Trade frictions cast shadow over EU-China business summit

Politicians played down trade frictions while executives talked of bribes and basketball at this year's surreal EU-China business summit, PublicServiceEurope.com reports

Readers of the European Union's Official Journal might think there is a trade war brewing between the 27-member bloc and China. Since July, the European Commission has slapped anti-dumping duties on Chinese aluminium foil imports, coated steel products, lever arch mechanisms and tartaric acid. Investigations, meanwhile, have been launched into suspicions that Chinese exporters are dumping photovoltaic cells and telecoms equipment on the European market.

"People are getting more sensitive about products from China," said Zou Changzheng, chief executive of China's Baosteel Europe steel group. Anti-dumping concerns were running particularly high in the steel industry, Changzheng told the EU-China business summit in Brussels. Frustrations with patent registrations, and intellectual property in general, continued to weigh on the bilateral relationship, attendees heard.

"Tiny topics will lead to a relationship without mutual trust," warned Leo Sun, head of the Brussels office for information technology specialist Huawei, one of the summit's sponsors. Over coffee before the event opened, Sun's colleagues speculated that evidence collected by the commission in the telecoms probe was poor.

"We are having trouble getting working visas," complained Bi Hua, chief executive of Greatview Aseptic Packaging Company. Greatview wanted to bring over "instructors" for the entire start-up phase of its new factories –  around a year – but European authorities were only giving out three-month visas, he said. Hua praised the attitude of his Chinese workforce, who in general "wanted to work more hours" than their European counterparts. Arnaldo Abruzzini, secretary general of trade association Eurochambres, had one message for European leaders: "Protectionism doesn't help".

Commission president José Manuel Barroso downplayed talk of tension.  "In such an intense relation, which is growing by the day, it is only natural that some problems may arise," he said. "These disputes are a very limited part of our bilateral trade." So-called trade defence instruments reportedly "cover only around one per cent of the EU total imports from China".

Chinese premier Wen Jiabao, attending the summit for the 10th and final time, listed the opportunities awaiting European industry in his homeland while his large entourage applauded from close to the podium. They had commandeered the front rows by placing stickers in Mandarin on the backs of the seats occupied by those who were at lunch, forcing B-list attendees to retreat to the back of the conference hall. Twenty minutes before Jiabao's speech, the hall went into lockdown. Security was ostensibly tight; participants were required to provide two forms of identification, though a journalist from newswire Bloomberg said no-one had checked his bag or examined the bottle of cough syrup he was carrying.

European leaders cow-towed to Chinese custom. Jiabao was presented with a glass horse – he was born in the year of the horse, evidently an auspicious start for any leader according to Chinese astrology. Karel De Gucht, the Brussels commissioner for trade, sat next to Barroso on the podium but oddly did not give a speech. According to one conference organiser, he was merely there to ensure parity in numbers between the Chinese delegation and the European delegation.

Over the networking lunch, young Chinese girls in miniskirts worked the atrium. They were "project managers" from a Brussels university, they said. Everyone was invited to an upcoming seminar on "technology transfer". Middle-aged European businessmen shifted uncomfortably.

A rail freight executive from Lithuania boasted that his "bullet train" could ship goods from Peking to Antwerp in 20 days – half the time taken by a container vessel departing from Shanghai. Frozen chicken wings were one of the main cargoes, he said. Another importer said he regularly bribed Chinese officials to ensure smooth transit. "It's no different to Russia, or Brazil, or South Africa," he said. "In fact in Russia it's worse". High value-added merchandise meant larger bribes.

A Belgian telecoms executive had just returned from a three-month stay in China, at his company's research and development facility. "It was like a huge campus, and it had five basketball courts," he said with enthusiasm. "I'm tall so I thought I would do OK. But they're really good over there". Basketball is popular in China because it's considered a clean sport, unlike corrupted football, said another executive.

A slightly surreal atmosphere pervaded the whole summit. The hostesses manning the front desk of the Egmont Palace in the royal district were obliged to wear wide-brimmed black hats – inappropriate attire for cloudy Brussels. They were no doubt made in China.