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Trade and economic co-operation between China and the European Union (EU) will continue to prosper, with the EU likely to become China's largest trading partner in the near future, Ian Kay, executive general manager of the EU Chamber of Commerce in China, said yesterday in Beijing.

"Relations between the EU and China are better than ever before, and the EU-China Summit at the end of this month (in Beijing) is an opportunity to crystallize these relations," he noted.

To further strengthen China-EU relations, high-level government officials from China and the EU will attend the summit.

Kay made the remarks at a briefing about the launching of the EU Chamber's Position Paper 2003. Position Paper 2003, the fourth in a series of such documents, examines developments since China's accession to the World Trade Organization (WTO) in December 2001.

Kay said that after enlargement next May, the EU will have a population of 450 million consumers and a GDP (domestic gross product) of over US$100 trillion.

Kay predicted that in the near future, the EU is likely to become China's largest trading partner.

Kay's opinion was echoed by Franz Jessen, deputy-head of the European Commission delegation in Beijing.

"Our relationship has increasingly become a strategic one, and we aim at 'win-win situations' beneficial to both sides," said Jessen at a workshop held by the newly-founded Research Centre for China-EU Economic Co-operation yesterday in Beijing.

In September this year, China overtook Switzerland as the second biggest trading partner of the EU, with bilateral commodity trade hitting US$89 billion for the January-September period, said Xiao Youfu, head of the research centre and also a professor with the University of International Business and Economics.

Xiao predicted that commodity trade between China and the EU will reach US$150 billion in 2005 and US$300 billion in 2010, as the two sides are moving forward rapidly in strengthening their strategic partnership.

Xiao said his centre would offer consultative services to governments, institutions and enterprises worldwide, and would hold regular international workshops as a platform for communication.

Ernst H. Behrens, president of the EU Chamber of Commerce in China, says in his forward to Position Paper 2003 that "it is worth noting that since then (China's accession to the WTO), China has implemented many of the prescribed changes detailed in the Protocol on Accession, particularly in the area of tariff reductions and opening of the market. Some of these changes even came ahead of time."

"China is no different from any other marketplace," Behrens stresses, adding that the challenge is to have a clear understanding of the market, a sound business plan, a clearly identified customer base, careful selection of partners and excellence in execution.

Established in November 1999, the EU Chamber has the overall objective of facilitating contact and communication within the European business community in China and establishing a constructive dialogue with the Chinese authorities in order to improve the business environment.

Position Paper 2003 presents the EU Chamber's views concerning the issues of equal national treatment, meeting international standards, transparency, and effective enforcement of intellectual property rights.

Jan Borgonjon, vice-president of the chamber, said that it is still difficult for small- and medium-sized EU firms to do business in China and that he hopes China will open its markets wider.

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