EU-Chinese Trade Relations

Table of Contents

  List of graphics  2

  List of tables  2

  List of abbreviations  2

1.  Introduction  3

2.  EU and China  3

2.1.  General Facts  3

2.2.  Geography and History  4

2.3.  Economy  6

3.  EU-Chinese Trade  8

3.1.  History  8

3.2.  Trade Statistics  9

4.  Special Trade Issues  13

4.1.  Technological Cooperation  13

4.2.  Textile Conflict  14

4.3.  Intellectual Property Rights  15

5.  Conclusion  16

  Bibliography  17

  Chinese Foreign Trade Hannes Mungenast Page  1

List of graphics

  Graphic 1: Map China  5

  Graphic 2: Map EU  6

  Graphic 3: EU-China trade  9

  Graphic 4: EU imports from China by product grouping  11

  Graphic 5: EU exports to China by product grouping  11

  Graphic 6: EU trade in services with China  12

  Graphic 7: EU-China FDI  12

  List of tables  

Table 1:  General Facts  4

Table 2:  Economic Facts  7

  List of abbreviations  

  ASEAN Association of Southeast Asian Nations  

  est estimation  

  EU European Union  

  FDI Foreign Direct Investment  

  GDP Gross Domestic Product  

  GPS Global Positioning System  

  ITER International Thermonuclear Experimental Reactor  

  NAFTA North American Free Trade Agreement  

  OECD Organisation for Economic Cooperation and Development  

  USA United States of America  

  WTO World Trade Organization  

  Chinese Foreign Trade Hannes Mungenast Page  2

1. Introduction

This paper is the final paper for the course Chinese Foreign Trade. The EU-Chinese trade relations are a very important aspect of today’s world economy and are ex- pected to even increase in future. These trade relations are equally important for both sides and will have a strong impact on the future of both parts. This importance con- vinced me to choose this topic.

First of all, chapter 2 gives a summary of the most important aspects of trade-related statistics about China and the EU to give an overview of the two parties. In chapter 3, the most essential trade statistics will be presented. Before ending with an overall conclusion, chapter 4 will deal with some special trade issues of importance.

2. EU and China

This chapter gives an overview of the most important statistics about EU and China, which are relevant for trade.

2.1. General Facts

First of all, let’s take a look at some statistics to compare the two countries. China has with its 9.5 billions sq km more than double the size of the EU and with 1.3 billion people almost three times more inhabitants than EU. The average Chinese inhabitant is much younger than in the EU and despite of the one-child policy China is growing more rapid than EU.

The average European citizen lives six years longer than the average Chinese one. Especially with the life expectancy of women there are huge differences. The two most important politicians in China are President Hu Jintao and Prime Minister Wen Jiabao, while the most important EU-politician is Jose Durao Barroso, the head of the

EU commission.

Table 1: General Facts

Area: 3,976,372 sq km

Population: 455 million

Age Structure: Age Structure:

0-14 years: 16.3% 15-64 years: 67.2% > 65 years: 16.6% Population growth rate: 0.17%

Life expectancy at birth: Life expectancy at birth:

President of the European Com- President HU Jintao

Source: Own table using data from CIA Worldfact Book (2006)

2.2. Geography and History

China is an Eastern Asia country, bordering to several countries. The People’s Re- public of China was founded on 1 October 1949. After the reforms of Deng Xiaoping, commencing in the year 1978, China opened to the world and has become an impor- tant power in the global world.

Graphic 1: Map China

The European Union is located in Europe, consisting of 25 independent countries. This means that the EU is no country; it is a federation of independent countries. However, the EU is much more than just a free-trade association such as ASEAN,

NAFTA or Mercosur. It has some characteristics of independent nations such as its

own flag, anthem and currency. In addition, the member countries gave some legisla- tion power to the EU. About 70 per cent of all laws in Germany are based on deci- sions of the European Union. The EU was founded after World War II in 1951 and grew from six to now 25 member states.

The EU consists of the following countries:

Austria, Belgium, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Ger- many, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Nether- lands, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden and United Kingdom. In addition, Bulgaria and Romania will join the EU in 2007 and Croatia, Macedonia and Turkey have the status of a candidate country.