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Chinese President Xi Jinping met with the President of the European Commission Ursula von der Leyen and President of the European Council Charles Michel for the 24th EU-China Summit in Beijing. The summit was focused on reviving stronger economic ties between China and Europe.

Held on December 7, 2023, the summit was convened at the Diaoyutai State Guesthouse in Beijing where Chinese President Xi Jinping greeted the President of the European Commission and the European Council. This was the first in-person EU-China summit since 2019.

During his meeting, President Xi emphasized that China is interested in becoming a key trade partner with Europe in fields such as technology and supply chains. He noted that since the end of last year, the China-EU relationship has shown a good momentum of consolidation and growth, and the China-EU high-level dialogues in the strategic, economic trade, green, and digital fields have been productive.

Xi urges enhanced cooperation between China and EU

Chinese leader stressed that a strong and cooperative relationship between China and the European Union is essential for the peace, stability, and prosperity of the world as he called on both sides to be partners of mutually beneficial cooperation.

“Amid the increasingly turbulent international situation, the China-EU relationship has strategic significance and implications for global peace, stability, and prosperity”, Xi said.

Chinese President Xi Jinping on Thursday called on China and the European Union (EU) to provide greater stability for the world, stronger impetus for development and more inspiration and support for global governance. https://t.co/oTKE9F7k5a pic.twitter.com/roEp91bjQ9

— CCTV+ (@CCTV_Plus) December 7, 2023

Ursula von der Leyen said her second visit to China this year underlines the importance of the EU-China relationship for European Union.

Acknowledging that the EU’s “relationship with China is complex”, she said that the two sides have a responsibility to make it work. “We agreed that it is in our joint interest to have balanced trade relations. And we need to address challenges in a world with increasing geopolitical frictions,” the European Commission president said.

Chinese Premier Li Qiang, who met the two presidents in a separate session, said China hoped the EU would be prudent when introducing restrictive economic and trade policies, and keep trade and investment markets open. “China opposes turning economic and trade issues into political or security ones, which violates the basic norms of a market economy,” Li said.

Concerns about trade deficit

The increasing trade deficit between China and the European Union was one of the main points of discussion during the summit. EU leaders conveyed their stance against China’s “unfair competition” and emphasized Europe’s unwillingness to tolerate it. The EU reports a nearly $431 billion trade deficit with China and blames Beijing’s restrictions on European businesses in China for it.

“We need to make our trade and economic relationship more reciprocal and balanced, reciprocal, and mutually beneficial,” Michel said, adding that the bloc expects China to take more concrete actions to increase market access for foreign companies.

Ursula von der Leyen said the sides discussed the root causes of their trade imbalance, from a lack of access to the Chinese market and preferential treatment to Chinese firms to overcapacities in Chinese production. “Politically, European leaders will not be able to tolerate that our industrial base is undermined by unfair competition,” she said.

Our relationship with China is complex and we have a responsibility to make it work.

Following our 24th EU-China Summit, we highlight the need for concrete progress following our discussions.

Read more about the outcome of the Summit ↓

— European Commission (@EU_Commission) December 7, 2023

China has dismissed growing concern in Brussels over the trade deficit. China’s foreign ministry director-general for European affairs Wang Lutong said in a separate briefing after the summit that China’s trade surplus with the EU was already falling.

Foreign Ministry spokesperson Wang Wenbin also commented on the EU’s complaints as he pointed out that Brussels bears responsibility for the trade imbalance as it’s stopped businesses from exporting to China. “Both sides discussed about what Brussels has been calling imbalance about bilateral trade — we don’t think China could be held accountable for this,” Wang told the media.

“It makes no sense for the bloc to impose restrictions on high-tech exports and then complain about the trade deficit,” Wang said during a press briefing one day before the summit.

What is the EU and China Trade Deficit issue?

• The European Union (EU) and China are major economic partners, engaging in trade amounting to €2.3 billion per day.
• However, the EU is increasingly concerned about the trade deficit with China, which has surged from €40 billion to nearly €400 billion over the past two decades.
• The trade deficit has doubled in the last two years, sparking apprehension among Europeans. Contributing factors to this trade imbalance include restricted market access for European companies in China, preferential treatment of domestic Chinese companies, and an excess of production capacity in China.
• In response to this concern, the EU is actively advocating for China to establish a more balanced economic relationship. This includes addressing issues related to market access and creating a more favorable investment environment for EU investors and exporters.
• While China has downplayed worries regarding the trade deficit, asserting that the gap will significantly narrow this year, recent discussions in Beijing between EU and Chinese leaders underscored a shared commitment to achieving a more balanced trade relationship.

China’s role in Russia-Ukraine war

A big focus of the EU visit was to urge Beijing to stop Chinese private companies exporting European-made, dual-use items to Russia for its military campaign in Ukraine.

Michel urged China to “engage constructively” on peace proposals by Kyiv, but EU officials gave no indication of movement on the issue of private Chinese re-exports to Russia.

In her statement before meeting the Chinese President, Ursula von der Leyen said that “as major powers in the world, the European Union and China have global responsibilities. We have a shared interest in peace and security, in the effective functioning of the rules-based international order, and in finding solutions to global challenges. That is why it is essential to put an end to the Russian aggression against Ukraine and establish a just and lasting peace consistent with the UN Charter, and, in the same vein, to do everything possible to work for a two-state solution in the Middle East.”

In today’s volatile world, the EU & China share a responsibility to work for peace and respect for the principles of the UN Charter.

More peace and more stability — good for Europe, good for the world.
#EUChinaSummit https://t.co/fEMyxYFWrD

— Charles Michel (@CharlesMichel) December 7, 2023

The EU called on China to use its influence on Russia to stop its war in Ukraine. “We recalled the need for China to use all its influence on Russia to stop this war of aggression and to engage in Ukraine’s peace formula,” she added.

However, there was no indication of substantial progress from the EU in convincing China to leverage its influence on Russia to bring an end to the conflict in Ukraine. China’s foreign ministry director-general for European affairs Wang Lutong said that the European politicians occasionally suggest that China should engage with Russia on the Ukraine issue. However, he emphasized that Russia is a sovereign nation, independent in its decision-making and Putin’s decisions are guided by Russia’s own national interests and security considerations.

Regional issues and Middle East crisis

Regional issues, particularly in the Strait of Taiwan, in the East and South China, also came under discussion. “We acknowledge the ‘One-China policy’. Regional security will also be increased if differences on the South China Sea are resolved through dialogue and in line with international law.”

On the Middle East, both sides agreed on the importance of ensuring the protection of all civilians and improving the dire humanitarian situation in Gaza. Both China and the EU affirmed their commitment to the two-state solution.

EU and Chinese leaders also discussed areas of shared interest such as climate change, health, and the expansion of renewable energy.