Debt crisis hangs over Eu-china meeting

BEIJING — Europe’s crippling debt crisis and a series of thorny trade issues will weigh on the agenda as European Union and Chinese officials meet in Beijing on yesterday.

The third EU-China Strategic Dialogue will help pave the way for the next top-level summit in Brussels this year, and comes as European countries struggle to find answers to end their financial woes.

Europe is China’s biggest trading partner and Beijing is a major holder of European debt, so China has viewed the eurozone crisis with alarm.

China had in the past said it was looking at ways it could contribute to bailout funds to help Europe, but such help has not materialized.

However the Asian giant, the world’s biggest holder of foreign exchange reserves, last month pledged $43 billion to the International Monetary Fund’s new crisis fund to help global financial stability amid the eurozone shock.

“China has offered a variety of assistance to Europe within its capability and pledged continuous support to (the) EU’s endeavour to achieve economic recovery and stable growth,” the state-run Xinhua news agency said Monday.

“China believes a united, stable and prosperous Europe serves the interests of the world,” it said in a commentary.

The world’s number two economy and the 27-country bloc have lately locked horns on trade issues, including China’s grip on rare earths used in high technology and an EU carbon tax which Chinese airlines have refused to pay.

The EU has joined the United States and Japan to accuse China of unfairly choking off exports of rare earths and they have turned to the World Trade Organization to resolve the escalating dispute.

China’s aviation watchdog in February barred Chinese airlines from participating in the so-called Emissions Trading Scheme, though there are hopes the EU might postpone the controversial carbon tax.