Borrell says trust between EU, China ‘eroded’

EU foreign policy chief Josep Borrell warned Friday that trust between the bloc and China had been eroded, blaming the trade imbalance between the two on “difficulties” faced by European companies in the world’s second-largest economy.

Borrell arrived in China on Thursday, looking to manage the bloc’s “de-risking” strategy with its largest trading partner while laying the foundations for a planned summit this year.

“Trust is at the core of any human relationship, and… common trust has been eroded,” Borrell told an audience at Peking University in the Chinese capital Friday.

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“We have to work to rebuild this trust,” he said.

“It will not come back miraculously,” he added. “It has to be restored.”

He stressed that the trade imbalance between the bloc and China — 400 billion euros ($423 billion) — “is not only quantitative, but also qualitative”.

“It affects sectors in which we enjoy a comparative advantage… we believe that the problem is not rooted in a simple difference in productivity,” he said.

“To my mind, to our mind, the cause is the result of persistent difficulties experienced by European companies when they want to gain access to the Chinese market.”

Challenges to address

Borrell’s trip, which was postponed twice this year and is expected to last until Saturday, started in Shanghai Thursday with a meeting with European companies on economic and business challenges, described by Borrell as an “inspiring exchange”.

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“We must address these challenges because neither we nor China can ignore each other’s market,” he wrote on social media.

He is due to meet China’s foreign minister Wang Yi later on Friday.

The EU says the trip — the latest in a string of high-level EU-China dialogues — “should culminate in the EU-China summit later this year”.

Foreign Ministry Spokesperson Wang Wenbin told reporters that “China welcomes” Borrell’s visit, adding that his trip would “inject new impetus into the two sides’ joint efforts to address challenges and maintain world peace and stability”.

“The world is currently facing a volatile and turbulent situation,” Wang said.

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The visit comes just days after war broke out between Israel and Hamas, prompting Borrell to assemble an emergency meeting of European foreign ministers. China has called on all parties to “cease fire”.

China’s stance ‘difficult to understand’

Borrell’s visit is also likely to include dialogue on the ongoing war in Ukraine. China has sought to position itself as a neutral party, but the EU has been critical of its stance.

The bloc’s trade commissioner Valdis Dombrovskis said Beijing’s position was “affecting the country’s image” during his visit to China last month.

Borrell on Friday said China’s position was “difficult to understand”.

“We are not asking China to adopt the same standpoint as the European Union’s” on the war, he stressed.

“But we consider it essential that China makes a major effort to convince the people of Ukraine that China is not Russia’s ally in this war,” he said.

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EU chief Ursula von der Leyen — who carried out her own official visit to China in April — announced last month that the EU was launching an investigation into Beijing’s provision of subsidies for its rapidly rising electric vehicle industry.

European leaders have said that the Chinese subsidies have resulted in unfair competition in their automotive market.

But Beijing has criticised the investigation, warning that it will harm its trading relationship with the bloc.

Earlier this month, the EU named sensitive technologies that it must defend from rivals, including artificial intelligence.