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5th Apr 2020

Asian leaders to pressure EU over IMF seats

  • The EU is striving to define its 'strategic' relationship with China (Photo: EUobserver)

The prickly topic of IMF seats is set to come up during talks between EU and Asian leaders in Brussels next week (4-5 October), while trade and currency issues are on the agenda for the following EU-China bilateral summit (6 October).

An additional EU-South Korea summit during the morning of 6 October will see the two sides finally sign a free trade agreement, widely billed as the EU's most ambitious to date but recently subject to last minute wrangling due to concerns over Europe's small car industry.

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The plethora of political meetings will be accompanied by an EU-China business summit on 6 October, together with EU-China cultural summit (6-7 October) which will be chaired by the renowned Italian author Umberto Eco and Chinese researcher Qiu Xigui.

Officials have confirmed that 40 EU and Asian leaders are to attend the EU-ASEM meeting, where global economic governance, sustainable development, combatting piracy at sea and the fight against terrorism are among the main topics on the agenda.

But Europe is also likely to come under pressure to give up seats on the board of the IMF, with emerging markets long complaining that the international lending organisation is overly dominated by Europe and the US.

European directors now occupy nine of the 24 seats, with voting weights and seats still reflecting the relative size of economies when the IMF was created in 1945. A procedural manoeuvre undertaken by the US last month, in which it declined to re-elect the 24-member board in its current form, has ramped up pressure on the Europeans to reduce their number.

"I don't think we will be delivering a solution on this at the ASEM meeting. We will be investigating the various rooms for manoeuvre," a senior EU official said this week. China has said it wants the situation solved by the next G20 meeting in Seoul (11-12 November).

EU-China

European concerns over market access for goods and service, the protection of intellectual property rights and the opening of public procurement markets are set to raised when Commission President Jose Manuel Barroso, European Council President Herman Van Rompuy and Chinese Premier Wen Jiabao sit down for bilateral talks next Wednesday.

European businesses have become increasingly frustrated by the barrage of Chinese regulatory requirements regarding public contracts, which they argue are little more than an attempt by Beijing to favour domestic firms.

German Chancellor Angela Merkel recently said that China must sign the WTO's agreement on public procurement if Chinese firms are to continue to enjoy access to European government contracts.

Another bone of contention between the two sides, the value of China's renminbi currency, will be discussed between Eurogroup President Jean-Claude Juncker, economy commissioner Olli Rehn, and Chinese Premier Wen during separate talks on the morning of the summit.

The discussions come at a time when the EU is increasingly trying to define the nature of its 'strategic' relationship with China. "We are trying to make it more political and shorter," said one EU official referring to the meeting's conclusions.

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