EU, China to talk trade as tensions mount

–Virtual meeting replaces full summit with all European leaders cancelled due to coronavirus

BRUSSELS: EU leaders will hold video talks with Chinese President Xi Jinping on Monday hoping to make progress on trade and investment, even as tensions mount between Beijing and the west.

The virtual meeting between top Chinese officials and EU Council President Charles Michel, European Commission Chief Ursula von der Leyen and German Chancellor Angela Merkel, replaces a full summit with all 27 European leaders which had to be cancelled because of coronavirus.

China has said an investment deal already seven years in the making can be agreed by the end of the year, but EU officials warn significant obstacles remain and insist they will not agree to unfavourable terms simply to cut a deal.

“Even if there is a political objective to accelerate negotiations and conclude them by the end of the year, we will have this only if it is something worth having,” an EU official said.

Brussels says “significant progress” has been made in talks since a similar video summit in June, and officials hope to agree on a “roadmap” to get a deal done by the end of the year, but they also warn that Beijing needs to do more to improve market access for European companies.

Brussels wants to reinforce respect for intellectual property, end obligations to transfer technology and see a reduction in subsidies for Chinese public enterprises.

No major breakthrough is expected on Monday but the EU side hopes to persuade Xi, China’s paramount leader, to give fresh political impetus to the talks — and to allow his negotiators more room to compromise.

The meeting comes as ties between China and the US deteriorate, with both sides locked in fierce recriminations over trade disputes, human rights and the origins of the coronavirus pandemic.

Washington and Beijing this week imposed reciprocal curbs on each other’s diplomats, after another tit-for-tat in July when the two governments ordered the closure of consulates in Houston and Chengdu.

Both sides have sought to enlist the EU in their spat, and during a visit to Brussels by US Secretary of State Mike Pompeo in June, the EU’s Diplomatic Chief Josep Borrell mooted talks to forge a common transatlantic front against China.

But little progress has been made on this initiative and broadly Brussels has preferred to forge a middle path, treating Beijing as both a potential partner and a “systemic rival”.

“The EU stands firm on its interests and values but also wants to cooperate with China,” a senior EU official said.



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