EU and Chinese officials meeting in Brussels on Tuesday proclaimed their summit as a win-win, but far more striking was the big loser: Donald Trump.

European Council President Donald Tusk declared a “breakthrough” on some of the EUs major trade disagreements — including a joint pledge to back tough World Trade Organization rules on industrial subsidies. Commission President Jean-Claude Juncker said: “Today, we are making good on our joint commitment to uphold and to update the rules-based global order that has served us so well.”

And Chinese Prime Minister Li Keqiang, appearing at a news conference with Tusk and Juncker, declared the agreements reached at the summit “something good for Chinas reform and opening-up endeavors, and good for European unity and prosperity.”

While Li and his European counterparts were celebrating what he called “concrete goals and outcomes,” a newspaper close to the Chinese Communist Party cast doubt on Trumps suggestion that he would reach a deal to end his trade war with China within four weeks.

The newspaper, The Global Times, which is affiliated with the Peoples Daily, the official publication of the partys central committee, published an editorial calling Trumps prediction “just an uncertain timetable” and it warned that any effort to force through a deal could have serious negative consequences, the South China Morning Post reported.

“The word you have heard most here today is reciprocity” — Senior EU diplomat

In Brussels, during a series of summit meetings at which officials worked hard to focus on common interests, perhaps the foremost imperative for Brussels and Beijing was to showcase the failure of Trumps belligerence — his slapping of unilateral tariffs on $250 billion worth of Chinese goods and his threats of punitive levies against EU-made automobiles — in achieving real gains for the U.S. vis-à-vis the worlds biggest trading powers.

Last week, Tusk urged EU leaders not to support a joint statement with China, saying there had not been sufficient cooperation from the Chinese side to address European concerns on a range of issues. But an intense 72 hours of negotiations led to key breakthroughs, particularly on the issue of industrial subsidies, as well as on geographical indications, and it yielded a robust joint statement.

For the EU, it was an illustration that a bloc known for soft power could take a harder line, and also that its commitment to dialogue was a source of strength not weakness. It was also a chance to show that China was more than willing to deal with the EU collectively.

For China, it was an opportunity to portray itself as compromising and reasonable — essentially a preemptive move against any suggestion by Trump that failure to reach a deal was the result of Chinese intransigence.

U.S. President Donald Trump | Mandel Ngan/AFP via Getty Images

For the Americans, it was also a stark illustration of the opportunity Trump and his administration had missed to team up with the Europeans in pressing China for a swifter opening of its markets to the West, and quicker reforms to its legal and regulatory systems.

“We have the same criticism of the situation in the Chinese market and we use different ways of addressing them,” a senior EU diplomat said. “One is cooperative and in dialogue and negotiation, and the other one is with the use of unilateral measures outside of the WTO scheme, and we have never been shy about addressing these differences of method.”

Elephant in the room

Trump seemed to be the protectionist elephant in the room throughout the EUs negotiation process with the Chinese, according to EU officials who said that at numerous points, they sensed China was stalling on various issues awaiting the outcome of their simultaneous talks with Washington.

The U.S. president, by virtue of his heavy tariffs, has more muscle and may yet extract more in the way of hard concessions from China than the EU, which mainly won more in political commitments. But in a twist, it was the EU that clinched its symbolic victory first, with Trump ironically providing extra incentive for Beijing to reach a deal with the Europeans.

But the EUs own willingness to take a tougher line also helped.

At an EU summit last month, leaders warned that they were prepared to take more aggressive steps against economic competitors who engaged in practices that the bloc views as unfair. Although China was not mentioned by name, the summit focused heavily on preparation for Tuesdays meeting with the Chinese and it was quite clear that Beijing was the main source of the EUs concerns.

“The EU must also safeguard its interests in the light of unfair practices of third countries, making full use of trade defence instruments and our public procurement rules, as well as ensuring effective reciprocity for public procurement with third countries,” the leaders wrote in their formal conclusions. “The European Council calls for resuming discussions on the EUs international procurement instrument — the new European foreign investment screening framework will enable member states to address investments that threaten security or public order.”

After Tuesdays meeting, officials said the message appeared to have been heard — both in terms of the EUs clear resolve, but also in its commitment to respond within the rules-based framework.

“The word you have heard most here today is reciprocity,” the senior diplomat said. “When you look at the European Council of two weeks ago, you will see in the economic part, the decision of the leaders: we will use more and more measures.” Noting the emphasis on procurement, the diplomat added: “We are not talking about the unilateral imposition of tariffs for national security purposes. It will still be the EU way.”

The U.S. way was also on display in Brussels Tuesday as the American ambassador to the EU met with officials from the European Parliament and again slammed the EU over its trade dispute with Washington.

We need the EU to take a strategic worldview, rather than an unhelpful, overly reactionary stance. Regulations and other types of non-tariff barriers, including thinly veiled anti-Americanism, is not aRead More – Source

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