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25th Jun 2018

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China urges Germany and France to solve euro-crisis

  • Wen Jiabao is seeing Angela Merkel for the second time this year (Photo: picture-alliance/Frank May)

Chinese Prime Minister Wen Jiabao on Thursday (30 August) offered vague promises to buy bonds from troubled euro-countries, but said that it is ultimately up to Germany and France to solve the crisis.

"The European debt crisis recently has continued to deteriorate, giving rise to serious concerns in the international community. Frankly, I am also worried," Wen said during a joint press conference with German Chancellor Angela Merkel.

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She had travelled to Beijing with half of her government for a joint session with the Chinese government, Germany being the only country with which China holds such meetings.

Despite her reassurances about "absolute political will" to save the euro, Wen expressed concern about the speed of the response.

He pointed to the possibility of Spain and Italy also asking for bailouts as well as uncertainty regarding Greece's future in the eurozone. "The solution depends on the will and decisiveness of the big euro-countries, Germany and France, to help them out."

China will continue to buy European bonds, Wen said, but he did not make any concrete pledges regarding Italy or Spain and noted that any purchases would require a full risk evaluation.

Merkel said she wants Greece to remain in the eurozone and praised Italy and Spain for their reforms. "Both countries are on a very intensive reform path, which I am strongly convinced will bear fruits."

The chancellor's display of power - it is the second time this year she meets with top Chinese officials and signs lucrative deals - such as an order for 50 Airbus planes worth €2.8 billion - is in stark contrast with the yearly EU-China summits which produce statements and pledges for cooperation.

A question about freedom of the press, with increasing restrictions by the Communist Party imposed on foreign correspondents, went unanswered by Wen. As for Merkel, she said: "We have a joint conviction that allowing for fair reporting is a basis for our nations to get to know each other better and to cooperate better."

She also played down a dispute over solar panels, with European producers calling on the EU commission to impose tariffs to punish the Chinese competitors for unfair subsidies received from Beijing.

"Protectionism cannot be the answer for certain difficulties, we have to try to solve existing problems by the way of talks, problems we have in the field of solar energy, for instance," Merkel said.

"We should endeavour to do so because there is still time and we will discuss with our colleagues in the European Union that we should give it a try."

Greece and creditors proclaim 'end of crisis'

After late-night talks, the Eurogroup agreed on a €15bn disbursement and debt relief measures for Greece, while setting out a tight monitoring when the bailout ends in August.

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