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Crossover: Vice Premier Liu urges EU to abandon protectionism


11-26-2016 06:35 BJT

Chinese Vice Premier Liu Yandong is on a three-day visit to Germany to promote friendly exchanges. For more on this, let's go to our correspondent Guy Henderson in Berlin.

Q1. At the 7th China Meets Europe Summit, Liu called on the EU to stay more open and abandon protectionism. But there are concerns from the German side over mergers and acquisitions by Chinese enterprises, especially in the high tech sector. What's your take on this?

A warm welcome - for Hamburg's guest of honour. China's Vice Premier Liu Yandong came here to elaborate the virtues of the Chinese economy - and urge Europe to continue to take advantage.

"Maintaining free trade serves the fundamental interests of China and Europe. Protectionism will lead to a lose lose situation - it is not the right way out for the world economy. China hopes that the EU will implement article 15 granting China automatic accession to the World Trade Organisation. It hopes the EU will adhere to non-discriminatory principles," said Liu Yandong.

It may not be so clear cut.

In the corridors and conference halls of the China Meets Europe Summit - delegates are still trying to digest how much the world may have changed since November 8th.

Europe faces a dilemma in the wake of the U.S. election result. On the one hand - some believe an American turn towards protectionism presses the economic case for building stronger trade ties with countries like China. Others argue quite the opposite: that with growing public scepticism about trade liberalisation generally - moving too quickly would be politically risky.

The latter seems to just about prevail here - at least for now.

There's talk the European Commission may apply the breaks in talks over a comprehensive investment agreement with China.

"They believe these agreements don't protect the local production, they don't protect the employment. They want to change this - they want to be very cautious and go slowly on that. What I see, then, is that we'll have a 4 year extension to these kinds of talks," said Vassilis Korkidis, Chamber of Commerce, Greek Port of Piraeus.

There is still broad support from both sides for a deal at some point.

"The bilateral investment agreement would cover liberalisation - and market access. But it would also cover investment protection as a classic investment treaty. So both sides would gain from that. And also - the kind of debates and discussions that we would have in these negotiations would also contribute to trust-building," said Mikko Huotari from Mercator Institute for China Studies.

There's a sense here that European policymakers may put re-gaining the trust of voters back home - ahead of furthering it with its partners abroad.

Q2. In what areas can the two countries work more to promote people-to-people and cultural exchanges, especially among the younger generation?

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