BEIJING, China

THE European Union said yesterday that China has pledged to guarantee the supply of rare earths — minerals essential to high-tech industry — to Europe as the two sides wrapped up high-level economic talks.

Beijing also said it had taken steps to help European governments combat the debt crisis that has been rocking the continent in recent months.

“I made the point very strongly that this (the supply of rare earths) is a major concern to EU business. Any disruption to supplies is totally not to anyone’s benefit. Chinese colleagues reiterated that the supply of rare earths will be sustained,” EU Trade Commissioner Karel De Gucht told reporters following

the talks.

China accounts for 97 per cent of the global production of rare earths, essential to high-tech products such as cellphones, computer drives and hybrid cars. Countries worldwide were alarmed when Beijing blocked shipments of the minerals to Japan earlier this year amid a squabble over disputed islands.

The commitment was made during the third China-EU High-Level Economic and Trade Dialogue, where progress was also made on a possible treaty to increase investment from both sides, he said.

The EU is China’s largest trading partner, while China is the EU’s second-largest trading partner behind the United States. Two-way trade for the first 11 months this year reached US$433.9 billion, an increase of 33 per cent from the previous year.

During the opening of the forum, Vice Premier Wang Qishan said that China had also taken steps to help European nations combat the sovereign debt crisis.

Wang said the two sides “should have confidence and enhance cooperation to work together for a robust, sustainable and balanced growth”, according to the official Xinhua News Agency.

EU Commissioner for Economic and Monetary Affairs Olli Rehn told the news conference that the European Union welcomes the support by China for its measures

to stabilise the ongoing financial crisis.

“Economic recovery has taken hold in the EU. It is progressing and spreading from export growth to domestic demand,” he said.

Several countries in the EU’s so-called periphery have been struggling with high debt loads, and anxiety over their ability to pay back those debts has shaken bond markets in recent months, despite the creation of a 750 billion euro (US$1 trillion) bailout fund for countries that use the euro.

Ireland last month sought a 67.5 billion euro (US$90 billion) loan from the EU and International Monetary Fund, agreeing to implement severe spending cuts as its economy staggered under the weight of massively indebted banks.

The Irish rescue followed the 110 billion euro EU-IMF bailout of Greece earlier this year and added to fears that other financially weak countries including Portugal and Spain would need bailouts, imperiling the future of the common euro currency.

China has supported highly indebted European countries, offering in October to buy Greece’s debt. Last week, Portugal said that China had pledged increased support for its efforts to climb out of a financial crisis, reportedly promising to buy US$4

billion in Portuguese government debt.

Wang said global economic recovery is being hampered by weak demand, while world markets have excessive liquidity and are turbulent.