US and EU face 'common' China challenge, says US official

He noted that China "is putting emphasis on state-owned enterprises, on the involvement of the Communist party into the business sectors" and that "heavy subsidies distort the allocation of capital."

He added that Chinese authorities were "very aggressive" in the use of credit agencies as well as regarding intellectual property. "They need to stop their practice of forcing business that involves the transfer of the property to China, or the lack of protection for intellectual property as its used within companies," he added.

Malpass, who spoke to a group of journalists between meetings with EU officials, noted that accelerating world growth gave the EU and the US "an opportunity to work together on challenges."

"China is certainly one which presents a common challenge for the US and Europe in terms of its investment practices, its trade practices and its own moving away from market liberalisation," he said.

He insisted that the US was looking "free, fair and reciprocal" trade relationships but that "with China, one of the problems is there is not reciprocity."

The US official also noted the US and "other countries have a common interest in more transparency from China and that extends into steel."

Malpass made his comments three weeks after Donald Trump's administration published its National Security Strategy in which China was described, with Russia, as a "revisionist" power threatening US supremacy.

In the strategy's chapter on Europe, the Trump administration said that it would work with the EU "to contest China's unfair trade and economic practices and restrict its acquisition of sensitive technologies."

Last year, the EU launched plans to screen Chinese investment in strategic sectors and introduced new rules on dumping that angered Beijing.

Malpass's comments also come on the heels of a visit to China by French president Emmanuel Macron, where he stressed the need for more reciprocity in EU-China economic and trade relationships.

Malpass, who was one of Trump's economic advisers during his presidential campaign, however stressed "the limits of multilateralism."

He said that "in some areas, we have gone too far" and that "too much multilateralism impedes the growth process."

"We'd like too see more modesty in the international organisations as far as what they can accomplish versus what really comes out of the people of the various countries operating on their own for their own advancement," he said.



He added that the US wanted "less expensiveness in terms of [international organisations'] demands on taxpayers around the world."

The US official defended Trump's decision to abandon the Trans-Pacific Partnership (TPP) signed by his predecessor Barack Obama.

 He said that it would have been "wishful thinking" to expect the trade deal, which did not include China, "would have pulled China more into the world trade system."

"The world has tried to give China opportunity to be a market-based economy, but it is not moving in that direction now," he said.