Luxembourg, 16/10/2013 (Agence Europe) - In Luxembourg on 18 October, the EU28 gave the go-ahead for the opening of trade talks on an investment agreement between the European Union and China, with the aim of reaching agreement within the next thirty months to encourage bilateral investment, which stood at just over €20 billion in 2011, €17.5 billion of it for the EU.
The EU and China may officially open the negotiations at a bilateral summit in Beijing on 21 and 22 November, with the aim of concluding a deal within thirty months.
The EU negotiating mandate agreed upon on Friday includes a decision from the Council of Ministers and a decision from member states' representatives to the European Union authorising the opening of talks, along with directives on the negotiations proper. The directives are for an agreement on protecting investment (fair and non-discriminatory treatment, legal security and compensation for expropriation) and ensuring better access to the market for EU and Chinese investors. The deal will replace the existing 27 bilateral trade agreements between China and the member states (Ireland is the only member state not to have an investment deal with China at the moment).
In a press release, the EU Council of Ministers says that the main objectives of the agreement are greater protection for European investment in China and Chinese investment in Europe, better legal security for European investors in China and reducing the obstacles to investment in China, and vice versa, thus increasing bilateral investment flow and improving access to the Chinese market. Trade Commissioner Karel De Gucht says it is not simply an agreement on the protection of investment, as most of the talks will focus on the question of access to the market. He said the agreement would only be of interest to the EU if it covered both investment protection and access to the market.
Trade between the EU and China is mammoth, totalling €435 billion in 2012, but investment flows remain below potential. Foreign direct investment (FDI) in China from the EU totalled €17.5 billion in 2011, and Chinese FDI in the EU over the same period totalled €2.8 billion. (EH/transl.fl)