Beijing hits back at European Union criticism of China’s ‘distorted state-run’ economy

China’s foreign ministry on Thursday criticised what it called the “thoughtless remarks” of the European Union, after the bloc introduced new rules to guard against excessively cheap imports and singled out China as a distorted state-run economy.

In a 465-page report, the European Commission said Beijing exerted a decisive influence over the allocation of resources, such as land or capital, and influenced prices of factors of production “in a very significant manner”.

The report is important because the EU has changed the way it handles anti-dumping cases.

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After two years of debate, the EU has agreed that dumping means selling for export at prices below domestic levels for all members of the World Trade Organisation (WTO), of which China is one.

In Beijing, foreign ministry spokeswoman Hua Chunying said the EU had made “thoughtless remarks” about China’s economic development, had “fabricated excuses” and been hypocritical.

“We urge the EU to strictly respect WTO rules”, and avoid abusing trade measures, Hua said.

“At the same time, China will take necessary steps to protect its legitimate rights,” she added, without elaborating.

China and the EU have long sparred over trade.

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On Thursday, the European Commission also launched an investigation into whether Chinese exporters of electric bicycles benefited from excessive state subsidies, adding to trade tension with Beijing.

In recent years, China’s economic development had helped boost global economic stability and development, Hua said.

“The facts prove that the system of socialism with Chinese characteristics accords with China’s reality,” she added.