Third Day for China-EU WTO Talks

Chinese and European trade officials Wednesday spent a third tough day in Beijing of bargaining over a bilateral trade deal without reaching an agreement on China's accession to the World Trade Organisation.

EU Trade Commissioner Pascal Lamy held two-and-a-half hours of talks in the morning with China's foreign trade minister Shi Guangsheng, before leaving officials to carry on "technical talks" for another hour.

A new session of technical discussions on the fine print of a potential market opening deal was held in the afternoon, but it broke up without a long-awaited deal.

The European Union is the last of China's major trading partners to reach an agreement on Beijing's WTO accession, and the two sides have been cautiously optimistic a deal can be reached this week.

China's ministry of foreign trade and economic cooperation declined all comment on the talks Wednesday, and EU spokesman Anthony Gooch chose his words very carefully.

"It is too early to say how things will pan out, it is very difficult at this stage to make predictions," he told reporters after the morning session between Lamy and Shi.

"To the extent that we are here and talks are ongoing, that is a good sign but it is by no means a sign that at the end of the day that we will achieve a result that we both like."

China's 14-year bid for membership of the Geneva-based trading body was given further momentum on Tuesday with the signing of bilateral agreement with Latvia.

Apart from the EU, China now only needs accords with Costa Rica, Ecuador, Guatemala, Mexico and Switzerland to seal its membership.

Lamy arrived in Beijing on Monday for the fourth round of negotiations between the two sides this year.

The EU is pushing for greater concessions on a range of issues than China gave to the United States in a market opening WTO agreement reached in November last year.

The European side is concentrating on areas where the European Union has a strong interest such as telecommunications and insurance, as well as pushing for tariff reductions on goods such as English gin and French Cognac not addressed in the US deal.

Western diplomatic sources briefed on the first two days of talks said the atmosphere was good and constructive, but that discussions were still some way off a deal.

"The technical discussions could still go on for quite a while but a compromise is a possibility," said one diplomat.

Lamy said last week access to China's mobile telecommunications market would be a key issue, with the EU pushing for European companies to be allowed a 51-percent stake in joint ventures.

A Western telecoms expert briefed on discussions said the EU had already backed down from its demand for majority stakes, but that the Chinese side was refusing to even allow foreign telecom companies 50 percent stakes in mobile joint ventures.

Any concessions China makes to one WTO member must be offered to all 136 members of the rules-based global trading body.

The talks come as the US Congress prepares for a highly-divisive debate and vote next week on whether to give China permanent normal trading relations (PNTR), and analysts say both China and the US administration would be very keen to see a Sino-EU deal this week.

But the EU has said it will not be pressured into a deal by the vote.

While the Europeans have always said the US deal covers 80 percent of their concerns, they have also pointed to the difficulty of representing the varied demands of 15 different EU economies.





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