The European Union said on Tuesday that China has pledged to guarantee the supply of rare earths, minerals essential to high-tech industry, to Europe as the two sides wrapped up high-level economic talks.
“I made the point very strongly that this is a major concern to EU business. Any disruption to supplies is totally not to anyone’s benefit. Chinese colleagues reiterated that the supply of rare earths will be sustained,” EU Trade Commissioner Karel De Gucht told reporters following the talks.
China accounts for 97 percent of the global production of rare earths, essential to high-tech products such as cell phones, computer drives and hybrid cars. Countries worldwide were alarmed when Beijing blocked shipments of the minerals to Japan earlier this year amid a squabble over disputed islands.
The commitment was made during the third China-EU High-Level Economic and Trade Dialogue, where progress was also made on a possible treaty to increase investment from both sides, he said.
The EU is China’s largest trading partner, while China is the EU’s second-largest trading partner behind the United States. Two-way trade for the first 11 months this year reached $433.9 billion, an increase of 33 percent from the previous year.
During the opening of the forum, Vice Premier Wang Qishan said that China had also taken steps to help European nations combat the sovereign debt crisis.
Mr. Wang said the two sides “should have confidence and enhance cooperation to work together for a robust, sustainable and balanced growth,” according to the official Xinhua News Agency.
EU Commissioner for Economic and Monetary Affairs Olli Rehn told the news conference that the European Union welcomes the support by China for its measures to stabilize the ongoing financial crisis.
“Economic recovery has taken hold in the EU. It is progressing and spreading from export growth to domestic demand,” he said.
Last week, EU leaders agreed to the creation of a permanent rescue mechanism for debt-laden countries in 2013 that would replace an existing bailout fund.
Ireland last month agreed to borrow up to euro 67.5 billion ($90 billion) from the EU and International Monetary Fund and implement severe spending cuts as its economy staggered under the weight of massively indebted banks.
The Irish rescue followed the EU-IMF bailout of Greece earlier this year and added to fears that other financially weak countries including Portugal and Spain would need bailouts, imperilling the future of the euro common currency.
China has also been involved in bailing out European countries, offering in October to buy Greece’s debt. Last week, Portugal said that China had pledged increased support for its efforts to climb out of a financial crisis, reportedly promising to buy $4 billion in Portuguese government debt.
Mr. Wang said global economic recovery is being hampered by weak demand, while world markets have excessive liquidity and are turbulent.
He reiterated that China would implement a prudent monetary policy to ensure the world’s second-largest economy can maintain steady growth.
“China is taking a proactive fiscal policy and stable currency policy, while the EU is actively taking measures to combat the debt crisis,” Mr. Wang said. “China and the EU should strengthen cooperation to promote strong, sustainable and all-around growth for the economies of China and EU and even the global economy.”
Other officials participating in the talks include EU Competition Commissioner Joaquin Almunia and China’s Commerce Minister Chen Deming.