EU's Ashton urges China on trade, Iran

(BEIJING) - EU foreign policy chief Catherine Ashton urged China Thursday to create a better investment environment for European businesses and maintain a joint stand on the Iranian nuclear issue.

Ashton met Premier Wen Jiabao a day after taking part in the inaugural EU-China High-Level Strategic Dialogue in the southwestern city of Guiyang -- a forum intended to keep the two sides in contact on major issues.

"We talked about the importance of trade and investment," Ashton said.

"I pointed out ... we could build on some of the issues in order to make it more possible for European businesses to invest long-term in China for the benefit of China and the EU."

She said she referred Wen to an EU Chamber of Commerce report issued Thursday that called for greater market access and a level playing field for EU companies in China.

Despite thriving economic ties, relations between China and Europe have been strained by trade disputes amid growing frustration among foreign firms over perceived unfair treatment.

The chamber report said there was a "growing tendency" in sectors such as auto, telecoms and healthcare to block overseas companies from the market, while Ashton said Europe's investment into China "is lower than it should be."

Wen's "response was very positive," Ashton said, "he said he was aware that there was more to be done and that he wanted to create the environment where we have that investment."

Earlier Ashton discussed the Iran nuclear issue with Chinese Foreign Minister Yang Jiechi, including the need to maintain a united front on sanctions imposed on Iran.

Although China backed UN sanctions against Tehran for refusing to freeze its uranium enrichment, Beijing has voiced opposition to additional economic sanctions imposed unilaterally by the United States, the EU and others.

Such opposition has fueled fears that Chinese companies would fill the void created by the sanctions, especially in Iran's lucrative oil and gas sectors.

"I explained to Minister Yang the significance of having a cohesive approach towards Iran," Ashton said.

"The solution is through dialogue, but the sanctions are designed to support that by helping to put the right kind of pressure on Iran to come and have that dialogue. China has a significant role to play in that."

China has emerged as Iran's closest trading partner and has major energy interests in the Islamic republic.

During her talks, Ashton said she also discussed human rights issues and climate change.

China is now Europe's second-biggest trading partner after the United States, according to the EU. China is also Europe's fastest-growing export market.