US-China trade war: All stories

China proposes stronger ties with EU to counter US trade threats

Premier stresses mutual interest in telephone conversation with European Commission President Jean-Claude Juncker ahead of this month’s summit

PUBLISHED : Thursday, 05 July, 2018, 3:26pm
UPDATED : Monday, 16 July, 2018, 1:21pm

Chinese Premier Li Keqiang has called on the European Union to expand its cooperation with China to counter the United States in the escalating trade war as the start date for American tariffs approaches.

Li made the proposal in a telephone conversation with Jean-Claude Juncker, president of the European Commission, the European Union’s executive body, according to a statement on Thursday by the Chinese foreign ministry.

Li started a six-day visit to Bulgaria and Germany on Thursday.

US tariffs on US$34 billion of Chinese products are due to come into effect on Friday, with China vowing to retaliate with similar tariffs against US products.

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“The international situation is complicated, with the rise of unilateralism and protectionism,” Li was quoted as saying.

“As two important forces in the world, China and the EU have to reach consensus, and expand cooperation and mutual interest to deal with the challenges.”

China is seeking support in the trade confrontations with the US. Reports have suggested that Beijing is calling on the EU to issue a joint statement against US trade policies.

Last month, China and the EU said they would set up a working group to revamp the World Trade Organisation (WTO) to counter US unilateralism.

China, EU plan working group to revamp WTO and counter US unilateralism

The two parties will hold a summit this month, with both seeking to counter US trade actions. They might also play down points of disagreement discussed at last month’s meeting, such as Beijing’s subsidies to its hi-tech industry and limits on access to Chinese markets for EU companies.

Both China and the EU have come under fire from US President Donald Trump, with Trump saying on Sunday that “the European Union is possibly as bad as China, only smaller”.

The EU has been calling for a return to multilateral trade dispute mechanisms such as the WTO.

Donald Trump threatens to impose 20 per cent tariff on European car imports

The EU has also taken retaliatory measures of its own. Late last month it introduced tariffs on US$3.3 billion worth of US goods, and it has threatened tariffs on an estimated US$300 billion of US goods in response to potential US tariffs on the car industry.


China’s threatened tariffs, to counter the US due to begin on Friday, are expected to come into force immediately after the US makes its moves official.

On Wednesday, China’s finance ministry said it would not make the first moves in implementing tariffs but would respond to US actions.

Shanghai University Professor Jiang Shixue said China and the EU could take their grievances to the WTO, and increase trade between the two sides.

Kerry Brown, director of the Lau China Institute at King’s College, agreed that the WTO – and reform of the organisation – could be a way to change the game of world trade in China and the EU’s favour.


“This is the only global platform for multilateral trade left, so the EU and China will work hard to salvage it. It’s a stark choice – you have it, or you have nothing, and go back to bilateral deals, starting from scratch again,” Brown said.

He said an overhaul of the WTO could be a major chance for the EU in particular to assert its vision of world trade, and possibly make gains in its own problems with China, such as greater market access and more effective dispute resolution measures.

“If the EU is strategically smart, it could be an opportunity for it assert the kind of fair system of open markets and rules-based norms it always promotes, as opposed to the American kind of protectionism and the Chinese adherence to law by the letter, but not in spirit,” Brown said.