Truce between China – EU trade war

China yuan
China yuan

The European Commission has selected to defuse, at least partly, the long trade dispute with China on telecommunications, withdrawing the relevant application and proposing to conduct negotiations in the coming months in order to fully resolve the issue. Commissioner for Trade, Mr Karel de Choucht said that the commission would terminate the investigation on unfair Chinese competition in the importation of equipment for mobile phone networks with an annual turnover of 1 billion euros. However, the commission will continue to explore the theme of illegal government subsidies for equipping mobile networks, although it will not begin a formal investigation as long lasting negotiations with Beijing.

China yuan

China yuan

I would like to reach to a solution until the next meeting of the Economic and Trade Committee with China in late June, early July, said Mr. de Choucht. The two main Chinese export companies in the field is the company Huawei, the number two telecommunications equipment manufacturer in the world, and the smaller company ZTE. Commissioner de Choucht explained that it is belief that the essence of the problem with the Chinese competition is found illegal state subsidies. The change in attitude of the European Commission comes after last week China has decided to close its investigation on European imports of wine and polysilicon, a substance used in the manufacture of solar panels and noted a few days before the visit of the Chinese President, Mr See, in Brussels.

EU flag

EU flag

The investigation on imports of Chinese equipment manufacturing mobile networks was decided in May 2013, at a time of significant trade tensions between Europe and China because of the decision of the European Commission to impose tariffs on Chinese imports of solar panels by 21 billion euros a year. Eventually a compromise was reached last July with average tariffs halved.

By Nicole P.

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