Support for euro? It is rare for China to stumble or make tactical errors. Since it chose to go down the road of co-operation with Europe, it has pursued this path with tact and consistency and has even purchased treasury bonds (in euro) issued by member states experiencing difficulties. Chinese political and economic leaders have visited the EU many times recently and have been able to clarify their country's positions, respond to certain criticism, smooth out a number of concerns, and clarify and justify the initiatives and positions that they have taken. It is not a sudden gush of sympathy for Europe that is propelling this position; China's choices are in keeping with that country's interests. This is all very well and good because it is indeed this factor, which guarantees the sustainability and effectiveness of this new direction.
Let's look at the case of currency. A staggering volume of dollars is held by China and it is certainly not in its interest for these reserves (accumulated over a number of years) to lose their value. The US position leaves it up to the markets to decide rather than formally list the dollar's value, which compels China to deal with this question itself and expose itself to the possibility of a radical depreciation in its monetary reserves. In Washington, the famous slogan, “the dollar is our currency but it is your problem”, is still valid. If China suddenly lets go of a significant amount of dollars it holds, these dollars would automatically be devalued. The preferred option is to purchase treasury bonds in euro, even when these bonds are issued by EU countries experiencing difficulties. The operation has obviously been positive for the latter, whether it be Portugal or Spain. Unless there are any unexpected developments, this operation will be further strengthened, while we wait for eurobonds to come into being …
“Rare-earths”. The second case involves strategic rare-earth metals, on which China has almost a total monopoly. Karel De Gucht stated that any artificial restrictions on their export are unacceptable. He did, however, clarify that China does not in fact control half of the known global reserves but almost a third, and is also almost exclusively responsible for producing and exporting these metals (up to 97% of resources on the market). It is currently in the process of gradually reducing its production, for what it claims are mainly environmental reasons. We are aware that the WTO accepts environmental reasons as an exception to free trade rules. Since China is not restricting the exports themselves, but reducing production volumes (complying with environmental requirements applied elsewhere), it is therefore inappropriate to accuse the country of trade protectionism. The most suitable response would be partly to seek resources from other sources (Australia, California, India, Vietnam and, above all, Africa). Further recycling efforts and technological progress should be made, improving the yield or helping develop alternative products.
Dossiers requiring clarification. Although the Chinese authorities are consolidating new avenues of cooperation, there are, nonetheless, many other dossiers that require clarification: Chinese respect for patents and intellectual property, conditions for foreign investment in China, and anomalies involving state support for Chinese companies exporting abroad. Certain analysts consider that China's trade surplus with the EU is mainly the result of information-technology pirating and if China purchased licences instead of copying software, EU-China sales and purchases would be more or less the same. Other more controversial dossiers could be added to this equation, such as European car manufacturing bosses suspected of corruption (the Renault affair) but in this case we are entering the arena of high-level corporate crime, in which the authorities obviously deny any involvement and in which justice should be allowed to run its course. Overall, the most recent Euro-Chinese meetings have focused on all aspects of reciprocal relations and even the disagreement on certain dossiers, and European misgivings about accepting certain Chinese demands are now being treated with both understanding and a certain calm (at least on the surface) by China's representatives. There is still a long way to go before the situation improves on intellectual property, accurate labelling and the quality of certain product categories. The EU must treat the sensitive and crucial issue of the mass purchasing of European companies seriously. Vice-President of the European Commission Antonio Tajani has drawn attention to this question.
The conclusion to be drawn is clear: it is necessary to get used to co-operating with the Chinese and they now appear willing to pursue going down this road. Obviously, it is quite normal that protests of a political colouring are kept on the agenda and these are sometimes necessary because there are also benefits and demands that go together with indignation. Principled opposition cannot, however, be allowed to undermine economic development, if this development is expanding. (F.R./transl.fl)