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Insights | EU-China trade has significant growth potential Release date: 2021-02-20    Source:Global Times

According to Joerg Wuttke, president of the European Union (EU) Chamber of Commerce in China (EUCCC), the opening up of the services sector and more pro-trade measures could help EU businesses as well as Chinese enterprises further expand their growth.

In an interview with Xinhua on Feb 18, Wuttke reacted to the EU statistical office Eurostat's announcement on Feb 15 that China overtook the United States as the EU's top trading partner for the first time last year. Despite the impact of the COVID-19 pandemic, the EU and China have both seen an increase in exports to each other's markets.

Wuttke said he saw opportunities for both sides to further boost bilateral trade ties.

"We need to keep in mind that the US remains the EU's number one trading partner when you include services," he said, adding that this really highlights the untapped potentials of EU-China trade.

"The current headwinds include decoupling dynamics, politicized trade, import bans and export controls," he said. "Although the underlying economic forces for trade between the EU and China remain strong, we cannot take it for granted that it will continue to be that way indefinitely."

The EU's imports from China in 2020 jumped by 5.6 percent year-on-year to 383.5 billion euros ($463 billion), Eurostat said, while exports grew by 2.2 percent to 202.5 billion euros. At the same time, the EU's trade with the US saw a substantial decline in both directions, according to Eurostat.

In December last year, China and the EU concluded their seven-year negotiations on a Comprehensive Agreement on Investment (CAI). The two sides also signed an agreement on geographical indications, which is likely to come into force on March 1, 2021.

"If ratification can be achieved, we hope that there will be the political will to go beyond the implementation of the agreement as it stands, and to continue reforming the Chinese economy to benefit not only EU businesses but also competitive and innovative Chinese private enterprises," Wuttke said.

"The current situation could act as the EU's 'Sputnik moment'. Obviously, the focus should not be Moon-bound endeavors, but artificial intelligence, biotechnology and information and communication technology. After all the EU is still an engineering superpower," he said.