Wen Jiabao in Iceland, Sweden

Chinese Premier Wen Jiabao has started his current European tour from Iceland. His visit in the region is tied to China’s increasing interest in the matters of the Arctic region. Wen told local news that Sino-Icelandic relations are to be taken to a new level. The recent denial by Iceland’s government of a multi-million investment from a Chinese billionaire has been a thorn in the side as of late.

It seems that the two countries will reach some sort of an accord on Arctic cooperation during this two-day visit. An initial discussion into a free-trade agreement is also on the agenda. China is also much more interested in food safety and thus food imports, the tariffs of which were just lowered, and just these days, reports of oilfish being sold as cod has been in the news. This might be a good opportunity for exports of Icelandic cod to gain a foothold in the market.

Iceland was ahead of the curve in recognizing China as a full market economy and gained much appreciation from that stance in China. Geothermal energy transformation is another area of interest for the Chinese.

Wen, who is revered in China for his hands-on approach in the problems of the ordinary people, is also visiting Sweden later on in his current tour. The local media has reported that Sweden is supporting China’s position as a permanent observer at the Arctic Council, a position that Norway may use veto against. Norway had previously been hoping to be the first European country to sign a free trade pact with China.