European Trade with China
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Code : ITF0018
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Region : :China Europe |
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Introduction: After the 1949 Cultural Revolution of China, the diplomatic relation between China and the European Community (EC)3 which had been cutoff was officially re-established in 1975 (Annexure I). In 1975, trade between EC and China was a mere $2.4 billion.4 Economic reforms of China that started in 1978 gave a major boost to this bilateral trade. EU’s trade balancewithChina,whichwas positive before 1980, fell to a deficit of €47.3 billion5 by 2002 (Annexure II). Despite the deficit, trade between China and the European Union (EU)6 reached €115 billion ($142 billion), “makingChina EU’s second-largest trading partner after the U.S”7 with a forty-fold growth8 in the bilateral trade since the inception of China’s economic reforms – “Even seasoned economic observerswere surprised at the rapid increase in bilateral trade between China and EU countries.”9 The factors that helped in increasing the trade between EU and China were cited as, the economic reforms in China; China joining the ‘World Trade Organisation’(WTO); and the introduction of Euro apart fromthe signing of bilateral trade agreements at regular intervals – strengthening the trade relation that began in 1978. |
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