Tuesday, March 26, 2013

Problem of China-EU trade frictions

CHINA: Chong Quan, deputy representative of the Ministry of Commerce international trade negotiations on the EU-China trade friction, answered a reporter's question about. As follows:

The EU photovoltaic products dual investigation formally opened for some time, you tell us after placing the communication between the two? Between China and the EU did have a number of similar cases, this case any different? In early June, the EU will make a preliminary ruling, the remaining two months time, the Chinese side believes that should be how to solve this problem?

Chong Quan: The Chinese government attaches great importance to China-EU PV trade friction case, it has maintained a position on the settlement of disputes through dialogue and efforts to this end. Since last year, we had several discussions with the EU at the political level and the technical level of communication and consultation last year, Premier Wen Jiabao had personally with the leaders of the European Commission and EU member states on the case to communicate, the Ministry of Commerce also repeatedly sent -level delegation to Europe consultations and working groups.

Communication channels of the two sides at all levels has been unblocked, China has never interrupted or delayed for any reason, the consultations with the EU. Currently, the case is still under investigation procedure, the China the respondent work is proceeding in an orderly manner. The Chinese side has always been not to abort and abandon efforts to resolve disputes through consultations with the EU.

Had a lot of trade friction between China and the EU does, but the PV product the double reverse investigation into whether from the amount of money involved, industry type or from the impact of view, are unprecedented. The first involved a large amount of money, according to preliminary estimates, the photovoltaic cells involving more than $200 billion of Chinese enterprises export, EU trade remedy investigations in 2012 in cases involving more than 70 percent of the amount. Secondly, the case affected the world in clean energy strategic emerging industries.

Since 2012, the global financial crisis, the international photovoltaic products, prices and other factors, in addition to initiating trade remedy measures, the United States and Europe for me photovoltaic products photovoltaic industry industry downturn and loss phenomenon experienced unprecedented development difficulties, serious impact on the the development of new energy industry.

According to statistics, in 2012 the Chinese photovoltaic products exports year-on-year decrease of 35 percent, including solar cells and components exports fell by more than 40 percent. Just a few days ago, China's largest PV company Suntech Power Co., Ltd., declared bankruptcy reorganization. Again, the most important point, the case involving a large number of China's photovoltaic industry employment, preliminary statistics will affect more than 40 million of the working population.

For these reasons, the Chinese government attaches great importance to the case. There is no doubt that the photovoltaic case, such as improper handling, is bound to give the EU economic and trade relations have serious negative impact.

China and the EU are important trade partners to each other, a huge bilateral trade volume, are highly complementary, and have extensive cooperation and common interests in many fields of photovoltaic products, automobiles, aircraft, and agricultural products. Properly handle trade frictions related to the overall situation of the healthy and stable development of China-EU economic and trade relations.

Here, I would like to reiterate that the Chinese Government has consistently advocated by industry dialogue and cooperation to solve the problems of development and competition, we once again call on the EU to seriously consider China's stance and proposals to give serious consideration to the voice of the EU PV upstream and downstream industries, prudent use of trade remedy measures through consultation and cooperation to resolve the photovoltaic products trade friction. China and the EU are members of the WTO, should work together to contribute to the maintenance of world trade order.

If the final ruling sees unfavorable results, will the Chinese side will take retaliatory measures? Will there be a trade war between China and Europe?

Chong Quan: At present, the European Commission of the Chinese PV anti-dumping countervailing investigation procedures. The Chinese government, enterprises involved and related industry associations is to carry out the laws and responding to the work. China will closely follow the investigation procedures and rulings of the European side, the EU does not comply with the WTO in the survey, the Chinese side will promptly carry out the government to negotiate rights retained recourse to WTO dispute settlement body.

We do not want to see a trade war with any country. Especially between China and the EU in the fields of bilateral economic and trade all-round cooperation, merging interests to fight a trade war, anyone afford to lose. Although the Chinese PV industry strongly urge the Government to take counter-measures, but the overall situation from the China-EU cooperation, always exercise restraint, has no intention to provoke any trade war, efforts to solve problems through dialogue and consultations.

However, the photovoltaic industry involving the major interests of the Chinese side, if the EU stubbornly insist on handicapping the product, and serious damage to the interests of Chinese companies, the Chinese government will not stand idly by. We have no choice, and will take all measures to safeguard the legitimate rights and interests of enterprises. I hope we can find a solution acceptable to both sides in the negotiation process.

We note that the EU member states have different voices for the photovoltaic case, such as German Chancellor Angela Merkel had publicly expressed opposition to the trade restrictions, and the EU photovoltaic industry does not endorse the handicapping?

Chong Quan: In fact, for a long time, China and the EU in the field of photovoltaics are mutually dependent and mutually beneficial cooperation, you have me, I have your pattern of relationship between the upstream and downstream enterprises of both sides in the entire PV industry chain.

Advantage of China's industrial production processes in the battery components and solar panels, but most of the raw materials required for production equipment and production techniques imported from the EU and other countries, because the European Union has an advantage in terms of research and development of photovoltaic technology, raw materials and equipment manufacturing also due to the huge demand of the EU market to Chinese exports to the EU reached the scale of today.

The photovoltaic industry is clearly of economic globalization, the international division of labor, and the two sides play the results of comparative advantage. China's total PV production equipment imported from overseas, nearly 40 billion yuan, of which a considerable part from the European Union.

China PV industry development has not only led to the EU export of raw materials and high-end equipment, but also created a lot of jobs for the downstream industry of the EU photovoltaic power installation. Like so you me, I have your product, event trade friction must be implicated parties. Recently, a Swiss independent research organization released report shows that, if the EU to impose punitive tariffs on China's photovoltaic products, will enable the European Union to the loss of 242,000 jobs, including Germany, the hardest hit, could lose about 85,000 jobs within three years . The EU photovoltaic manufacturers may add the number of jobs PV industry chain will not exceed a maximum of 20 percent of the jobs lost.

Photovoltaic products to China trade friction issue, some EU member states as well as related industries have been a different sound. German Chancellor Angela Merkel's visit to China in August last year, made ​​it clear that the restrictive measures against the European Commission to China PV products, PV industry, including trade friction appeal to be resolved through dialogue and consultation. September thereafter, she a press conference in Berlin, reiterated this position. In February this year, the EU can pay for energy Federation (AFASE) also strongly opposed to the European Commission restrictions on my photovoltaic products.

The attitude of the EU Member States and industry to prove that, properly handle trade frictions, not only conforms to the interests of Chinese industries, also in line with the interests of the EU industry. We call on the EU objective and rational analysis of the reasons of the domestic photovoltaic industry is in crisis, and the fair and equitable treatment of the Chinese PV companies adhere to industry dialogue and mutually beneficial cooperation to solve the problems in the development and competitiveness, proceed from the overall situation of China-EU economic and trade cooperation, careful to make ruling.

Earlier, the British Financial Times has reported that the European Union to the Chinese on both wireless communication equipment thing made ​​three asking price, what is true? In this case, you think what is the solution? 

Chong Quan: China is highly concerned about the EU's wireless communication equipment products trade friction, also noted that the recent media reports. China and the EU are important wireless communications equipment market, a good and mutually beneficial cooperation has been carried out. Wireless communication devices in China in 2012 accounted for approximately 20 percent of the EU market share, European manufacturers accounted for approximately 38 percent of the market share of wireless communication equipment.

The EU raised the asking price, a precondition for talks is in line with WTO rules, in line with market economy rules and the principle of fair competition. China and the EU in the field of wireless communication, not only has been such a good, close cooperation, the future should be better cooperation, because this market has great potential. I want to emphasize is that the Chinese market is always open, especially in China's telecommunications market.

We welcome the European companies to participate in the competition in the Chinese market, the market share of its technology, service and strength. Also hopes that the EU will also give Chinese companies to participate in the competition in the European market, and possession of a due share of the market fair treatment. European enterprises can also strengthen cooperation in joint research and development, together cake bigger share of the market can also jointly develop the market of a third country.

The relationship between China and the EU in the telecommunications market is a kind of a prosperity, a loss for both sides of the relationship. We can not engage in confrontation, fight a trade war. We should be fair competition, mutually beneficial co-operation!

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