Posted by: kenwbudd | December 1, 2009

EU showing modest change to defecit with China

The European Union issued new figures on Friday showing that the bloc’s trade deficit with China narrowed in the first half of the year, three days from a bilateral summit in China.

In the first half of 2009, when the euro was rising against the dollar, to which the Chinese yuan is de-facto pegged, the value of EU exports to China fell to 37 billion euros (55.5 billion dollars) from 39 billion dollars in the corresponding period of 2008.

The EU’s statistics agency said imports fell faster to 103 billion euros from 112 billion euros, meaning the trade deficit for the 27 EU countries with China dropped to 65 billion euros from 73 billion euros between January and June last year.

However, the fall “was less steep than the general downward trend” in the EU’s total external trade, said a statement from Eurostat, which highlighted China’s place as the bloc’s second most important trading partner after the United States.

European Central Bank governor Jean-Claude Trichet, outgoing Economic and Monetary Affairs Commissioner Joaquin Almunia — due to take up the competition portfolio — and the formal head of the group of 16 countries that use the euro, Luxembourg Prime Minister Jean-Claude Juncker, will hold talks with Chinese Premier Wen Jiabao on Sunday.

These precede the first full summit between the EU and China in two years, after last year’s was cancelled amid Beijing protests at French President Nicolas Sarkozy hosting Tibet’s spiritual leader the Dalai Lama.

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