EU Urges China to Consider Changing Monetary Policy

Luis Ramirez
Beijing
31 Oct 2003, 15:52 UTC

European Union officials are urging China to open its markets and reduce
trade barriers.

European Union Trade Commissioner Pascal Lamy says China should

consider pegging its currency, the yuan, to a currency basket. His remarks
Friday came a day after a European Union delegation held its sixth annual
summit with Chinese leaders.

AP Mr. Lamy's statements on China's currency echoed those of the United

EU president Silvio States, where anger is growing among manufacturers and labor unions,
Berlusconi, center,
looks on President
which argue that an artificially low yuan is giving Chinese products an
Romano Prodi, left, unfair competitive advantage.
Chinese President Hu
Jintao The EU officials took a softer approach than that of the United States,
saying Europe believes China should consider making gradual changes in its monetary policy.

The gentler approach appeared to reflect the mood of the meeting, with officials claiming a new
high in relations between China and Europe. They are each other's third largest trading partner, and
both appear eager to expand the relationship.

With a 19-gun salute, Chinese leaders on Friday welcomed Italian Prime Minister Silvio Berlusconi
to Beijing's Great Hall of the People.

Mr. Berlusconi holds the rotating presidency of the European Union. At a meeting with President
Hu Jintao Thursday, he signed agreements expanding trade and technology ties, and people-to-
people contacts.

European Commission Spokeswoman Isabel Ramallo says one important agreement will allow
China's participation in Europe's Galileo satellite navigation system.

"… The fact that China does participate with us on equal footing in this very important project
symbolizes how far we have gone in trusting each other and in sharing information with each
other," she said.

The United States opposes China's participation in the program, which rivals the U.S. Global
Positioning Satellite system.

Also on the agenda at the summit was the thorny issue of human rights, although discussion of the
matter was limited. EU officials say they brought up their concerns about China's rights record, but
not in detail. They say they will discuss the matter in a separate dialogue.