We don’t agree with Trump, but that doesn’t mean we want to gang up on America with China, says senior EU adviser ahead of summit

Head of Brussels group says trying to escalate international disputes could lead to ‘dire consequences’

PUBLISHED : Monday, 16 July, 2018, 3:01am
UPDATED : Monday, 16 July, 2018, 2:35pm

The European Union is reluctant to “gang up” on America with China despite calls to provide a counterweight to Donald Trump’s protectionist policies, the head of an EU advisory body has said.

Luca Jahier, the president of the European Economic and Social Committee, told the South China Morning Post that the US still remains an important political and economic partner of the EU, even though the EU opposed Trump tariff measures.

Jahier said he strongly opposes protectionism, but escalating the situation would not be the appropriate response.

“We ought to be careful not to respond to aggressive behaviour with aggressive behaviour. I don’t believe trade wars can be resolved by [adopting] protectionist stances,” Jahier said ahead of Monday’s annual China-EU summit in Beijing.

“The European Union has already seen the dire consequences of those policies in the past, and has learned its lessons,” he added.

Jahier was speaking ahead of Monday’s high level EU-China dialogue.

EU and China have chance to turn words into action

On July 6, the US imposed tariffs on Chinese goods worth US$34 billion to which China responded with similar measures.

Jahier said the EU-China relationship was important because the bloc is China’s second biggest trade partner. But he also argued that the EU still faces myriad difficulties in accessing the Chinese market and called for Beijing to do more to ensure fair competition.

“EU companies face a closed [market]. There is no reciprocity in China towards our investors compared with the opening up of EU [markets] to Chinese companies,” he said, noting that market restriction has resulted in a reduction of its Foreign Direct Investment to China.

“We want that to change.”

Both the US and EU have shared concerns on issues such as market access, intellectual property rights violations and government subsidies to hi-tech industries.

But Trump’s tariff measures have pushed Brussels and Washington further apart and China has asked the EU to work with it to oppose protectionism, including by setting up a working group at the World Trade Organisation.

Jahier said: “China, the US and the EU countries are members of the WTO, and are obliged to [follow its] practices … We expect the US and China to tackle their differences on that basis,” he said.

“Since the mid-20th century, the EU has firmly contributed to internationally agreed rules and institutions together with the US. We believe in the strength and validity of those mechanisms.”

But Jahier acknowledged that existing rules and institutions also have room for further improvements.

“The EU is working hard to create a level playing field for all countries and reciprocity is crucial to create that,” he said.

EU pushes China on opening market for food imports

He also said that if the US started putting tariffs on European goods the EU would act to protect its own interests.

“We will not sit idly by while our industry is [being] hit with unfair measures which put thousands of European jobs at risk,” he said.

Trump said in June that he may impose tariffs on European cars.

“The trade war is more like the Trump administration versus the rest of the world and this go-it-alone action doesn’t help the global economy,” Jahier said.