In the fight against protectionism worldwide, China has found a supporter: the European Union, according to a report by Reuters. There is one condition, however--China must show it can play fair on trade and investment.
That is what European Trade Commissioner Cecilia Malmstrom said on Monday, February 6, during an EU-China relations and business conference.
During her speech, the EU trade chief subtly referred to Trump’s plans to impose tariffs on Chinese imports without mentioning his name or the United States. Trump’s motive behind the plan is to punish the Chinese for creating unemployment in the United States.
“If others around the world want to use trade as a weapon, I want to use it as a tonic, a vital ingredient for prosperity and progress,” Malmstrom said.
“If others are closing their doors, ours are still open--as long as there is the trade is fair. And we will give China every opportunity to uphold its pledge against protectionism, and towards a multilateral agenda, too.”
Malmstrom noted in her speech, however, existing “barriers and irritants” in trade between the EU and China, as well as the imbalance in economic relations between the two parties. For example, China’s trade investments in the EU increased to almost $42.93 billion in 2016, but European investments in China totaled to less than 8 billion, representing a 10-year-low.
With an EU-China investment agreement currently in the works, Malmstrom hopes for the disparity between investments to be remedied in the near future.
Malmstrom also expressed awe and praised President Xi Jinping’s speech at the World Economic Forum in Davos last January. According to Malmstrom, the speech left the impression that China is the leader of the globalized world.
A challenge for China, however, would be to match its words with concrete actions on trade reform, as a trade war would be disastrous for all parties involved.