Trade: China’s red tape costing EU €21 billion

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European firms are losing out on major business opportunities in China due to protectionist policies pursued by the Chinese government, according to Dutch centre-right MEP Corien Wortmann-Kool.

MEPs last week (February 5) voted on a report urging China to remove non-tariff trade barriers, which cost European companies an estimated €21 billion per year. 

Excessive bureaucracy, an “undervalued” currency, subsidies for home-grown industry and lack of enforcement of intellectual property rights (IPRs) hinder full market access for many EU companies, the report says. 

Corien Wortmann-Kool (EPP-ED), who served as the Parliament’s rapporteur on the issue and is vice-chairwoman of the international trade committee, said doing business in China remains complex for EU firms, but noted that Chinese companies have access to European procurement markets. 

“China is very creative in inventing non-tariff barriers. It is virtually impossible for EU companies to operate in its public procurement market, whilst the EU public procurement market, currently worth some €1,900 billion, is already largely open to Chinese companies,” Wortmann-Kool said.  

“My report calls for a level playing field on both sides in this matter and we want more EU presence and assistance, especially for SMEs,” she added. 

The report also highlights other trade-related tensions between the EU and China, including counterfeiting, quality and safety standards. 

The Parliament backed Wortmann-Kool’s proposal to create a vice-president of the European Commission responsible for EU-China trade and economic relations in order to establish effective high-level negotiations. 

China has emerged as Europe’s second largest trading partner. In 2007, Chinese exports to the EU (worth some €231 billion) grew by 18.7%. The EU’s trade deficit with China currently stands at €160 billion and continues to rise. 

Human rights, environmental, sustainable development and social issues are also covered in the report, which was adopted by a large majority of MEPs. 

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