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EU, China Cannot Agree on Currency Measures

From left to right:China's Prime Minister Wen Jiabao, European Union Council President Herman Van Rompuy, and European Union Commission President Jose Manuel Barroso are seen following the signing ceremony of two agreements between the European Union and

The European Union and China have failed to overcome a key currency exchange disagreement during a one-day summit in Brussels. The talks cap three days of meetings between European and Asian leaders.

European and Chinese leaders had warm words during the Brussels summit about their relations and the importance each held for the other.

The president of the council of European Union member states, Herman von Rumpuy, described shared areas of concern between the two regions. "We want to move this relationship forwards in the years to come," he said. "The EU and China have a strategic partnership of the utmost importance."

One of the biggest areas of concern, at least for Europeans, is China's currency, which many believe is undervalued.

European Council President Jose Manuel Barroso outlined Europe's argument. "On the European side we stated our position considering that China's structural reforms should be complemented by an orderly and broad appreciation of the Chinese currency exchange rate. Letting the adjustment fall only on the euro could be damaging for the euro area recovery," he said.

But Chinese Premier Wen Jiabao warned the European Union not to pressure China on rapid currency reforms, saying they would have disastrous consequences domestically and internationally.

The summit between the two regions capped three days of talks in Brussels that began with a larger Euro-Asia summit and ended with a free-trade agreement signed between South Korea and the 27-member European Union.

The summit also saw an informal meeting between Chinese and Japanese prime ministers, during which both sides agreed to improve ties that have eroded sharply over a territorial dispute. European and Asian leaders also called for an urgent, legally binding agreement to fight global warming.