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EU Denial of China Market Economy Status May Have ‘Very Negative’ Effect

© Flickr / Guillaume P. BoppeEuropean Commission
European Commission - Sputnik International
The EU’s rejection of China’s Market Economy Status (MES) would be a ‘strategic mistake’ that can lead deterioration of political relationship between EU and China, according to Luigi Gambardella, president of China-EU, a business-led association.

The EU lawmakers were opposed to recognizing China's MES as set out in global trade rules during a non-legislative resolution on Thursday, Xinhua news reported.

“China joined the World Trade Organization (WTO) in 2001. Under the country's accession protocol, China will automatically transition to market economy status for Europe by Dec. 11, 2016.”

Workers check steel products at a factory in Dalian, Liaoning Province, China, March 30, 2016 - Sputnik International
EU Refusal of China's Market Status is 'Disguise of Protectionist Politics'
However, if the EU denies MES to China, there is a risk that China will retaliate and the EU economy will face dire consequences and uncertainty.

“It could threaten the positive outcome of the ongoing negotiations for the bilateral investment treaty and the potentiality to conclude a FTA between China and the EU — which according to Commission estimates could raise European prosperity by 250 billion euros,” the president said.

“Moreover China is the first, and only, non-EU country which has so far generously committed to invest in the Juncker Plan,” he stressed. Closing the door to China may thus have "very negative" effect, the agency reported.

He further stressed that, “With China, what needed is more dialogue, not less. We need to find win-win solutions rather than start a new fight. Today the key word is cooperation,” he told Xinhua.

Earlier this year, Chinese Foreign Ministry spokesman Hong Lei urged the EU to obey the WTO rules and stop its unfair treatment towards China.

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