Norwegian experts see China-Europe trade positive overall

OSLO - Trade frictions between China and the European Union (EU) have their global impact, but Norwegian experts say these frictions could not undermine the relationship between the two sides and overall international trade.

They said more transparency and respect of World Trade Organization (WTO) agreements and international regulations will boost cooperation and prevent trade protectionism.

Respecting WTO rules

China has expressed doubts about anti-dumping taxes imposed by the EU on steel products and solar panels from China, calling for an end to such unfair measures.

"Although there have been some trade frictions between China and Europe, they should not be over-dimensioned. The EU has implemented new anti-dumping measures on iron and steel, but most of the trade continues without problems," Arne Melchior, senior research fellow at Norwegian Institute of International Affairs (NUPI), told Xinhua.

"Lower economic growth in Europe leads to more discussion on trade politics, the same way the industry crisis in 1970s led to quota restrictions on textile. Anti-dumping measures are more often used during recession," he said.

Melchior believed that overcapacity in the metal sector and lower prices were what led to "a new discussion on trade politics in the EU, where its northern members have a more liberal attitude."

"Brexit could eventually weaken the liberal wing in the EU's trade discussion," he added.

Melchior emphasized the importance of respecting WTO frames when resolving trade conflicts. "China could make an effort to counter criticism from the EU and the United States that refers to unfair competition by focusing on subsidies, patent rights and competitive conditions," he said.

Paul Midford, professor of political science at Norwegian University of Science and Technology, said there have been "real trade frictions" concerning solar panels and steal exports from China to the EU.

"Nonetheless, I don't think these frictions are serious enough to undermine the overall economic and political relationship. Both sides now have a strong incentive to cooperate in promoting an open and liberal international trade order and resist the protectionist sentiments," he said.

The reports about a possible early summit between China and the EU this year reflected the new priority the two sides were putting on cooperation against protectionism, Midford said.

Norway as a bridge

In the wake of normalization of the diplomatic ties between China and Norway, many are positive about the future diplomatic and economic cooperation and possible free-trade agreement between the two countries.

"Norway is an open economy that is dependent on a well-functioning multilateral trading system. Norwegian welfare is built on trade and international division of labor, and we have strong interests in an open world trade with a level playing field," Norwegian Minister of Trade and Industry Monica Maeland told Xinhua.

"Norway will continue to work for an open world trade and new trade agreements. The Norwegian government is, therefore, looking forward to resuming negotiations on a free-trade agreement between Norway and China. A free-trade agreement will benefit both countries by increasing trade and investment," she said.

Melchior also expressed hope for stronger economic cooperation between Norway and China and believed the Nordic country could play an important role in the world trade system.

"Norway has a positive attitude towards China and has for example supported the Asian Infrastructure Investment Bank (AIIB)," he said.

"Norway is not a member of the EU, but participates in the European Economic Area (EEA), and we are, together with the northern EU-countries, among those that are for freer trade," he said.

The EEA was established in 1994 and now it contains the EU's 28 member states plus Norway, Iceland and Liechtenstein. The EEA Agreement provides for the free movement of human resources, goods, services and capital within the single market.

"This is an important time, when there is an increased support of protectionism in some Western countries, including the United States. Norway can also play an important role in the WTO to prevent polarization in trade politics," Melchior said.

Helge Hveem, professor of political science at University of Oslo, agreed that Norway could play an important role in the current trade conflicts between Europe and China.

"Since Norway has normalized its political and diplomatic connections with China. It is not unthinkable that Norway can play a role as a mediator for proposals to solutions, either through its WTO channels or via direct bilateral contacts between China and the EU," he said.