Finland hopes EU, China to value free trade: Finnish PM (2)

HELSINKI, Sept. 9 -- Finnish Prime Minister Jyrki Katainen said that the European Union and China should attach more importance to the concept of free trade, especially when signals indicate possible recovery from economic crisis.

Katainen made the remarks in an interview with Xinhua reporters before his journey to China on Monday.

Believing that Europe is no longer a crisis hot spot, Katainen said it is very important for EU to work with China in an approach emphasizing the free trade philosophy.

"The more we can liberalize our trade relationship, the better for both, because it would help both European and Chinese companies to improve competitiveness and productivity," he said, "and of course there are a lot of opportunities for investment."

"Not all EU members have been interested in liberalizing trade, but luckily we have managed to collect a group of countries who have put those decisions forward," Katainen said.

CLEAN-TECH POTENTIAL

The prime minister saw great potential in clean technology-related businesses, which concentrate on renewable energy, energy efficiency, environmental restoration and so on.

While China has been striving for more sustainable economy, its great need of clean technology plays a "very crucial role" in the world growth.

"That is the reason why I am coming to China. I can imagine that clean technologies, whatever it means, water cleaning, bio-fuel, energy saving, more efficient industrial processes, and city planning, could play a very big role in our trade relation."

Together with Environmental Minister Ville Niinisto, as well as a delegation representing 30 clean technology companies, Katainen will visit China and attend the Summer Davos Forum, also known as the World Economic Forum Annual Meeting of the New Champions, slated for Sept.11-13 in the northeast Chinese city of Dalian.

The theme of this year's gathering will concentrate on innovation. Industry, market and financial risks will also be discussed. The event is expected to bring together about 1,600 elites from all over the world.

GROWTH MAP

On the development of the world economy, Katainen said domestic consumption has been growing a lot in the United States, so it means that trade from Europe and emerging economies to the United States is one driver for the growth of the world economy, said the 42-year-old Finnish government leader.

Predicting a general bright picture for the world economic trend, he said that the outlook of the United States is much better now than half a year ago and quite growth is expected; the European situation has been stabilized, although there will not be a boom; growth in emerging economies will continue to perform better than in the U.S. and Europe, but not necessarily as good as they used to be.

The only one big question lies in the big emerging markets, where situation could be complicated by the U.S. Federal Reserves' withdrawal from monetary easing, noted Katainen.

Asked by Xinhua reporters if the policy could inflict harm on emerging markets, Katainen said: "it depends on how strong the economy is."

"If there is structural weakness, then the economy will or could suffer more than in the situation when the fundaments are in good situation," he elaborated.

Katainen underlined that to invest in environmental businesses and boost domestic consumption will help counter the negative effect on China.