00:00French President Emmanuel Macron says imposing tariffs on Chinese imports is not the solution to the European Union's trade deficit with Beijing.
00:08Writing in the Financial Times, Macron warned that weak productivity within the EU is a key factor behind China's growing trade surplus with the bloc, which currently exceeds $300 billion.
00:20He said working cooperatively with China is the best way to address the issue, adding that protectionist measures should be used only as a last resort.
00:28Erik Solheim is the former Norwegian Minister of International Development and also served as Undersecretary-General of the United Nations.
00:37Look, whether this trade balance is too big at this moment can be discussed, but for sure it cannot just increase and increase.
00:47But it is not fair to criticise China because China's production has increased even more than China's export.
00:55So China is simply producing a lot more. China now has such a super efficient industrial ecosystem.
01:03I see it every day on my travels in China. Everyone struggles to compete. Europe struggles to compete.
01:08United States struggles to compete. The Global South struggles to compete.
01:12So everyone needs to discuss how we can do better.
01:15So what do you make of President Macron's comments? Because he's arguing that tariffs alone are not the answer. What's your take?
01:26Tariffs, of course, will just make the European market very small and European companies may win in that market, but they will be unable to compete in other markets.
01:36The way forward, paradoxically, is more China in Europe, not less.
01:40If Europe cooperates more with China, we will get more investment from China.
01:45We will get the best technology in all green sectors, electric cars, electric batteries, solar panels, windmills.
01:53We get the best technology. We should have more Chinese investment in Europe.
01:58We should roll out the red carpet for all these investments.
02:01And then, of course, we should demand that technology is transferred and that we can learn from it.
02:07And maybe Europe in the future can do better.
02:09So what you're saying is that the conversation really is all about EU competitiveness.
02:17Absolutely. Europe at the moment is struggling with our competitiveness.
02:22Germany, the largest nation in Europe, has not had economic growth or improved productivity in the last four years.
02:29And we need to find a way out of that.
02:32That, in a way, we should look to China to learn from what they have done and we can learn from that.
02:38China has a unique five-year plan setting out the future destiny of China.
02:44Now, focusing on the two major revolutions, the digital and the green.
02:49Europe needs to be able to plan better.
02:52We need to have more and better competition.
02:55I mean, the competition in the Chinese market is absolutely brutal.
02:59And to get that competition, we need to make the bureaucratic structures easier.
03:04And China has now a market, three times the European market.
03:07So obviously, Europe needs to integrate its market.
03:11Look, just as an example, China is now educating a lot more engineers and people in natural science than we do in Europe.
03:19And there's nothing wrong with journalists like you or political scientists like me, but we very rarely run businesses.
03:28This is true.
03:29But look, President Macron, the president of Europe's second largest economy, the country that is about to take on the presidency of the G7 in 2026.
03:39He's making these comments about competitiveness, about France's relationship with China.
03:47What's your outlook for that, based on that, in the months ahead?
03:53Let's take this as a positive start of a dialogue.
03:57There is a need for a dialogue between China and Europe.
04:00Europe needs to do its homework better.
04:02Unless we are competitive, we should not blame that on China or anyone else.
04:07We need to improve our own competitiveness, better research, better education, much faster decision-making in the public sector, integration of the market.
04:18We need to be competitive.
04:20But then we need a dialogue with China on two basic issues.
04:25How Europe can get a lot more investment from China.
04:27We can make that happen in real terms.
04:30We cannot just see Chinese companies exporting to Europe, but producing in Europe, making it in Europe.
04:38But then, of course, Europe must roll out the red carpet for these investments.
04:42And the other is to make sure that China also understands that China needs to go even further to make the Chinese market open for European companies.
04:52Sometimes European companies feel that they are not treated fairly in the Chinese market.
04:57But on these spaces, we need a dialogue, and then together we will be much stronger.
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