China-EU Summit set to boost mutual trust

17  January 2013

BEIJING — Facing the waning global economy and ongoing debt crisis, China and the European Union, two of the world’s major economies, are set to meet at the oncoming 15th China-EU Summit aiming for a deeper comprehensive strategic partnership.

With Chinese and EU leaders meeting in Brussels, high expectations have been set for the upcoming summit on boosting mutual trust and easing trade frictions, at a time when the recent solar panel dispute overshadows China-EU ties.

The next two days will provide a good opportunity for both sides to sit down and solve existing trade issues, which have hampered cooperations between the two giants amid the prolonged debt crisis.

After years of being each other’s major trade partner, both China and the EU must have been fully-aware that only by strengthening political mutual trust and economic cooperation can both sides fight off the debt crisis and achieve a win-win relationship.

In terms of battling the debt crisis, the two economies are actually quite complementary. Crisis-stricken European enterprises are thirsting for foreign investment to avoid bankruptcy, while China is willing to gain technical support for its domestic economic restructuring via such investment.

Therefore, trade protectionism is always the worst solution. Taking action against solar panel imports, as well as other products from China, will backfire on European enterprises. They will lose the strategically-important Chinese market, as many key materials and equipment for these products are western-made.

Trade imbalances do exist between China and the EU, but this is never a rare scene in global trade, especially between economies at different development stages.

Besides, China has displayed great initiative in solving such imbalances by boosting imports and domestic consumption, as well as reducing its reliance on exports.

Data from Eurostat showed that the EU trade deficit with China decreased to 67 billion euro ($87.5 billion) in the first half of the year, down from 75 billion euro during the same period in 2011.

China has kept an open mind in promoting global trade activities since its reform and opening-up. In the past 30 years, the country has turned itself into one of the most important markets for corporations and investors worldwide.

Meanwhile, seen from the EU side, setting restrictions to Chinese products and high-tech exports to China are unwise solutions that will only lead to a loss for both sides.

History has repeatedly proven that mutual trust and cooperation is the only key in combating a debt crisis and achieving long-term benefit. Will the two economic giants unite to lift themselves, as well as the world, out of crisis? The world is awaiting for an answer from the summit.