EU, China tackle trade issues ahead of leaders' summit

By Leigh Thomas and Julia Payne

PARIS (Reuters) -The European Union's trade chief on Wednesday said Brussels and Beijing were working hard to address issues in their trade relationship ahead of a July summit, as Europe joined a chorus of alarm over China's stranglehold on critical minerals.

Trade Commissioner Maros Sefcovic described talks in Paris with China's Commerce Minister Wang Wentao as "focused and in depth", though there was no clear sign of progress in resolving the tit-for-tat dispute over European tariffs on Chinese-made EVs and Chinese anti-dumping measures on European brandy.

U.S. President Donald Trump's upending of global trade has injected energy into EU trade negotiations with countries including China, although the EU still has deep concerns over what it calls market-distorting Chinese state aid and barriers to the Chinese market.

The talks took place against a backdrop of growing concern about China's export restrictions on critical minerals and magnets which have impacted supply chains central to automakers, aerospace manufacturers and semi-conductor companies globally.

Europe faces a delicate task to advance its own trading relationship with China without riling the Trump administration, which has hit European steel and aluminium with 50% tariffs and has threatened the bloc with 50% reciprocal tariffs if no trade deal is forthcoming.

Sefcovic held separate meetings in Paris with Wang and U.S. Trade Representative Jamieson Greer and he said talks with the U.S. were moving in the right direction.

Europe's diversification of raw material supply chains is critical to guaranteeing economic autonomy, EU Industry Commissioner Stephane Sejourne said on Wednesday.

"We must reduce our dependencies on all countries, particularly on countries like China, on which we are more than 100% dependent," Sejourne told a press conference in Brussels.

European and Chinese leaders are due to meet next month at a summit in Beijing to mark 50 years of diplomatic ties. China is the EU's second largest trading partner after the United States, with bilateral trade reaching 793 billion euros in 2023, according to EU data.

Shares in Europe's Airbus rose on Wednesday as evidence of talks to sell hundreds of planes to China gathered pace.

The dispute with Beijing over Chinese duties on brandy is proving tougher to resolve with the French cognac industry bearing the brunt of the levies.

France's trade minister Laurent Saint-Martin told Wang he wanted "responsible dialogue" while Wang said it was necessary to find solutions based on "win-win cooperation", according to a Chinese commerce ministry statement.   

(Writing by Richard Lough, editing by Ed Osmond)