China wants the EU to recognise it as a market economy. But a new in-depth study by economists confirms that China is far away from being a market economy. Several hundreds of national, regional and sectoral five-year plans, pervasive state control over businesses, subsidies that have doubled over the past five years, and dumped exports financed by state-owned banks – these are only some examples of how the People’s Republic of China controls its industry.
The study published by THINK! DESK China Research & Consulting reveals the extent of China’s state-planned economy in unique detail. Professor Dr. Markus Taube, author of the study, concluded that: “China is not a market economy; state planning and subsidization are in China’s DNA”.
The results of the study were presented to members of the European Parliament by AEGIS EUROPE, an alliance of over 25 European industrial associations among which EUROFER, committed to continued investments in European production and jobs.
The study supports the view that China does not merit the ‘Market Economy Status’. If the EU would grant such status, as requested by China, its ability to act against heavy Chinese dumping would be severely undermined. From the perspective of European industry, over the next few years this would result in the loss of millions of EU jobs, green production and innovation.
Axel Eggert, EUROFER Director General, says that ”In the steel sector, the massive Chinese excess capacities and exports fuelled by pervasive government support and subsidization are a case in point illustrating the distorting impact of China’s planned economy on a global scale.”