The first plenary meeting of the China-EU Industrial Dialogue held Tuesday in Beijing, was both useful and fruitful, said a senior EU official.

The closed-door meeting discussed the framework and procedures for dialogue and went onto look at three particular areas, those of auto-making, metals and textiles, said Jean-Paul Mingasson, Director-General of the European Commission's Enterprise Directorate-General.

He said both sides agreed to develop regular dialogues, with their next meeting expected to be held in Brussels next September or October.

The National Development and Reform Commission led by vice-minister Zhang Guobao is China's official representative.

"When the EU and China develop a new legislation proposal, dialogue will enable greater consultation, thereby allowing each side to make comments and voice their objections," he said.

Representatives from the three specific industries and associations participated in yesterday's discussions.

Mingasson said the EU industry had taken note of China's recently developed ambitious automaking policy, and ambitions to become a global carmaker.

As part of the industry, EU automakers want to be dealt with fairly.

For example, EU car makers have expressed concerns that Chinese rules require them to operate separate distribution channels for domestically-made and imported vehicles.

Mingasson said they have delivered this message to the Chinese side and expected to have a solution soon.

In respect of textiles, Mingasson said the situation in the EU is difficult and their industry is facing competition from many countries, including China.

"It is unavoidable, because of the comparative advantage, that China's share will increase after the quota lift," he said.

Under the Agreement on Textiles and Clothing (ATC), all quotas restricting textiles and clothing trade between World Trade Organization (WTO) members will be eliminated by December 31, 2004.

The EU textile industry considers their future lies, for example, in the export of more technically advanced textiles and value-added clothing, he added.

"They need a clear vision of opportunities in the future in China," said Mingasson.

In respect of metals, he said China is developing very quickly and absorbs large quantities of all materials.

Mingasson said the EU faces the same challenges in the industry and understands China's development goal of decreasing the polluting industry.

But he said both sides must compete fairly for materials, for example coke.

A compromise was reached between China and the European Union on the coke trade in May.

China promised to export 4.5 million tons to the EU in 2004, the same amount it imported in 2003, and deliver export licences without cost or delay.

China began capping coal export quotas this year because of environmental concerns.

Mingasson said he did not expect the new dialogue would solve all the issues in bilateral relations at once.

"But the dialogue will create the transparency and mutual understanding needed for solving them," he said.

Mingasson noted that EU-China relations have never been more intense and mature.

China-EU bilateral trade is expected to hit US$180 billion this year, compared to US$125.22 billion last year.

The figure increased by 36.6 percent in the first eight months year-on-year to US$111.65 billion, enabling the EU to replace Japan as China's largest trading partner after its recent enlargement into a 25-member bloc in May.

China is currently the EU's second largest trading partner.

(China Daily September 22, 2004)