THE European Union is to launch a debate this week on the contentious issue of granting China "market economy status" from December, which Beijing says is its right after joining the World Trade Organisation 15 years ago.
EU stuck in difficult spot in granting 'market economy status' to ChinaTHE European Union is to launch a debate this week on the contentious issue of granting China "market economy status" from December, which Beijing says is its right after joining the World Trade Organisation 15 years ago.
The coveted status would make it more difficult for Europe to impose anti-dumping duties on cheap Chinese imports, changing the criteria for determining a fair price.
A study by a group of 25 European manufacturing federations estimates the European Union could lose up to 3.5 million jobs if it removes its trade defences against China designed to stop the flood of cheap imports, reported Reuters.
The bloc's final decision, taken together with EU governments and the European Parliament, will set it on a collision course either with Beijing or with its own manufacturers and with Washington.
Neither see any obligation to treat China's heavily state-shaped economy as a market economy.
All signs point to the European Commission accepting China as a market economy while seeking to keep trade defence measures for a transition period, which could appeal to sectors such as steel, chemicals or textile makers.
This could take the form of maintaining existing duties until their natural expiry - typically five years - and potentially raising duties imposed for illegal subsidies.
Chinese officials have said they could show flexibility in allowing a transition period for particular European industries.