Brussels, 15/10/2013 (Agence Europe) - As well as the preparation for the third Eastern Partnership summit, the Council will focus, on 18 October, on the negotiating mandate for an EU-China investment agreement.
Boosting Chinese-European investment. Just like last month's meeting, which led to the launch of the transatlantic negotiations (TTIP), the meeting of the European trade ministers in Luxembourg on 18 October is surrounded by high expectations - the 28 EU member states are due to give their green light to the launch of negotiations for an investment agreement between the EU and China. Their decision will authorise the opening of talks and will be completed by negotiating guidelines for the European Commission.
Aiming to secure mutual investment between the EU and China, this agreement is intended to replace the current 27 bilateral investment agreements (only Ireland has so far not had one). The agreement aims to improve the protection of investments (non discrimination, compensation in cases of expropriation, and legal security) and to remove the obstacles to their respective markets. “Market access is the key component”, states a source close to the issue, before adding: “China has a catalogue of restrictions [to foreign investment]. We want to remove some of them.”
While trade in goods between the EU and China is enormous (€435 billion in 2012), investment flows remain below their potential. EU foreign direct investment (FDI) in China stood at €17.5 billion in 2011, while that of China to the EU stood at €2.8 billion.
Strengthening trade with eastern neighbours. On Friday, the ministers will give an update on their trade relations with the Eastern Partnership countries (Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine), ahead of the summit in Vilnius on 28-29 November, which is due to result in the signature of an association agreement between the EU and Ukraine, including an agreement on a free trade area. While the conditions that Ukraine still has to meet remain political (see EUROPE 10929), De Gucht recently reminded Kiev of the grievances that the EU holds with regard both to some restrictions to trade and to the worsening of the investment climate in the country (see EUROPE 10934).
The Vilnius summit is also due to result in the initialling of agreements for free trade areas with Georgia and Moldova - agreements which have been completed in recent months. By contrast, a similar agreement made with Armenia will not be initialled as Erevan decided in September to join the customs union formed with Belarus, Kazakhstan and Russia. Tension with Moscow, which looks badly upon the rapprochement between the EU and the former USSR republics (see EUROPE 10939), will also be tackled by the EU trade ministers.
Stimulating investment in East Asia. Lastly, the Council will adopt amendments to the negotiating directives with the ASEAN. Although bloc to bloc negotiations have been frozen since 2008, the EU is negotiating individual free trade agreements with Malaysia, Thailand and Vietnam. The European Commission would like to see its negotiating mandate broadened to negotiate ambitious chapters on investment for each of the agreements. This negotiating directive was amended in 2010 to allow the negotiation of a chapter on investment with Singapore. Although the negotiations with Singapore have been completed since 2012, and although the agreement was initialled on 20 September (see EUROPE 10926), the negotiations on the investment chapter are only now nearing the end. “We are nearly there”, assured a source close to the issue. (EH/transl.fl)