Amid China-EU tensions, former Finnish prime minister warns of societal harm from tariffs
Beijing should take action to address the European Union's concerns over China's overseas projects, products and technology, as open discussions are vital to managing differences and tensions, former Finnish prime minister Mari Kiviniemi said on Wednesday.
"I'm very worried about these tensions - and geopolitical tensions," Kiviniemi told the Post on the sidelines of the annual conference of the Asian Infrastructure Investment Bank (AIIB) in Samarkand, Uzbekistan. "Because, from my background, I know so well how much protectionism and tariffs harm the world economy, and by that, it harms all of society."
Kiviniemi served as the prime minister of Finland from 2010-11 and was deputy secretary general of the Organisation for Economic Cooperation and Development from 2014-18. She is now chair of the board at the University of Vaasa in Finland.
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Her comments came as economic relations between Beijing and Brussels have soured this year.
Particularly, the European Union's decision to impose additional import tariffs - ranging from 17.4 to 37.6 per cent - on major Chinese-made electric vehicle producers fuelled fears of a trade war and was met with countermeasures from Beijing.
Beijing has expressed concerns over the de-risking strategy of the EU, which is China's second-largest export destination, and has been wary of more orchestrated actions against it after the United States and Canada announced punitive duties.
China's commerce minister, Wang Wentao, held talks with European Commission executive vice-president and trade commissioner Valdis Dombrovskis last week.
No concrete deals were announced, but both vowed "maximum effort to work towards a mutually agreeable solution", according to the EU readout.
After Beijing turned last month to the World Trade Organization for arbitration over the EU's tariff decision, Brussels on Monday launched a challenge at the Geneva-based multilateral trade system to Beijing's investigation into EU dairy products.
The former Finnish prime minister acknowledged that the situation was "not a good one", while adding that the concerns from the EU and the US should be taken seriously.
"There's always this question: what is behind this Chinese company?" she added. "Openness and transparency are kind of the best remedy for fears there are in terms of security."
Finland is a founding member of the AIIB and is also part of China's Belt and Road Initiative - an initiative by the central government to link economies into a China-centred trading network.
In the first eight months of this year, the value of bilateral trade between Finland and China fell by 2.9 per cent from a year earlier, to US$5.58 billion, Chinese customs data showed.
Many Finnish projects, including a 100km (62-mile) tunnel between the Finnish capital of Helsinki and Estonia's Tallinn, were previously delayed because of the reported involvement of Chinese funds and know-how.
However, the Post reported earlier this year that Finnish developers were pushing ahead with the tunnel plan, and would still want Chinese companies to build it.
Kiviniemi said open discussions remained important to finding answers to security concerns.
"[Beijing officials] need to address transparency. I think transparency is really the key - and open discussions," she said.
The value of trade between China and the EU fell during the first eight months of this year by 1 per cent, year on year, to US$523.1 billion.
This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2024 South China Morning Post Publishers Ltd. All rights reserved.
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