Chinese Premier Li Keqiang has offered an olive branch to the European Union by saying Beijing will not undermine the bloc’s interests if it reaches a trade deal with the United States.
The EU, China’s largest trading partner, released a paper in which for the first time labelled China an “economic competitor” and “a systemic rival promoting alternative models of governance”.
But during the premier’s annual press conference on Friday, Li said: “China’s trade conflict with the US is a bilateral matter; we will neither take advantage of nor harm the interests of a third party”.
“China and the EU are important poles in this multipolar world, and China-EU cooperation will benefit not only the two parties but the whole world.”
Li admitted that there were frictions between China and the EU but called for deepening of mutual trust to solve the new issues, adding:
“We are now discussing an investment agreement that’s reciprocal and fair to both sides.”
China has been pushing Brussels to join it to defend free trade and a multilateral approach against increasing US protectionism, but the EU is worried that Beijing might drop this as the price of doing a deal to end the trade war with the US.
The bloc is also concerned that China might strike a deal that involves it agreeing to buy more goods from the US without addressing issues such as “unfair” state subsidies for industry or giving greater market access to foreign firms concerns shared by Washington and Brussels.
China’s efforts to settle European nerves will see a number of senior leaders visit the continent in an effort to strengthen ties over the next few weeks.
Chinese President Xi Jinping is expected to visit Rome and Paris later this month and looks set to agree on a framework deal for Italy to join its “Belt and Road Initiative”, despite US concerns about a G7 country joining the project.
Foreign Minister Wang Yi will visit Brussels later this month to attend the ninth China-European Union High-Level Strategic Dialogue and Li will follow him in April for talks with his European counterparts.
The premier said he hoped his visit would help develop mutual respect and understanding and “advance the healthy development of China-EU ties”.
Ding Chun, director of the Centre for European Studies at Fudan University, said Li was trying to assure the EU that Beijing would not undermine its interests when offering concessions to the US in its trade talks.
“Ties between China and EU are so different from the China-US relationship, which has strategic conflicts in many sectors,” he said.
Ding said that unlike the US, China had no strategic conflicts with the EU and the continent had been a key source of technology as it developed. “How could China sacrifice such an important partner?” he added.
Wang Yiwei, an international relations expert from Renmin University, said: “The EU is especially worried that a potential China-US trade deal would harm its interests. So Li wants to reassure them that China won’t make a deal with the US at the expense of the EU.”
China and Europe have long been steady trading partners, but in recent years the EU has become increasingly concerned about China’s growing footprint as its investments skyrocket.
In just eight years, Chinese foreign direct investment (FDI) in the EU has risen from less than US$840 million in 2008 to a record high of US$42 billion in 2016, according to Rhodium Group statistics.
Europe has also become increasingly worried about the role of the tech giant Huawei in communications networks across the continent and fears that projects such as the belt and road could erode the bloc’s influence and importance.
It has similar concerns about the CEEC-China (16+1), an initiative to improve economic cooperation with 11 Central and Eastern European countries – including non-EU members.
Western critics see the group as an instrument for undermining the EU by offering economic incentives to move closer to China.