EU, China have much to chew over

Premier Li Keqiang heads to Brussels this week for the biannual Asia Europe meeting (ASEM) plus bilateral talks with European Union leaders. Li's visit takes place amid rising protectionism and increasing trade tensions between China and the United States, as well as between the EU and the US. The EU has not suffered as heavy a blow as China from US tariffs but EU leaders are still lobbying to get the White House to lift 25 percent tariffs on European steel and aluminum exports imposed on spurious "national security" grounds.

The trade issue is highly complicated. China and the EU are both opposed to protectionism but the EU shares some of the US concerns about China. EU leaders will thus press Li for his views on the further opening of the Chinese economy and Beijing's ideas on WTO reforms. The embattled Geneva-based global trade organization is facing a struggle for survival with its dispute-settlement system on life support. The G20 trade ministers met in Bali, Indonesia on Thursday, but there is little sign of any compromise coming from Washington.

Meanwhile EU-China trade continues to thrive with on average over 1 billion euros of goods and services traded each day. Given that China is the EU's biggest source of imports and its second-biggest export market, there are inevitably some disputes. On the EU side, there are concerns about a lack of transparency, industrial policies and non-tariff measures that discriminate against foreign companies, strong government intervention in the economy, unequal access to subsidies and cheap financing, and poor protection and enforcement of intellectual property rights.