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EU requests WTO consultations with China on export restrictions
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By Wang Ke
China.org.cn staff reporter

The European Union requested WTO consultations with China regarding China's export restrictions on a number of key raw materials on Tuesday.

According to the EU Embassy to China in Beijing, the European Union has repeatedly raised the issue with China in recent years without success, and now hopes to use the WTO consultation process to arrive at a mutually satisfactory solution with China.

Press officers from EU Embassy in Beijing told China.org.cn that the EU Trade Commissioner Catherine Ashton had complained about China's measures.

She said that Chinese restrictions on raw materials will have a negative impact on competition and may increase global prices.

European industries have expressed concern for a number of years on export restrictions – quotas, export duties and minimum export prices – which China applies on key raw materials such as yellow phosphorous, bauxite, coke, fluorspar, magnesium, manganese, silicon metal, silicon carbide and zinc.

Dependent on imports of raw materials, the EU industries are therefore vulnerable to fluctuations in world commodities markets. The EU delegation in China said that export taxes could accentuate EU's vulnerability and might reduce their industries' competitiveness, and in some cases could even cut industry off from essential inputs.

The EU worries that downstream industries in China have access to cheaper materials than their competitors outside China. The chemical, steel and non-ferrous metal industries, as well as the downstream clients, are the main sectors concerned.

"The restrictions might make things even more difficult for our companies in this economic downturn. I hope that we can find an amicable solution to this issue through the consultation process," Catherine Ashton said.

China has re-emerged as the world's fourth-largest economy and third-ranked exporter, but also as an increasingly important political power. EU-China trade has increased dramatically in recent years and now totals over EUR 300 billion. China is now the EU's 2nd trading partner behind the USA and the biggest source of EU imports. The EU is China's biggest trading partner.

The consultations requested on Tuesday focus on a first batch of measures and products. The EU concerns are not limited to these and work on others will continue, with the possibility of further action still open.

Reports from Xinhua News Agency Tuesday revealed that the United States also requested consultations with China on this issue.

(China.org.cn June 24, 2009)

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