV production is also at stake.

China has initiated research on European pork and dairy imports, imposing tariffs on products like French cognac. Alicia Garcia Herrero from the Bruegel think tank criticized EU regulations on medical device sales, expressing fears about potential legislation targeting Chinese industries.

Garcia Herero noted that the EU holds significant leverage since China relies on it as a major export market. “China has a clear intention to maintain this relationship, especially under US pressure,” she stated.

China has faced EU sanctions related to its involvement in Russia’s military activities in Ukraine, with recent measures targeting Chinese banks linked to these operations.

The Chinese Commerce Ministry has expressed its dissatisfaction with these sanctions, asserting their commitment to defending the interests of Chinese companies.

Caught between a tough Washington and a rigid Beijing, the EU is pursuing new alliances, exploring trade agreements with Indonesia and drafting partnerships in South America and Mexico.

In the lead-up to the meeting in Beijing, Costa and von der Leyen had been in Tokyo, where they established an alliance with Japan aimed at enhancing economic cooperation and countering unfair trade practices.

von der Leyen emphasized the need for solidarity among like-minded partners as they navigate a world increasingly marked by protectionism and economic exploitation.