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By Sarah Marsh

BERLIN (Reuters) – European Commission President Ursula von der Leyen said on Thursday that a key goal of the EU summit with China in Beijing in December was to achieve a level playing field in trade in light of market distortions.

As one example, von der Leyen said Chinese overcapacity in the clean tech sector was set to worsen and be exported as its economy slowed down, worsening distortions in the EU market – which the bloc could not accept.

China’s trade surplus with the EU was the highest in history last year, just below 400 billion euros ($434.96 billion), she said.

“We do not accept distortion from the inside, we should not accept it from the outside either,” she told a conference on China in Berlin, noting this was why the EU had launched an investigation into imports of Chinese electric vehicles.

“Europe is open for competition. Not for a race to the bottom.”

Von der Leyen said, however, that as much as the EU would protect its interests, it would also seek to address disagreements with China through dialogue – for example at their Dec. 7-8 summit, which comes after U.S. President Joe Biden met this week with Chinese President Xi Jinping.

“Our goal is to achieve a level playing field in our trade relationship with China,” said the official, who has driven recent European efforts to “de-risk” from Asia’s rising superpower.

“We will go to China in good faith,” said von der Leyen. “We will never be shy in raising our concerns. But we must leave space for a discussion on a more ambitious relationship that benefits both of sides.”

Von der Leyen said she expected action from China to deal with the current imbalances.

“The story of how we relate to China is not yet fully written. Nothing is predetermined, we have agency and China is capable of change.”

($1 = 0.9196 euros)

(Reporting by Sarah Marsh; Editing by Miranda Murray and Sharon Singleton)

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