The European Parliament has recently said “no” to grant market economy status (MES) to China. At the final vote, 84% of its Members backed the EP document, which made it look to the outsiders like a broad consensus against MES for China. However, a closer look at the actual text adopted and on how MEPs voted on key amendments show a much more nuanced picture by country and political family:
- The Liberals (ALDE) and Conservatives (ECR) are more supportive of MES for China than all the other political groups in the European Parliament. In fact, in the original motions tabled by the two groups, there was no mention of denying MES to China.
- Apart from the far right and eurosceptic groups, notable opposition comes from the Social Democrat group (S&D). According to the group, MES to China should be granted only if the country meets the five criteria established by the EU to assess whether a foreign country has a market economy.
- However, there are also strong national differences, in particular in the centre-right group (EPP), which is the largest in the European Parliament. French, Italians and Hungarians MEPs are leading the protection front, whereas Polish, Dutch and Swedes are more supportive of MES.
- Opposition to granting MES to China is mainly driven by the overall national attitudes over free trade rather than the actual impact of MES on jobs and growth in Europe. In fact, EU Members States are similarly divided over the reform of the lesser duty rule, with Hungarians, French and Italian MEP pushing for an option which would allow the European Commission to impose higher customs duties on imported steel and other products.
- An overall positive perception of China across the people in certain EU Member States does not lead to an increase in the support for granting MES to China. In this case, the perception of China as the leading economic superpower is a more relevant indicator for assessing the opposition to grant MES to the Asian country.
- Also the level of imports from China to the EU is an important factor for assessing the position of a EU State on the issue (Netherlands, Germany, UK). In fact, associations of importers are lobbying in favor of granting MES to China, partially countering the strong lobbying activity exerted by the steel industry and other sectors which would be negatively affected by MES.
The full analysis by Vote Watch Europe can be downloaded below: