Giants EU, China meet in 'challenging' times

Global giants the European Union and China meet at a Brussels summit on Thursday under pressure to bolster slowing economic growth and tackle tough international dilemmas.

With a new leadership to be named in Beijing within months, recession and mounting protectionist trade disputes form the backdrop to the summit, alongside diplomatic differences over Syria.

There is also fresh EU concern over tensions in the South China Sea and between Japan and China over disputed islands.

"The summit comes at a time of slowing global economic growth and an increasingly challenging international environment," a European Union statement said.

The 27-state EU bloc is China's single largest export market while China is the EU's second largest trading partner after the United States, with total trade worth nearly 430 billion euros ($560 billion) in 2011.

"Both sides recognise that continuing to strengthen the EU-China strategic partnership is essential to get through these difficult times," the EU statement added.

Chinese Premier Wen Jiabao will meet European Council President Herman Van Rompuy, European Commission President Jose Manuel Barroso and EU foreign policy head Catherine Ashton.

Beijing has repeatedly expressed concern about the EU slowdown.

It has offered help in resolving the eurozone debt crisis, but at the same time has been forced to take costly stimulus steps of its own to sustain domestic growth.

Europe hoped China might spend some of its near $3 trillion in foreign exchange reserves -- the largest in the world -- on helping stabilise the 17-nation bloc, but Beijing has been cautious in making any specific commitments.

Wen told visiting German Chancellor Angela Merkel last month that Beijing was ready to continue investing in eurozone sovereign debt markets "on condition of fully evaluating the risks," given ongoing "serious concerns".

The last bilateral summit in February -- postponed from October 2011 due to the debt crisis -- came amid intense speculation that Spain and Italy might need massive international bailouts after Greece, Ireland and Portugal all called for help.

With tensions having eased since then, EU sources said that the summit would aim to consolidate ties ahead of the leadership handover in Beijing -- "it is not a summit for big decisions", one said.

Having been in office since 2003, Wen is due to step down within months as the Chinese Communist Party and government passes the baton to a new generation of leaders.

Wen deserved recognition for his part in promoting the relationship, one EU source said, and the talks will "look forward to continuing (the relationship) with the new leadership".

Disputes -- including the biggest yet of its kind, an EU anti-dumping probe into the multi-billion-euro market for solar panels dominated by Chinese exporters -- should be kept in proportion.

Trade "frictions only touch a small part" of the EU-China relationship, the source said.

Other contentious issues will likely include human rights in China, and Syria, where Beijing has opposed Western policies.

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