China pledges to continue buying euro zone bonds

CHINA HAS promised to continue buying the sovereign bonds of euro zone countries as Europe battles its debt crisis.

The pledge from premier Wen Jiabao came during a meeting in Brussels with European Council president Herman Van Rompuy and EU Commission chief José Manuel Barroso.

Both sides said afterwards they would seek to minimise protectionism in their expanding trading relationship. At China’s behest, there was no press conference after the talks.

The Chinese premier spoke at a business conference on the sidelines of the summit, Mr Wen’s last before a change in leadership.

Although European officials have often expressed the view that China could do more to help end the debt crisis, Mr Wen insisted his administration was playing its part.

“In recent months China has been continuing to invest in the euro zone government bonds and bonds issued by the European Financial Stability Facility,” he said.

“Europe is one of the main markets for China to invest its foreign exchange reserves and China will continue to participate in efforts to tackle Europe’s debt crisis through appropriate channels.”

With numerous allegations of dumping or below-cost selling by Chinese companies under scrutiny in Europe, Mr Wen urged the EU authorities to exercise restraint when resorting to trade remedy matters.

“We must uphold trade liberalisation and facilitation, oppose trade protectionism,” he said.

In a communique, Mr Van Rompuy and Mr Barroso said they discussed a “better level playing field” for commercial relations.

With Beijing thwarting efforts at the UN Security Council to secure a resolution against Syria, the EU leaders said they had asked China to “redouble its efforts” to ensure the council can contribute effectively to a resolution of the crisis.

They also raised China’s human rights policy. “We recognise the tremendous progress achieved in China by lifting hundreds of millions of people out of poverty. But there are also concerns, in particular regarding restrictions of freedom of expression and the situation in Tibet.”

The lack of a press conference was in keeping with previous summits, and prompted a complaint from the International Press Association in Brussels.

One suggestion on the European side was to conduct a press conference for 50 journalists, with 25 each from China and the international press corps.

This proved unacceptable to China, which wanted to vet attendance at any such event, and to journalists. More than 900 reporters have accreditation with the EU institutions.