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Thursday, 12 May 2016 - Strasbourg
China’s market economy status

European Parliament resolution of 12 May 2016 on China’s market economy status (2016/2667(RSP))

The European Parliament,

–  having regard to the EU’s anti-dumping legislation (Council Regulation (EC) No 1225/2009 of 30 November 2009 on protection against dumped imports from countries not members of the European Community(1)),

–  having regard to China’s Accession Protocol to the World Trade Organisation (WTO),

–  having regard to its previous resolutions on EU-China trade relations,

–  having regard to Rule 123(2) and (4) of its Rules of Procedure,

A.  whereas the European Union and China are two of the biggest traders in the world, with China being the EU’s second biggest trading partner and the EU being China’s biggest trading partner, and with daily trade flows of well over EUR 1 billion between them;

B.  whereas in 2015 investment from China into the EU for the first time exceeded investment from the EU into China; whereas the Chinese market has been the main engine of profitability for a number of EU industries and brands;

C.  whereas, when China joined the WTO, an arrangement for this accession allowed for a specific methodology for the calculation of dumping, which was introduced in Section 15 of the Accession Protocol and serves as a basis for different treatment for Chinese imports;

D.  whereas any decision on how to deal with imports from China after December 2016 must ensure compliance of EU law with WTO rules;

E.  whereas the provisions of Section 15 of China’s Accession Protocol to the WTO that remain in force after 2016 provide a basis for the application of a non-standard methodology to imports from China after 2016;

F.  whereas, given the current level of state influence on the Chinese economy, firms’ decisions on prices, costs, outputs and inputs do not respond to market signals reflecting supply and demand;

G.  whereas, in its Accession Protocol, China has committed, inter alia, to allowing all its prices to be determined by market forces, and whereas the EU must ensure that China complies fully with its WTO obligations;

H.  whereas China’s overcapacity is already having strong social, economic and environmental consequences in the EU, as demonstrated by its recent detrimental impact on the EU steel sector, in particular in the United Kingdom, and whereas the social impact on EU jobs of granting market economy status (MES) to China could be substantial;

I.  whereas 56 of the 73 anti-dumping measures currently in force in the EU apply to Chinese imports;

J.  whereas the recently concluded public consultation on the possible granting of MES to China could provide additional information which may be useful in addressing the issue;

K.  whereas the Commission communication of 10 October 2012 entitled ‘A stronger European industry for growth and economic recovery’ (COM(2012)0582) sets the objective of raising industry’s share of EU GDP to 20 % by 2020;

1.  Reiterates the importance of the EU partnership with China, in which free and fair trade and investment play an important role;

2.  Stresses that China is not a market economy and that the five criteria established by the EU to define market economies have not yet been fulfilled;

3.  Urges the Commission to coordinate with the EU’s major trading partners, including in the context of the upcoming G7 and G20 summits, on how best to ensure that all provisions of Section 15 of China’s Accession Protocol to the WTO that remain in force after 2016 are given full legal meaning under their domestic procedures, and to oppose any unilateral granting of MES to China;

4.  Stresses that, in the upcoming EU-China summit, the issues surrounding MES should be discussed;

5.  Calls on the Commission to take due account of the concerns expressed by EU industry, trade unions and other stakeholders as to the consequences for EU jobs, the environment, standards and sustainable economic growth in all the manufacturing sectors affected and for EU industry as a whole, and ensure, in this context, that EU jobs are defended;

6.  Is convinced that, until China meets all five EU criteria required to qualify as a market economy, the EU should use a non-standard methodology in anti-dumping and anti-subsidy investigations into Chinese imports in determining price comparability, in accordance with and giving full effect to those parts of Section 15 of China’s Accession Protocol which provide room for the application of a non-standard methodology; calls on the Commission to make a proposal in line with this principle;

7.  In parallel, stresses the imminent need for a general reform of the EU’s trade defence instruments in order to guarantee a level playing field for EU industry with China and other trading partners in full compliance with WTO rules; calls on the Council to rapidly seek agreement with Parliament on the modernisation of the Union’s trade defence instruments;

8.  Instructs its President to forward this resolution to the Council, the Commission and the governments and parliaments of the Member States.

(1) OJ L 343, 22.12.2009, p. 51.

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