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Published: Tuesday December 3, 2013 MYT 2:05:12 AM
Updated: Tuesday December 3, 2013 MYT 2:05:15 AM

Cameron clashes with Brussels over EU-China trade

China's President Xi Jinping (R) shakes hands with Britain's Prime Minister David Cameron in front of Chinese and British flags during a meeting at Diaoyutai State Guesthouse in Beijing December 2, 2013. REUTERS/Ju Peng/Xinhua

China's President Xi Jinping (R) shakes hands with Britain's Prime Minister David Cameron in front of Chinese and British flags during a meeting at Diaoyutai State Guesthouse in Beijing December 2, 2013. REUTERS/Ju Peng/Xinhua

BEIJING (Reuters) - British Prime Minister David Cameron promised China's leaders on Monday he would advocate a multi-billion-dollar free trade deal between Beijing and the European Union, riling the EU executive which rejected the move as premature.

On a three-day visit with around 100 business people, the largest-ever British mission of its kind, Cameron said Britain was the Western country most open to Chinese investment and well-placed to take advantage of China's market liberalisation.

"China's transformation is one of the defining facts of our lifetime ... I see China's rise as an opportunity, not just for the people of this country but for Britain and the world," Cameron told reporters after meeting Premier Li Keqiang at the Great Hall of the People in Beijing.

China is the world's second largest economy, after the United States.

Cameron, who later met President Xi Jinping, cast Britain as far more progressive on trade than other EU member states in remarks that stirred a spat with Brussels over the issue.

"Some in Europe and elsewhere see the world changing and want to shut China off behind a bamboo curtain of trade barriers," said Cameron. "Britain wants to tear those trade barriers down."

His approach irritated the European Commission, which is privately understood to oppose a trade deal on the grounds that it risks flooding the 28-nation bloc with cheap Chinese imports.

"We believe that it is premature at this stage to discuss a free trade agreement with China," Alexandre Polack, a spokesman for the EU executive, told reporters.

He said the EU and China were already discussing a possible investment agreement and should stick to that for now.

At home, Cameron's trade initiative is likely to be seized on by opponents as he has placed a question mark over Britain's EU membership by promising a referendum on leaving the bloc if re-elected in 2015. That sits awkwardly with his campaign to help broker a deal for a club his country may soon leave.

"I've said to Premier Li that I will champion an EU-China trade deal with as much determination as I'm championing the EU-U.S. trade deal," Cameron said.

Li said both sides had agreed to fight protectionism and push for trade and investment liberalisation. China, he said, welcomed Britain's open attitude to Chinese investment.

He added that there had been a "breakthrough" between firms on both sides on high-speed rail, but gave no details.

One person familiar with the matter said China had offered to play a role in plans for a high-speed rail link, dubbed HS2, between London and the north of England.

HUMAN RIGHTS

British finance minister George Osborne opened the door to further Chinese investment during a visit to Beijing last month. He announced less stringent rules for Chinese banks operating in London, in a push to make the British capital the main offshore hub for trading in China's currency and bonds.

Osborne also paved the way for Chinese investors to take majority stakes in future British nuclear plants.

Campaigners have often accused Cameron of putting trade before human rights. On this trip, activists wanted him to raise what they described as rights abuses in Tibet.

A senior source in his office said before the trip that Britain had turned the page on a rift with China over Tibet, and that Cameron had no plans to meet the Dalai Lama, Tibet's exiled spiritual leader, again.

An encounter last year angered Beijing.

Asked after his meetings whether he had raised Tibet or China's imprisoned Nobel Peace Prize winner Liu Xiaobo in his talks, Cameron said he had spoken "about all those issues", but declined to go into detail.

He denied that such trade trips presented a stark choice between trade and human rights advocacy. "I raise them both. That's what a policy of engagement is all about," he said.

Cameron also brought up GlaxoSmithKline's problems in China - where it is being investigated for alleged bribery - with political leaders as the drugmaker emphasised its commitment to doing business there.

Cameron had earlier visited a training academy for Jaguar Land Rover sales staff as the carmaker unveiled a deal worth 4.5 billion pounds ($7.38 billion) to provide 100,000 cars to the National Sales Company in China.

England's Premier League also announced an agreement with the Chinese Super League to develop football in China.

(Additional reporting by Charlie Dunmore in Brussels; Editing by Mark Heinrich)

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