The European Union, China's third-largest trading partner, is set to come to a preliminary conclusion on China's year-long request for market economy status (MES).

Beijing-based trade experts say China, after decades of reform and opening up, deserves the status.

"The EU will respond before June on this matter," said an unnamed official from the Ministry of Commerce. No further details are currently available.

Sources from the EU confirmed that it is looking into the Chinese request to be granted MES.

"This request is being examined with high priority and conclusions of the preliminary assessment will be shared with the Chinese side as soon as possible," Annabel Egan, press officer of the Delegation of the European Commission in China, told China Daily.

And she also said it is premature at this stage to advance any possible conclusions of the EU's assessments.

EU foreign affairs and security chief Javier Solana said during his visit to China last month an initial response to the Chinese request for market economy status is due within the next few months, according to Xinhua.

China made the request years ago and renewed its appeal on different occasions.

"After years of opening up and reform, China has basically met the EU's criteria on MES," said Zhou Shijian, a senior trade expert who has often advised government departments and industries in tackling anti-dumping cases.

China has stood by its World Trade Organization (WTO) commitments and has continued to open to the outside world in the last two years, Zhou pointed out.

"About 98 per cent of China's commodities are subject to the market to generate their prices," he said.

Private businesses in China are also playing an increasingly important role in the national economy, he explained.

Chinese enterprises are in a phase of going public and restructuring and these practices are based on a market economy, Zhou said.

Some analysts say the EU might grant China MES in the near future, as many countries have agreed to do so recently.

Some EU members have also given their support to China's request.

Italy will push for the EU to grant China MES, Adolfo Urso, Italian vice-minister for productive activities, told reporters during his visit to Beijing in March.

And improving Sino-EU economic ties can only help this to occur.

Last year two-way trade between China and the EU reached a historic US$125.2 billion, and the bloc - as it grows from 15 to 25 members in May - is very likely to become China's largest trading partner this year.

However, a senior researcher from the Chinese Academy of Social Sciences cautioned that there are still some factors hindering a favorable EU decision. The researcher, who declined to be named, said pressure from Japan and the United States, China's top two trading partners, might delay the process.

An enlarged EU might also mean there will be differing opinions from new members, the researcher said.

At this time, China is defined by the EU as being in transition from a planned to a market-oriented economy.

In response to EU anti-dumping charges, Chinese enterprises have been able to appeal to be granted market economy treatment (MET) since 1998, the year when the EU revised its anti-dumping laws and removed China from its non-market-economy list.

Since then, about 20 Chinese firms have been given MET by the EU, Zhou said.

(China Daily April 16, 2004)