EU to China: Open Economy Faster 09/19 06:09
BEIJING (AP) -- A business group urged China on Tuesday to carry out
promises to open its economy and warned that inaction might fuel a backlash
against free trade amid mounting U.S. and European criticism.
The European Union Chamber of Commerce said in a report that Beijing is
backtracking in some areas, including by imposing new restrictions on food
imports, express delivery and legal services. It proposed hundreds of possible
changes to open the state-dominated economy wider or simplify rules in fields
from cosmetics to medical devices.
"The current lack of reciprocity in market access is becoming politically
unsustainable," the European chamber president, Mats Harborn, said at a news
conference. "We are worried that if this is not quickly changed, there will be
a backlash against economic globalization."
The chamber's American counterpart and other groups have issued similar
Beijing faces mounting complaints from Washington and the European Union
about its trade surpluses and barriers to foreign acquisitions of Chinese
assets while its own companies are buying foreign brands and technology.
On Monday, the U.S. trade representative, Robert Lighthizer, complained in a
speech in Washington that Chinese efforts to create industrial champions and
induce foreign companies to hand over technology threaten the world trading
President Xi Jinping, who took power in 2012, and other leaders have
promised to give market forces a bigger role, treat foreign and Chinese
companies equally and reduce the dominance of state industry. But reform
advocates complain little has been done to carry out those pledges.
A foreign ministry spokesman, Lu Kang, defended Beijing's trade record and
said it has abided by its market-opening commitments under the World Trade
"China stays committed to the opening up and reform and lets the market play
a decisive role in the allocation of resources," Lu said at a regular briefing.
China is a key market for autos, aircraft, smartphones, cosmetics and other
goods. But Beijing bars foreign companies from fields including finance,
telecoms and utilities. In others, companies are required to work through local
partners that might become competitors.
The European chamber report noted the Organization for Economic Cooperation
and Development ranks China 59th out of 62 countries in terms of openness to
foreign direct investment.
It appealed for changes in fields from aerospace to cosmetics, including
opening more industry segments, easing limits on foreign ownership stakes in
companies and simplifying regulation.
The president of the European Union's governing body last week announced
plans to introduce a screening mechanism for foreign investments --- a measure
widely seen to be directed at Beijing.
"It seems like it is a well-balanced proposal so far, and we look forward to
seeing the discussion," Harborn said.
Also last week, U.S. President Donald Trump blocked a Chinese-financed
purchase of a U.S. semiconductor maker, prompting suggestions Washington might
tighten scrutiny of future deals.
American authorities also are investigating whether Beijing should face
penalties for pressuring companies to hand over technology in exchange for
market access. A survey earlier by the U.S.-China Business Council found 20
percent of companies that responded said they were asked to transfer technology
within the past three years.