Beijing, 13 Oct (EFE).-The European Union’s foreign policy chief Josep Borrell on Friday urged China to “redress” the worsening trade and economic imbalance with Europe, warning that otherwise the EU would expedite efforts to reduce dependency on Chinese exports.
During a press conference at Peking University in Beijing, Borrell highlighted that the EU’s trade deficit with China had surged by 60 percent in just one year, a change that does not reflect a productivity gap between the two economies according to him.
“It is in our interest to find common ground, to redress the imbalance in our economic and trade relations. Otherwise, de-risking (by EU) may indeed accelerate far more than is good, as the public opinion will increase its pressure on political leaders to disengage more from China,” the Spanish politician said.
Borrell said that as part of their de-risking strategy, the EU would concentrate on diversifying their supply sources to mitigate overreliance on a single market for imports, as the EU-China trade imbalance has continued to “worsen” in recent years.
“The EU-China economic relationship is deep – 2.3 billion euros of trade per day. But we must be alert when 95 percent of our imports in key sectors come from one only source,” he said.
However, the top diplomat clarified that the EU’s de-risking measures were not motivated by political concerns and were instead aimed at reducing dependence on a limited number of markets.
“De-risking; they are simply taken to protect our economies when we consider that we have become too dependent on a limited number of markets. Once again, de-risking is an instrument to increase our resilience, not a hostile measure against China,” he underlined.
Borrell attributed part of the growing trade deficit to the challenges European companies faced in accessing the Chinese market.
“On top of this enormous trade deficit we have seen a sharp downturn in European investment in China, which is at its lowest level since 2018. Without better access to the Chinese market, European investors are turning away,” he underlined.
The Spaniard acknowledged that the level of trust between the EU and China had been “eroded,” and needed to be “gradually restored.”
In recent developments, last week, the European Commission launched an investigation into whether Chinese subsidies to electric vehicle companies posed a threat to European manufacturers.
This could lead to the imposition of tariffs on Chinese electric vehicle imports as part of Brussels’ strategy to reduce dependence on Chinese imports.
Borrell, who arrived in China on Thursday for a three-day visit, is set to meet foreign minister Wang Yi to discuss various issues, including the Israel-Hamas conflict, the situation in Ukraine, and tensions between Beijing and Taiwan.
He has announced plans to express EU concerns to Beijing regarding cybersecurity and anti-spying laws, which require foreign companies, including those from the EU, to provide data to the Chinese government.
EU officials have been ramped up visits to China since the country reopened its borders after lifting COVID-19 restrictions earlier this year. EFE