For Europe, China is making trade impossible

Europeans have nothing to offer and difficult decisions to make.

- Robin Harding

On a recent trip to China, I found myself posing the same question, again and again, to the economists, technologists and business leaders who I met.

“Trade is an exchange. You provide something of value to me, and in return, I must offer something of value to you. So what is the product, in the future, that China would like to buy from the rest of the world?”

The answers were revealing. A few said “soya beans and iron ore” before realising this was not much help to a European. Some observed that Louis Vuitton handbags are popular, and then went on to talk about the export prospects for fast-rising Chinese luxury brands. “Higher education” was another common answer, qualified sometimes with the observation that Peking University and Tsinghua are harder to get into, and more academically rigorous, than anything on offer in the West.

Several of the economists, who had perhaps pondered the issue already, jumped ahead to a different point altogether: “This,” they said, “is why you should let Chinese companies set up factories in Europe.”

It is a train of thought that gives way the real answer to the question. Which is: nothing.

There is nothing that China wants to import, nothing it does not believe it can make better and cheaper, nothing for which it wants to rely on foreigners a single day longer than it has to.