Peter Mandelson said investment by European companies in China was actually falling despite the country's growth and the EU might take up some of the obstacles to investment at the World Trade Organisation.

“On the street and in the boardroom, there is a growing sense in China that we are now strong enough to do it all alone which I think is wrong,” Mr Mandelson said in an interview yesterday, although he added this sentiment was not shared by senior leaders in Beijing. “China needs European investment and the technologies, management skills and capital that it brings,” he said.

The obstacles facing European companies were not only theft of intellectual property, but also an “unpredictable” policy for mergers and acquisitions and barriers to market entry including capital requirements, licensing and forced joint ventures. He said he raised with Chinese officials yesterday the fact foreign car companies could only enter China by means of a 50-50 joint venture with a local company.