China offers EU a helping hand
Berlin - Chinese Premier Wen Jiabao offered Europe a
"helping hand" with its debt crisis during a visit to Germany on
Tuesday, and said his country could buy the sovereign debt of some troubled
eurozone nations if needed.
"China has expressed support for Europe at various
times. In other words, when Europe is in difficulty we will extend a helping
hand from afar," the Chinese prime minister told a joint news conference
with German Chancellor Angela Merkel.
"We will according to need definitely purchase certain
amounts of sovereign debt," said Wen, who described the problems of highly
indebted eurozone countries like Greece as being of only a "temporary
As on previous occasions when talking about eurozone debt,
Wen did not give specific figures on potential purchases, nor which countries'
debt China might purchase.
Capital Economics estimated in a research note that China
bought more than €40bn of euro-denominated assets this year, much of that in
The German leader said China has a "massive"
interest in a stable euro though some policymakers, such as European Central
Bank (ECB) board member Juergen Stark, have cautioned against seeing China as
the "rescuer" of the common European currency.
The EU and International Monetary Fund (IMF) are putting
pressure on Greece to give political backing to a tough austerity programme, to
qualify for ongoing aid and work out a second bailout meant to tide it over
About a quarter of China's record foreign currency reserves
of more than $3 trillion are estimated to be held in euro assets, and China has
reiterated its confidence in the euro since the debt crisis began.
Wen visited Germany on the final leg of a European tour
taking in Hungary and Britain. It was the first time China and Germany - the
world's two biggest exporting nations - had held full ministerial consultations
aimed at boosting trade.
A day before Wen left for Europe, China released artist Ai
Weiwei on bail in a move analysts have said should not be interpreted as a
policy shift by the ruling Communist Party.
Merkel told Tuesday's news conference she welcomed the
release, but wanted China to ensure fair legal treatment for Ai and recently
released dissident Hu Jia, as well as more press freedom.
A Brussels think-tank, the European Council on Foreign
Relations, said China's new effective status as "a lender of last
resort" had "serious implications for Europe's ability to present a
united front to China" on such issues.
Dependent on China
Wen said the main point of the bilateral meeting was to
"boost the growth potential of bilateral trade ... and to once again
double our bilateral trade volume in five years".
He said deals worth more than $15bn were signed by Chinese
and German firms during the visit. Airbus signed a deal with China Aviation
Supplies and an aircraft leasing arm of China's ICBC bank for the delivery of
88 A320 planes, with a list price of $7.5bn.
A separate Chinese Airbus deal worth $3.8bn for superjumbos
had previously been delayed in protest at EU carbon emissions trading rules,
industry sources say.
Merkel said she expected bilateral trade to reach about
€200bn over that period, from €130bn in 2010 when trade had already surged 34%
on the previous year.
Britain and China signed deals worth $2.3bn during the
premier's visit there on Monday.
Germany hopes for a rebalancing of investments between the
two countries, with Germany's direct investments in China now standing at €20bn
euros compared to Chinese investments in Germany of only about €600m, German
A German television channel ran an unscientific telephone
poll during Wen's visit to Berlin and 81% of Germans who responded said their
country was growing "too dependent" on China.
But German Foreign Minister Guido Westerwelle said China's
rapid growth and burgeoning influence on the world stage "need not be at
Germany's expense but to our benefit" if his country managed it cleverly,
though he acknowledged there were differences between the two governments on