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EU Leaders Press China for Trade Rebalance Ahead of Trimmed Beijing Summit

Brussels will demand Chinese action on overcapacity and market access at a single-day summit after Beijing urged Europe to rebalance its mindset

Flags of European Union and China are pictured during the China-EU summit at the Great Hall of the People in Beijing, China, July 12, 2016. REUTERS/Jason Lee/File Photo
On Tuesday, European Commission President Ursula von der Leyen said that there needed to be a “genuine rebalancing” in the China-Europe relationship.
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Overview

  • On July 8, Ursula von der Leyen targeted China’s record US$357 billion trade deficit with the EU and called for curbs on subsidised overcapacity undermining European industries.
  • The EU will push for reciprocal market access, including ending forced localisation of staff and R&D and opening Chinese public procurement to European firms.
  • Brussels plans to press China to loosen export restrictions on rare earths, over which Beijing controls nearly two-thirds of mining and 92 percent of refined output, to diversify critical supply chains.
  • EU leaders will also highlight concerns over China’s “no-limits partnership” with Russia and accuse Beijing of enabling Moscow’s war economy.
  • China’s foreign ministry spokeswoman Mao Ning rejected the EU’s demands on July 9, insisting Europe must rebalance its mindset and casting doubt on President Xi Jinping’s attendance at the July 24 summit.