China must address trade gap with Europe or face more protectionism, Josep Borrell says
- In opinion piece for the Post, EU’s top diplomat blames the imbalance on a lack of access to the Chinese market
- He says if European voters think key sectors are being endangered, ‘they will demand more protectionist measures’
In an opinion piece for the Post, Josep Borrell said European voters will “demand more protectionist measures” if China does not help narrow its trade surplus with the EU.
He blamed the gap, which reached €396 billion (US$420.1 billion) last year, on the lack of market access afforded to European companies in China.
“We have raised these difficulties repeatedly with the Chinese authorities. We have observed a recent sharp downturn in European investment in China. Without better access to the Chinese market, European investors are turning away,” Borrell wrote.
“If the European public think that trade imbalances with China are endangering key sectors of our industry, they will demand more protectionist measures. It is therefore in our common interest to address the imbalances in our trade relations.”
EU’s China ‘de-risking’ plan targets AI, semiconductors, quantum tech, biotech
It can be viewed as part of a shift towards the securitisation of economic issues globally, a trend embraced in Brussels through its de-risking policy. This will see the EU reduce its dependencies on China for critical imports, and could see restrictions on exports and investments into China in certain hi-tech sectors.
Borrell defended the strategy, which Beijing has strongly criticised, pointing out that China has been following a similar approach for years.
Obstacles to better China-EU relations can be cleared
“When almost all our imports in some key sectors derive from one source, we must mitigate the risks to our supply chains from such strategic dependencies, in order to enhance our economic resilience,” he wrote.
“China itself has been pursuing this kind of policy for years. In 2020, President Xi [Jinping] said that ‘China must build a domestic supply system that is independently controllable, secure and reliable so that self-circulation can be accomplished at critical moments’. It is de-risking with Chinese characteristics.”
“Since the outbreak of the war against Ukraine, China’s ambivalent position has been difficult to understand in Europe, given the fact that it is clear that one country [Ukraine] is being attacked, and the other one is the attacker [Russia]. Europeans have felt that China has not been using its unique influence to persuade Russia to halt this aggression,” Borrell wrote.
In an interview with the Post earlier this week, Borrell said Europe was “not totally convinced by China’s argument that it is neutral in this conflict”.
“We are not asking China to adopt the same standpoint as the EU. However, China cannot have it both ways. In Ukraine, China’s interests are clearly different from Russia’s ones: China wants to engage with Europe, Russia seeks to demonise it,” Borrell said.
