EU, US Join Forces in China Bashing

♠ Posted by Emmanuel in ,, at 11/12/2007 12:53:00 AM
A few months ago at the US-EU Transatlantic Summit, George Bush, Angela Merkel, and EC President Manuel Barroso agreed to convene a Transatlantic Economic Council to discuss issues of joint interest. Last Friday, this council convened and its main focus was (surprise!) that dastardly, unfair trading partner known as the People's Republic of China. Here is part of an interview that involved EC Vice-President Gunter Verheugen on why a meeting that was supposed to be about bilateral relations focused on China:

QUESTION: You spoke about -- apparently during the lunch, we had -- you had a conversation about China. What -- can you elaborate on that? Is it -- what is the -- I don't understand; you are supposed to speak about your bilateral relations and --

MR. VERHEUGEN: Yeah, but I think the bilateral relations include challenges which we have -- that you have on both sides and, I mean, the whole exercise that we have started was not possible if both sides would not understand that we are sitting in the same boat, that we are facing the same challenges, and none of them is -- well, more or less, all the manufacturing is moving, is moving to China and later, perhaps, it might be India as another competitor. But it's a consequence of that; how shall we deal with it? How does it affect our economies and how does it affect our consumers? How do we react if and when we recognize that China does not fully respect the rules, to put it very -- to put it very mildly?

With a joint effort to convince China that it is in China's interest to fully respect -- to be more useful than the individual approaches which we have used, whatever the kind of impression that we have discussed. And of course, we want to discuss it against the background of growing uneasiness and uncertainty in our societies, how to deal with China. And I think everybody around the table today was a strong defender of open markets and free trade, but we made it very clear, has to be based on fair and equal rules and it has to be a level playing field and that has to be achieved in cooperation with China.

So that was -- there were more, but I cannot tell because it was supposed to be a little bit confidential, but I found it -- as an instrument, I found it very important; that is, not discussed as it normally is discussed during the summits, five minutes each side, but in some depth, with contributions from different sides, with a contribution from our side, from Peter Mandelson, the Trade Commissioner, or Charlie McCreevy, the Commissioner for Financial Services, for me, responsible for enterprises and industry, on the American side --

If anyone knows more about this talismanic confidential instrument that's supposed to whip China's trade practices into shape, I'm all ears. Meanwhile, what follows is Deutsche Welle with more coverage of the China-bashing session attended by various bigwigs:

The United States and the European Union joined forces this week in a bid to "convince" China that it would be in its best interest to abide by the rules of international trade.

The China "challenge" was the main focus of the first meeting Friday of the Transatlantic Economic Council created at the US-EU summit in April, said European Commission Vice President Gunter Verheugen, who co-chaired the meeting with US President George W. Bush's economic advisor Allan Hubbard.

The debate, Verheugen told reporters, focused on "how does it affect our economies, how does it affect our consumers. How do we react if and when we recognize that China does not fully respect the rules, to put it very mildly?"

"Would a joint effort to convince China that it is in China's interest to fully respect the rules be more useful than individual approaches which we have used? That is the kind of question that we have discussed," the EU official added.

Hubbard said how China deals with international trade has wide-ranging effects.

"When China does not follow intellectual property rules and regulations, that affects not only the US; it affects Europe. When China is an export-oriented economy, an economy that encourages local consumption, domestic consumption, that affects both our economies. When they peg their currency, that affects both economies," he said.

Also attending the breakfast meeting were US Treasury Secretary Henry Paulson, US Commerce Secretary Carlos Gutierrez, US Trade Representative Susan Schwab, EU Commissioner for Trade Peter Mandelson, and EU Commissioner in charge of the Internal Market and Services Charlie McCreevy.