EU trade chief hails Wen pledge of more help
The European Union's trade chief has welcomed Beijing's decision to take a greater role in resolving the euro-zone debt crisis, saying it 'will make a difference'.
After attending the 14th China-EU summit in Beijing this week, EU Trade Commissioner Karel de Gucht said yesterday that the EU economy had had its difficulties, but 'the reports of our death are greatly exaggerated'.
On Tuesday, Premier Wen Jiabao said China was 'ready to get more deeply involved in participating in solving the European debt issue'.
Wen's words were important because the crisis affects other countries, said de Gucht.
'It also makes a difference for China and other emerging markets, as the European economy is so big that the rest of the world can't prosper if the European economy is going in a wrong direction,' he said.
'It is not only an investment in Europe's problems, but an investment in its own future.'
While Beijing has yet to spell out its plans, investors are already speculating on the kind of investments it may make in the EU.
Some analysts anticipate investments in Europe's physical assets and others in sovereign debts.
Lou Jiwei, chairman of the China Investment Corporation, the country's US$410 billion sovereign wealth fund, said on Monday that European sovereign debts were not attractive investments.
China has foreign exchange reserves of about US$3.2 trillion, the world's largest.
Wen's remarks came just a day after Moody's downgraded the credit ratings of Italy, Portugal and Spain. The ratings agency also revised its outlooks for France, Britain and Austria from 'stable' to 'negative'.
On the trade front, de Gucht complained that China was stopping EU exporters accessing China's vast procurement market despite reforms in other sectors.
Citing EU Chamber of Commerce research, de Gucht said China's public procurement market was valued at 7 trillion yuan (HK$8.6 trillion), but only a fraction of this was open to foreign competition.