BERNE, Switzerland: Applauded by Switzerland’s business sector, the country’s free-trade deal with China is heavy with symbolism, coming as Beijing locks horns with the European Union (EU) in a raft of commercial disputes.
The staunchly non-EU Swiss inked a preliminary accord on Friday during Chinese Premier Li Keqiang’s first visit to Europe since taking the helm in March’s once-in-a-decade power transfer.
The final Free Trade Agreement (FTA) is set to be signed in July, capping two years of talks.
“This has huge meaning for global free trade,” Li said in Switzerland, explaining that it sends the world “a strong signal about the fight against trade and investment protectionism, as well as the liberalization and facilitation of trade.”
Swiss Economy Minister Johann Schneider-Ammann echoed that.
“The FTA will not only further develop and deepen our bilateral relationship, but it will also contribute to much needed progress toward global liberalization of trade and to curbing protectionism,” he said.
In Switzerland, Li took the opportunity to launch a broadside against the EU, challenging its punitive import duties on Chinese-made solar panels, as well as moves against the mobile telecommunications sector.
The EU argues that such Chinese products are being dumped on its market, hurting European firms, but China’s Xinhua news agency quoted Li as saying the moves “harm others without benefiting oneself.”
The economies of China and the 27-nation EU are tightly linked.
The EU is China’s top export market, while China is second to the United States for EU exports.
But the balance is largely in China’s favor, with Chinese exports to the EU worth $375 billion in 2012, and EU exports to China, $186 billion.
In contrast, Switzerland is one of the rare Western countries with a positive trade balance with China, its third-ranked partner after the EU and the United States.
Swiss-Chinese bilateral trade totaled $26.3 billion in 2012, with $22.8 billion of that in Switzerland’s favor.
Its top exports to China are watches, pharmaceuticals and chemicals and machinery, while textiles and machinery head the list of imported Chinese goods.