European governments on Monday signaled their support for completing work on an agreement with Beijing to open the Chinese market further to European investors, bringing closer a major economic and political victory for both sides.
National envoys urged the European Commission to complete negotiations with the Chinese government within days, said a European official, who spoke on condition of anonymity because the deliberations in Brussels were confidential.
Another official said that the commission could announce a draft deal imminently.
A successful conclusion of talks that began in 2013 on an EU-China investment accord would be a salvo against the “America First” challenge to the multilateral order by outgoing US President Donald Trump.
For the EU, the deal would expand access to the Chinese market for foreign investors in industries ranging from vehicles to biotechnology. The pact would also tackle underlying Chinese policies deemed by Europe and the US to be market-distorting — industrial subsidies, state control of enterprises and forced technology transfers.
For China, the agreement promises to bolster the nation’s claim to be a mainstream geopolitical force and might limit the risks resulting from a tougher EU stance on Chinese investments in Europe. It would also strengthen Beijing’s longstanding call for the start of negotiations on a free-trade agreement with the EU, which has insisted such a move depended on an investment deal being concluded.
The Chinese Ministry of Foreign Affairs did not immediately comment on the latest developments.
The expected achievement comes after Trump shook the post-war system over the past four years by sidelining the WTO, starting a tariff dispute with China, and hitting or threatening the US’ European allies with controversial import duties.
However, EU-China relations have also been strained this year.
China’s imposition of a new National Security Law on Hong Kong has sparked sharp criticism across Europe, while the EU has accused Beijing of spreading disinformation about the COVID-19 pandemic and targeted China-based operators with the bloc’s first sanctions over cyberattacks.
While the EU and China in April last year pledged to strike an investment accord by the end of this year, the EU had been downplaying the prospect of a deal on the grounds that the Chinese government needed to make more concessions.
Through all the ups and downs, the EU has criticized Trump’s confrontational tactics toward China, and urged Western engagement with Beijing on everything from fighting climate change to overcoming the pandemic.
The planned deal signals the EU’s determination to assert itself and focus on economic opportunities in Asia, even while reaching out to US president-elect Joe Biden in a bid to revive transatlantic cooperation.
China ranked as the second-largest trading partner of the EU last year behind the US, with two-way trading in goods valued at more than 1 billion euros (US$1.2 billion) per day.
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