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China's Xi seeks peace in Europe but side-steps Ukraine

Source: Reuters - Tue, 1 Apr 2014 12:25 GMT
Author: Reuters
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* China's Xi tells EU wants closer ties, no more war

* Speech ends a European tour against Ukraine backdrop

* Free-trade a long-held Chinese goal that divides EU

By Robin Emmott

BRUGES, Belgium, April 1 (Reuters) - Chinese President Xi Jinping told Europe on Tuesday that Beijing opposed intervention in other countries' affairs but he declined to directly criticise Russia for its annexation of Crimea.

Xi also assured European leaders that China was a close ally committed to the continent's peace and prosperity.

Ending his European tour with a speech in the Belgian city of Bruges, Xi said he considered China's relationship with the European Union as Beijing's priority and praised its commitment to a lasting peace that China would also seek to uphold.

He said that while the memory of foreign invasion and bullying had never been erased from the minds of the Chinese people, "I have come to Europe to build a bridge across the Eurasian continent."

Xi's speech to dignitaries including the Belgian king and prime minister were his only public remarks during three days in Belgium.

Though short on specifics, Xi, the first Chinese leader to visit the EU headquarters in Brussels, promised that Beijing is focused on ensuring non-intervention in other countries' affairs - an apparent reference to Russia, which is seeking to sell natural gas to China.

Beijing has been cautious not to be drawn into the struggle between Russia and the West over Ukraine's future but Xi suggested it would not encourage Russian aggression in Ukraine.

"China follows a policy of peace. China is committed to non-interference in other countries," Xi said.

China is a central player in the Ukraine crisis but has frustrated the European Union with its silence over Russia's annexation of Crimea, abstaining in a United Nations Security Council vote condemning the move on March 21.

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At an EU-China summit in Brussels on Monday, the European Union's top two officials, Herman Van Rompuy and Jose Manuel Barroso, pressed Xi on Russia and the Chinese leader said he "believed in the territorial integrity" of countries, according to EU officials briefed on the meeting.

The EU has offered a trade and aid deal to Ukraine to bring it closer to the union, angering Moscow, which considers the country its own and sought to include it in a Russian-led Eurasian customs union.

Ousted Ukrainian president Viktor Yanukovich rejected that trade deal in November in favour of cash from Moscow, triggering protests that led to bloodshed in Kiev and his flight to Russia.

FREE-TRADE DREAM

Xi used his speech to reiterate China's desire for a multi-billion euro free-trade deal with the EU - a long-held Chinese goal but one that divides Europe because of China's policy of helping its state-owned enterprises to dominate foreign markets.

Europe is China's most important trading partner, while for the EU, China is second only to the United States. Trade between the EU and China has doubled since 2003 to more than 1 billion euros ($1.4 billion) a day.

But the bilateral relationship has been bedevilled by a series of trade rows ranging from steel and wine to solar panels. China's ambition to produce more sophisticated products to compete with European goods also unnerves some Europeans.

"China and European may seem far apart geographically but we are in the same time and the same space," Xi said. "We need to build a bridge of growth and of prosperity...and actively explore possibility of a free-trade area."

Xi won a pledge from EU officials at the summit to consider such a pact, although the European Union insists that is a long way off and China must first show it is ready to play by international trade rules by agreeing an "investment agreement."

Xi's appetite for political and economic reform, coupled with his folksy style and the legacy of his father, a reformist former vice-premier, have raised hopes in Brussels that China is willing to do that.

China unveiled its boldest reforms in nearly three decades in November, months after Xi, who is 60, became president.

Negotiations towards such an investment accord are underway and should make it easier for European countries to do business in China, a big step that many see as a potential forerunner to a trade deal.

European companies complain of poor treatment in China, such as being forced to share sensitive know-how to win access to Chinese funding and local contracts. (Reporting by Robin Emmott; Editing by Angus MacSwan)

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