Economy

China asks EU halting investigation on China-made modems

(Xinhua)
Updated: 2010-12-21 16:15

BEIJING - China hopes the European Commission (EC) will stop an investigation into Chinese wireless wide area networking (WWAN) modems, Commerce Minister Chen Deming said Tuesday.

"We hope the EC will support the China-EU business cooperation and make a prompt decision to stop the three types of trade investigation. The Chinese government will continue to keep an eye on the issue," Chen told reporters on the sidelines of the third China-EU High-Level Economic and Trade Dialogue held in Beijing.

The EU opened an anti-subsidy probe into WWAN modems imported from China in September after it initiated an anti-dumping investigation and a safeguard measure probe into the modems in June.

The complaint behind the three probes was laid by Belgium's modem-maker Option, the sole producer of WWAN modems in the EU.

It is alleged that China unfairly subsidies wireless modem makers such as Huawei Technologies and ZTE Corporation.

Huawei rejects the accusations.

"China is very concerned with the issue because it involves a great amount of money and comes under three types of investigation," Chen said.

It is the first time that a single Chinese product has simultaneously come under three types of trade investigation by the EU.

The investigation is the largest trade remedy investigation case against China, involving a total value of $4.1 billion in exports.

Currently, the EC is deliberating whether to stop the safeguard measure, Chen said.

According to the World Trade Organization (WTO), a WTO member may restrict imports of a product temporarily (take "safeguard" actions) if its domestic industry is injured or threatened with injury caused by a surge in imports.

The investigations have affected some Chinese enterprises which export to the EU and caused a considerable amount of losses, Chen said. "This goes against the sound development of China-EU trade relations."

At the G20 summits in Washington and London, a consensus was reached that new trade protectionism measures would not be adopted during the financial crisis, Chen said.

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"At the ongoing dialogue, we have talked about such consensus and we should fight trade protectionism together," Chen said.

The 27-member EU is China's biggest trade partner. China is the EU's second-biggest trade partner and is its biggest source of imports.