End to China arms embargo bad for trade, says US

RIGA - US Deputy Secretary of State Robert Zoellick said if the European Union ended a ban on selling arms to China it would affect its transatlantic defence trade with the United States.

EU leaders have repeatedly voiced support for lifting the embargo, which was imposed after the bloody crackdown on pro-democracy protesters in Tiananmen Square in 1989. But the European bloc wants to ensure its US interests would not be hit by the move.

"It would certainly affect our transatlantic defence trade because the types of arrangements that we have had with defence firms in Europe would be upset," Zoellick said in Latvia during an official visit to the Baltic state.

Several countries, especially the United States and Britain, have been critical of the plan to lift the arms embargo, notably in the light of rising Chinese tensions with Taiwan.

Zoellick did not mention specifics but a number of British firms have bought US companies, including BAE Systems. US groups including General Dynamics and Lockheed Martin also have investments in the British defence sector.

"I think some of the opportunities and the integration that we have seen develop would be inhibited by this," Zoellick said.

Zoellick's remarks follow comments from French President Jacques Chirac quoted on China's official Xinhua news agency.

Chirac told President Hu Jintao by telephone the embargo was outdated and should be revoked, the agency said on Friday.

Hu said the embargo had become increasingly inappropriate and that lifting it would help promote relations between China and the European Union, the report said.

German Chancellor Gerhard Schroeder told a German newspaper last week that he was determined to relax the EU's arms embargo against China despite possible opposition from parliament.

"We think that a move to lift the arms embargo would be a mistake," Zoellick said. "For some of us, like myself coming out of the trade industry who have worked hard to create additional opportunities, this would not be a positive move."

Last month, Chirac said EU countries would not start selling weapons to China if they lifted the embargo and his support for lifting the ban was aimed at normalising relations with China.

- REUTERS