EU and China pledge cooperation, but differences remain (2nd Roundup)

Oct 6, 2010, 19:44 GMT

Brussels - The European Union and China vowed to boost their cooperation Wednesday at a summit in Brussels, but failed to narrow the gap over key issues such as China's currency policy and the EU's reluctance to award the Asian giant market economy status.

The EU sees China as a potential strategic partner in Asia, and is eager to boost its influence in Beijing, while China sees the EU as a major market and a source of modern technologies.

'The EU and China have commonalities but also differences of approach. This should not impede our joint will to bring the relationship to a higher level,' EU president Herman Van Rompuy and EU commission president Jose Manuel Barroso said after the talks.

Chinese Premier Wen Jiabao said that the summit, the thirteenth of its kind, should have moved to make progress on concrete problems.

'Between China and the EU, there is still a number of major issues that have been unresolved for a long period of time. This is not in keeping with the fundamental interests of both sides,' he said in an opening statement broadcast from the summit room.

But diplomats said that the leaders made little progress on the main points of contention, while the leaders themselves cancelled plans to hold a press conference after the meeting, saying that they had run out of time.

Ahead of the summit, diplomats had said that the EU's key concerns were China's exchange-rate controls and its policy of limiting state contracts to Chinese firms.

The EU wants China to open up public tenders to European firms and live up to promises, made in June, to let the yuan move more freely.

Van Rompuy and Barroso said they stressed 'the need for a level playing field in China for our businesses (and) the importance of improved market access, a better environment for investment, more effective enforcement of intellectual property rights and the opening up of public procurement.

They also mentioned 'the importance of rebalancing global growth and reducing global imbalances,' avoiding a direct reference to the value of the Chinese currency.

Three days of talks, first in an EU-Asia summit on Monday and Tuesday and then in the EU-China summit, produced no movement, with officials saying that both sides stuck to their positions throughout.

China, meanwhile, wants the EU to award it market economy status and drop an arms embargo it imposed 21 years ago, after the June 1989 massacre of pro-democracy demonstrators in Tiananmen Square.

Again, the summit failed to produce a breakthrough on either issue, diplomats said. The arms embargo was, in any event, imposed unanimously by all the EU's members, and would therefore require unanimous approval by all members for cancellation.

However, both sides did pledge to work together, praising one another for their respective achievements during a series of political, cultural and business meetings.

The two sides must 'work together to overcome the global challenges of today and tomorrow ... With great power comes great responsibility,' said the head of the EU's executive, Jose Manuel Barroso, in his opening remarks to the summit.

Leaders discussed improving cultural ties, and witnessed the signature of agreements establishing 2011 as the year of cooperation on youth issues and setting the stage for more cooperation on issues related to the world's oceans.

'Different geographies have nurtured a variety of cultures, each with unique features and attributes. They are like the shining stars in the sky, adding radiance to each other and illuminating the vast universe,' Wen told a meeting of cultural leaders.

China is the EU's second most important trading partner, after the United States, and a key player in world negotiations on issues ranging from climate change to economic reform.

The EU is keen to enlist Chinese support for its policies on climate change and development. But the two sides have regularly clashed over accusations of trade protectionism and issues of human rights, as well as the currency question.

Read more about China

Read more about EU Diplomacy