China to get "market economy status"?

China as a member of the World Trade Organisation (WTO) seeks to obtain a new status as a “market economy” in 2016. This “market economy status” (MES) would have a substantial impact on EU’s economic relationship with China. BUSINESSEUROPE today published its position paper on the subject.

Talking about what is at stake Markus J. Beyrer, Director General of BUSINESSEUROPE said: “There are deep concerns within major parts of the European business community about what the expiry of Section 15 subparagraph (a)(ii) of China’s Accession Protocol to the WTO could mean for the EU anti-dumping procedures and industrial competitiveness. The EU should therefore maintain effective trade defence instruments that take the real market situation in China into account”.

European business believes there is no requirement to automatically grant MES as a direct consequence of the expiry of Section 15 subparagraph (a)(ii) because the remainder of the subparagraph, parts (a) and (a)(i), remains in place."

"Therefore the question of market economy status (MES) should be treated in accordance with WTO and EU rules and be based on its own merits”.

BUSINESSEUROPE also stresses the need for the EU to coordinate with and take account of the positions of other major WTO members such as the United States. This is important to avoid trade diversion of Chinese exports towards Europe as a consequence of differing views among key trading partners.

“It is in the interest of European business that the EU strives for a sound and balanced economic relationship with China. To achieve this, it is important that the EU proactively engages China through all available channels”.

China is a major trading partner of the EU and our bilateral relationship is very important both in terms of trade as well as investment.

The definition of a balanced common position by all BUSINESSEUROPE’s member federations is a significant contribution to the European debate on this complex issue. Therefore BUSINESSEUROPE trusts that industry’s views will be fully taken into consideration throughout the EU decision-making process during this and next year.