EU and China want to establish trade monitoring mechanism

ANDthis monitoring mechanism was agreed during a meeting in Brussels between Chinese Trade Minister Wang Wentao and European Trade Commissioner Maros Sefcovic.

In a joint statement released during the meeting, the two parties stated that it was necessary “to respond to the challenges that are affecting the commercial relationship” and agreed to “seek practical solutions” to do so.

“ During the meeting, [the two parties] also agreed to establish a monitoring mechanism to exchange relevant data, monitor trade flows and support technical work to improve transparency, strengthen mutual trust and manage trade frictions” according to the statement.

The two parties also agreed to work together in four areas: “trade and investment balance, export controls, intellectual property rights and the reform of the World Trade Organisation”, to be assessed in the framework of a visit by the European Commissioner for Trade to Beijing in October.

At a press conference outside this meeting, Maros Sefcovic considered that these two decisions are “the main points” to be retained from this meeting, stating that China and the EU are “understanding” and expressing their conviction that dialogue will bring “tangible results”.

“Of course everything will not be solved, not all problems will be fixed. However, we believe that between now and October, our teams have enough time to achieve concrete results,” he said.

Asked specifically what is the usefulness of this joint monitoring mechanism, as the EU already has such a mechanism, Sefcovic considered it a “very important tool” because it will allow the EU and China to work on the basis of “same statistics and figures”.

“ We can, for example, identify a sudden increase in imports into the EU and, when this increase exceeds certain alert levels, so-called yellow or red levels, there will immediately be a political dialogue to respond to these situations. So far, we have no such mechanism,” he said.

Sefcovic reiterated that the EU considers it necessary to rebalance the trade relationship between the two parties, stressing that China's exports to the bloc continue to increase, while Europeans are losing more and more market shares in China.

“ This trend is not sustainable and maintaining the current situation is not an option. The EU remains open to business, but we need to defend our industrial base. That is why today’s talks, as well as those that will follow, are important: they help us avoid unnecessary tensions,” he said.

With regard to export controls, Sefcovic said that Wang has ensured that the restrictions that China currently has on the export of rare earth “will not disturb the EU supply chains”.

The European Commissioner thought today was a good day.

“ The discussion was truly constructive and I see that there is a much greater understanding of the common challenges and the situation of the EU than before,” he said.