China denies being 'root cause' of EU economic woes after trade talks

China's foreign ministry stated on Tuesday that the country is not the "root cause" of the issues facing the European Union's economy, following talks in Brussels aimed at averting a damaging trade war.

Trade Imbalance Raises Concerns

China's large — and growing — trade surplus with the 27-nation bloc has increasingly raised concerns across Europe, putting pressure on Brussels to protect local industries.

After talks on Monday with visiting Chinese Commerce Minister Wang Wentao, EU Trade Commissioner Maroš Šefčovič issued a stark message that "the status quo is not an option."

Beijing's Response

Asked about the discussions on Tuesday, a spokesman for Beijing's foreign ministry said that "China and the European Union are partners, not rivals."

"The root causes of the issues facing the European Union do not lie with China," Guo Jiakun told a regular news conference.

"The key to resolving economic and trade issues between the two sides lies in deepening cooperation and achieving common development," he said.

He added that China was ready to "strengthen communication and consultation with the EU side [and] properly handle trade differences in a constructive manner."

Next Steps

Šefčovič and Wang plan to meet again in October in China.

Broader Context

Brussels fears it will lose certain industries entirely if it does not act against a glut of inexpensive goods made in China that threaten manufacturers in Europe.

Europe insists on the need for a level playing field, pointing out that Chinese firms have an unfair advantage because of massive state subsidies.

Apart from the trade imbalance, other issues include Beijing's stringent export controls on rare earth elements essential to the modern economy, introduced last year.