From the Investment Agreement with the EU, China aims to normal trade relations with the US

From the agreement with the EU, China aims to normal trade relations with the US

With commitments paving the way in the EU Investment Agreement, China hopes to restore normal trade relations with the US with some conditions attached.

According to the European Council, China is committed to unprecedented market openness for EU investors, creating a solid and predictable environment for European businesses to operate. Photo: Reuters

Distorted behavior is prohibited

China and the European Union (EU) ended on December 30 negotiating an investment agreement, when less than a month from now, US President-elect Joe Biden officially took office.

“Comprehensive agreement on investment” that China and EU have just concluded negotiations is expected to help businesses of the two sides pave the way to access each other’s market.

The investment agreement negotiations between China and the EU have been delayed before the US presidential election in November 2020.

China and the EU then quickly pushed the Investment Agreement along with speculation that US President-elect Joe Biden would use the support of traditional allies to put pressure on China after he took office. on January 20, 2021, in stark contrast to the strategy of the outgoing President Donald Trump.

The EU wants to complete an investment agreement with China before German Chancellor Angela Merkel ends her term in 2021, according to sources from the EU Chamber of Commerce in China.

The European Commission (EU) and China have agreed to prohibit “distorting acts”, such as forcing European enterprises to transfer technology registered for protection if they want to enter the Chinese market. .

“China is committed to unprecedented market openness for investors from the EU, creating a firm and predictable environment for European businesses to operate,” the Council of Europe said in its statement. Dad recently.

“The agreement (EU-China Investment Agreement) will significantly improve the level playing field for investors from the EU with the elimination of obligations to Chinese state-owned enterprises, forced technology transfer and other regulations distort the market, while increasing transparency of subsidies, “said the Council of Europe statement.

Pave the way for normal trade relations with the US

The Chinese side urged the EU to unify many conflicting issues, most of which have been asked by the US to respond to China. The US and China have been trapped in a trade war for more than two years due to disagreements regarding technology, finance and many other issues that have not been fully resolved.

During a press conference on the evening of December 30, Chinese Ministry of Commerce spokesman Gao Feng “green light” that an investment agreement between China and the EU could pave the way to restore normal trade relations with the US, but with certain conditions.

One of the reasons for the rising US-China conflict is that China does not meet the conditions that US negotiators initially expected.

“The bottom line is that the EU and the US will coordinate better in regulating relations with China; I think with the Biden administration this is really promising,” said Fred Kempe, President and CEO. The Atlantic Council, an organization that brings together foreign policy and public policy experts in the US, said.

According to the Peterson Institute for International Economic Research, Beijing has failed to comply with its commitments to import US goods under the US-China trade agreement phase 1 that the two sides signed in January 2020. The Phase 1 agreement is like a “ceasefire” in the US-China trade war, it is expected to create more favorable conditions for US businesses to enter the Chinese market, especially in the financial sector.

Meanwhile, the process of promoting the US-China trade agreement phase 2 is still delayed in the context of the Covid-19 pandemic.

Analysts predict that Beijing wants to reach a bigger deal with the US so that the two sides can diversify their trading partners and create new strategies to approach the US under President Joe Biden.

Efforts to diversify trade partners are evident when China signed a Regional Comprehensive Economic Partnership (RCEP) with 14 other countries, but not in the United States.

In early 2017, the US was expected to be a pioneer in promoting the Trans-Pacific Agreement (TPP) without the participation of China, but US President Donald Trump quickly withdrew from the TPP after taking office. .

Talking at the meeting on the evening of December 30, Chinese Ministry of Commerce spokesman Gao Feng expressed his hope about agreements with other countries, especially emphasizing the plan to promote a new trade agreement with Japan. and Korea.

China wants to deepen its existing agreements with other countries, including: Singapore, Chile, New Zealand, Gao Feng added.

However, Mr. Gao did not mention a trade agreement with Australia – one of the few developed countries with a trade surplus with the world’s second largest economy. In 2020, Australia incensed Beijing when it joined other countries to participate in the Covid-19 origin investigation.

“Not the deal dealing with America”

The EU-China Investment Agreement promotion process has been around for about 7 years, but this agreement still needs time for translation and final review before being signed.

The EU side believes that the ripple in this agreement is the issue of forced labor in the Xinjiang autonomous region, China, while China has committed to promoting ratification of the International Labor Organization (ILO) conventions. ), including the Forced Labor Convention.

Joerg Wuttke, President of the European Chamber of Commerce in China, said: “The European side thinks it’s really a bilateral issue. It’s an attempt to end negotiations. And this is not a counter-agreement. vice US “.

The negotiation results show that there has been a real improvement in enabling European businesses to access the Chinese market, emphasized Joerg Wuttke, and revealed that there will be more open regulations for home. Investments / businesses in access to Chinese sectors such as electric vehicle development, renewable energy, and finance.

Ms. Li Yongjie, a treaty and legal officer at the Ministry of Commerce, said that the EU-China Investment Agreement will trigger more European investment inflows into services and non-services sectors. industry, especially the automotive, medical (hospital) and information technology industries.

The EU – China investment agreement also provides legal commitments binding China on access to the European market.