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EU feels heat in China, US trade row

AFP  |  Brussels 

reached out for Europe's support in its bitter trade war with the US, leaving the EU at risk of getting entangled in a conflict with repercussions around the

The is caught in a bind as it too shares many of Washington's grievances with Beijing's trade practices, but is also under a threat of protectionist measures ordered up by US

In a rare diplomatic plea, today called on the EU to take a joint stand against US protectionism as Trump warned that he could slap another USD 100 billion (86 billion euros) of extra tariffs on China's imports.

"and the EU... should take a clear stance against protectionism, jointly preserve the rules-based multilateral trade order, and keep the global economy on a sound and sustainable track," Zhang Ming, the of the to the EU, said in a statement sent to AFP.

"This is a joint responsibility of and the EU. We must act together to make that happen," Zhang said.

The EU declined to respond directly to the envoy's invitation, insisting only that trade conflicts should be resolved at the Trade Organisation, the Geneva-based body set up to resolve disputes.

The bloc is "firm in the belief that free and fair trade is one of the most powerful engines for growth, supporting millions of jobs and contributing to prosperity," said in a response to AFP.

The EU and the US themselves nearly descended into a trade war after Trump in March threatened to impose tariffs on and aluminium imports that would, if confirmed, punish European manufacturers.

But Trump granted a last-minute exemption, giving EU negotiators until May 1 to come up with a solution to unfair trade policies alleged by the US leader.

The Europeans reject Trumps allegations, which have mostly circled on Germany's auto industry, and prepared a list of counter-measures in case the US reverses course and slaps on the tariffs.

The European Commission, which handles trade for the EU member states, said contacts with the US would continue next week, though French has angrily said that should refuse to negotiate "with a gun to your "

Complicating matters, European leaders are largely in agreement with Trump that fails to play fairly when it comes to international trade, not only for metals exports, but also market access for European companies and respecting intellectual property.

Many Europeans also rail against cash-flush Chinese tycoons that have snapped up European companies, sports clubs and airports, all while foreigners are barred from investing in equivalent industries in

ranked 84th globally -- behind and -- in the Bank's ease of doing business index for 2016, and second to last in an report on the restrictiveness towards foreign investment.

"The problem is the method," a European told AFP, when asked about Trumps hardball approach to

"The US is completely ignoring WTO rules. Until now they at least kept up appearances, but no longer," the source said.

Against China, the Europeans have always chosen the soft approach -- through lures of investment deals and closer cooperation -- said Fredrik Erixon, of the

But this strategy will remain "fruitless, partly because there isnt any degree of confrontation, there is no bad cop next to the good cop and we need that," he said.

However he added: "While confrontation with is necessary, Trump's way of doing it has too much collateral damage and does not deal with the issue in a rational way.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, April 06 2018. 21:55 IST
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