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POLITICAL ECONOMY
Euro crisis to top agenda of Merkel's visit to China
by Staff Writers
Berlin (AFP) Jan 31, 2012


The eurozone debt crisis, Iran and Syria will be among the topics up for discussion when German Chancellor Angela Merkel makes a two-day trip to China this week, government sources said Tuesday.

In her fifth visit to the world's number two economy, accompanied this time by a 20-strong trade delegation, Merkel is to arrive Thursday for talks with Premier Wen Jiabao and President Hu Jintao in Beijing where she will be welcomed with military honours.

The German leader will then make a key address on the euro crisis to the Chinese Academy of Social Sciences.

Germany and China, the world's top two exporters, enjoy vibrant trade relations and China will be this year's partner country at Hanover Fair, the world's biggest industrial fair in the northern German city in April.

This year also marks the 40th year of diplomatic relations between the two countries.

"We've achieved a great deal with China in recent years," Merkel said in her weekly video podcast on Saturday.

Last year, for example, saw the establishment of government consultations between Berlin and Beijing, and Wen and 13 ministers travelled to the German capital for talks with Merkel.

"The priority now is to follow up on what we agreed at those first consultations," the German leader said.

With an eye on an EU-China summit in mid-February, Merkel will meet investors and canvass for increased confidence in Europe, a government source said.

"China has repeatedly stressed its interest in a stable euro. It is in China's interests, too, that Europe return to growth," the source said.

Similarly, there will also be discussions on possible increased Chinese involvement in the International Monetary Fund.

With regard to trade, while no major contracts look set to be signed during the trip, talks will focus on access to the Chinese market, investment and intellectual property rights.

"Bilateral trade is good but for all sorts of reasons there are problems at the investment level. Europeans think that China lacks transparency on intellectual property rights," said Liu Zuokui, a researcher at the Chinese Academy of Social Sciences.

On the second day of the visit, Merkel will be accompanied by Wen and corporate executives from the energy, chemicals, engineering, banking and electronic sectors to Guandong, economically the strongest of China's provinces where nearly 500 German companies are already present.

On the agenda will be so-called rare earths which are used in the production of high-tech products and which are of "very great importance for the German economy," the source said.

Among the political topics to be discussed, Merkel will urge China not to use Europe's ban on Iranian oil to boost its own imports.

And the German leader will also ask for Beijing's support for a UN Security Council resolution against Syria.

Human rights will also figure highly on the trip, with Merkel keen to talk about minority issues and social development in China, the source said.

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