Brussels, 23/10/2015 (Agence Europe) - On Thursday 22 October, Aegis Europe, a group of 30 European industrial associations, warned against the enormous trade imbalance that the EU is undergoing with regard to China - with recent Eurostat figures showing the deficit as due to reach a record €180 billion this year. Aegis Europe is urging the EU not to grant China market economy status, which would prevent the EU from being able to defend against Chinese social dumping.
The EU's trade deficit with China is increasing steadily every year and in 2015 Chinese exports to the EU will account for double the European exports to China, with an additional gap of €45 billion (or 30% more) compared with 2014, Aegis Europe states. The group criticises the rise in Chinese subsidies and the Chinese government's support for overcapacity.
“Europe's partnership with China is not balanced. China, as a planned economy, subsidises its industry to the tune of billions of euros and massively underwrites financing of Chinese exports. Meanwhile, in Europe whole industries are disappearing”, Aegis Europe states in a press release following the visit of China's President Xi Jinping to the UK at the start of the week. “Britain's energy and finance sector deals with China should not obscure the fact China is pursuing a clear course of expansion in Europe. China does not respect basic rules of the market economy. Diplomacy is important but it must also include honesty. The EU must make clear that it requires China to be in compliance with international trade rules”, the group adds.
In addition, Aegis Europe urges the EU not to grant China market economy status after December 2016 (a request from China that is currently being studied). In granting this status, the EU would lose its ability to defend itself with appropriate anti-dumping measures in the face of unfair Chinese competition - which would affect the competitiveness of the EU's manufacturing sectors considerably, and would weaken its economies that are already fragile from the crisis, Aegis Europe warns. The group recalls that according to a study from the Economic Policy Institute in Washington published at the end of September, granting China market economy status would endanger up to 3.5 million jobs in the EU and would cause losses for the EU economy of up to 2% of GDP - particularly affecting Germany, Italy, the UK, France and Poland. The most affected sectors would be those of steel, ceramics, aluminium, paper, glass, automobile pieces, chemicals and environmental technology. All these sectors are represented by the 30 associations brought together under the banner of Aegis Europe. The sectors account for over €500 billion in annual turnover and millions of jobs in the EU. (Original version in French by Emmanuel Hagry)