China 'could do a lot' to reduce impression of risk, says EU trade chief

The European Union has no plans to terminate ties with China, even as the group makes moves to decrease economic dependence and de-risk, but China “could do a lot” to assist in reducing the impression of risk, according to the EU trade head on Monday. The EU has long lamented China’s lack of a fair playing field and the politicisation of the economic climate. Concern shifted to wariness following Beijing’s decision to expand ties with Moscow despite the Ukraine conflict. The European Union has strong economic relations with China, but China “could do a lot to help reduce our perception of risk,” Trade Commissioner Valdis Dombrovskis said in a lecture at Tsinghua University in Beijing. This year, China also unveiled new laws, including a foreign relations law that warns against “acts” that are detrimental to China’s national interests and an anti-espionage law that prohibits the transfer of information related to national security that it does not specify, raising compliance risks for foreign companies. “Their ambiguity allows too much room for interpretation,” Dombrovskis said. “This means European companies struggle to understand their compliance obligations: a factor that significantly decreases business confidence and deters new investments in China.” Dombrovskis is expected to share his concerns with Chinese Vice Premier He Lifeng at a high-level economic and trade dialogue in Beijing on Monday. The dialogue, the 10th such discussion since 2008, will be a “litmus test” for the two sides, according to Chinese nationalist tabloid Global Times. Ahead of the dialogue, the European Commission last week declared that it would investigate whether to impose tariffs to shield European producers from a “flood” of cheaper Chinese electric vehicle imports it says benefit from state subsidies.