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China rejects EU’s trade deficit complaint

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Beijing has rebuffed a complaint by European Commission President Ursula von der Leyen over the EU’s trade deficit against China, a day before her summit meeting with Chinese President Xi Jinping, according to Politico. 

The EU bears responsibility for the trade imbalance as it’s stopped businesses from exporting to China, Foreign Ministry spokesperson Wang Wenbin said on Wednesday, responding to von der Leyen’s call on China to open up access to its market.

“If the EU on the one hand imposes harsh restrictions on high-tech exports, and on the other hopes to sharply increase exports to China, that I’m afraid doesn’t make sense,” Wang told a regular press conference.

Wang’s comment appeared to refer to restrictions on exports of the most advanced lithography tools, made by Dutch market leader ASML, that are used to print the most powerful computer chips.

He added that part of the profits generated from Chinese trade surpluses are earned by European companies with operations there. A third of EU companies’ output in China was exported back to the EU.

“The current state of China-EU trade is the result of macroeconomic environment, international trade conditions and the industrial composition of the two sides,” said Wang. “Trade figures are incapable of reflecting the share of interest between China and the EU in light of the integrated global industrial and supply chains.”

Von der Leyen on Tuesday said that European leaders “will not tolerate an imbalance in trade over the long term.”

In the months leading up to the summit, scheduled for Thursday, EU officials have been highlighting its trade deficit with China which had doubled in two years to a record €390 billion in 2022.