The European Union (EU) is seeking constructive dialogue with China to solve the issue of trade deficit, European Commission President Jose Barroso said here on Thursday.
We "should raise this matter in our dialogue with the Chinese authorities, of course in a constructive spirit," Barroso told reporters ahead of an EU informal summit.
As finance ministers and central bankers from the Group of Seven (G7) leading industrialized nations were set to meet in Washington Friday, Barroso said the EU would avail itself of the occasion to discuss the issue in "outreach session" with China, a non-G7 member.
"I hope that the G7 can make some progress on this issue and this is certainly an issue that we are going to raise in our dialogue with China," Barroso said at a joint press conference together with European business leaders, trade union representatives and Portuguese Prime Minister Jose Socrates.
Barroso said Socrates, who is hosting the EU summit as his country holds the EU presidency, will also travel to China in November, with the issue of trade deficit on the agenda.
Expressing concerns over the trade deficit with China, Barroso said he had received commitments from Beijing but he wanted to see more concrete results.
In an unexpected move, the EU finance ministers failed to take a tougher stance against weakening U.S. dollar, but mounted pressure on China last week, urging the emerging economy to do more to make its currency RMB more flexible.
The EU claimed RMB was undervalued, thus giving an unfair advantage to Chinese exports into the 27-nation bloc and contributing to the huge trade deficit.
According to a recent report of the Bank for International Settlements, the nominal effective and real exchange rates of RMB has risen 6.19 percent in the first nine months of this year. It hit its highest level since China's exchange rate reform in 2005 and registered the largest appreciation among world major currencies.
At the same press conference, Ernest-Antoine Seilliere, head of the European employers association Business Europe, called for eurozone members to politically intervene to prevent the continuous appreciation of the euro.
"We are asking for political intervention at the level of the world leaders on the behalf of the euro currency," he said.
The euro hit an all-time high Thursday of 1.4310 dollars, a level described by Seilliere as over a pain threshold.
On the sidelines of the EU informal summit in Lisbon, Italian Prime Minister Romano Prodi told reporters that he was confident that the EU and China can find a solution to the trade deficit in the long run.
"If we agree on the rules, on the anti-dumping rules, on the environmental rules, China will become a positive force in the world economy," Prodi said to journalists.
Prodi again expressed his concerns about the strength of the euro. He had accused the United States of looking only after its "domestic interests" in its exchange rate policy.
Source: Xinhua
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