EU trade chief seeks “tangible outcomes” in China talks

The European Union's top commerce official said it was crucial to achieve "tangible outcomes" in trade talks with China set to wrap up in Beijing on Friday.

The negotiations follow months of rising tensions between the 27-nation EU and the Asian powerhouse that risk escalating into a full-blown trade war.

"Building on three intensive months of engagement, we're working hard to rebalance EU-China trade," Maros Sefcovic said late Thursday after meeting Chinese Commerce Minister Wang Wentao in Beijing.

"It's crucial that the first phase of our talks under the Trade and Investment Consultations delivers tangible outcomes," Sefcovic said on social media, posting a photo together with Wang.

Sefcovic had said earlier Thursday that the EU's trade deficit with China, running at around one billion euros ($1.1 billion) every day, was "unsustainable".

Cheaper products coming from China have strangled European industry, resulting in tens of thousands of job losses across the continent.

Many in Europe accuse China of unfair trade practices, including supporting firms with huge subsidies, price-dumping and currency manipulation.

But Europe can ill afford to anger China.

Beijing could throttle supplies of vital items such as rare earth minerals or throw up barriers to European exports to China.

The stakes are also high for President Xi Jinping, however, with China heavily reliant on exports to compensate for its weak domestic economy.

The EU parliament's trade committee chief, Bernd Lange, said ahead of Sefcovic's trip that this "economic crisis in China" gives the bloc "bargaining power".

There is some "nervousness" during the talks among members of the European Union Chamber of Commerce in China, according to Adam Dunnett, the lobby's secretary general.

European companies with local operations "recognise the importance and the real issue of the outstanding trade imbalance", Dunnett told AFP on Friday in Beijing.

"They fully support that that needs to be addressed, but they want it to be done in a proportionate, specific and negotiated way so that we can manage the overall relationship," he said.

"Things could escalate," he warned, adding it was "foolish" to dismiss the real risk of a full-scale trade war.

Among the top issues facing European companies in China is complicated access to critical rare earth minerals under new rules imposed by Beijing last year in retaliation against tariffs announced by US President Donald Trump, said Dunnett.

Despite some improvement in gaining approvals for rare earth exports, Dunnett said many companies still encounter problems -- some saying they "don't know why".

"Having a bit more transparency and predictability around that" is a key deliverable from this week's talks, he said.