Brussels, 27/01/2015 (Agence Europe) - On Tuesday 27 January, European Commissioner for Trade Cecilia Malmström asked China to redouble its efforts alongside the EU in 2015 so as to complete negotiations successfully for a bilateral agreement on investment. The negotiations were started in January 2014.
“This deal therefore offers huge potential (…) In 2015 we will need to step up our efforts. As always, what matters in the end is getting to a high quality deal. That is much more important than getting a quick outcome. But the European Union is ready to work hard on this negotiation this year. I hope China is ready to join us. It is certainly an effort that will be properly repaid”, said Malmström at an EU-China business event. She was taking part in “constructive discussions” at the fourth round of talks last week, in Brussels, which “built on the significant progress made already” in 2014.
This future agreement will replace the 26 bilateral agreements on investment that already exist between the member states and China with “only one set of rules” aiming to guarantee the legal protection of investments (fair trade and non-discrimination, compensation for expropriation and legal security) and reciprocal market access for EU investors and those from China.
On this second objective, the EU aims at the reduction or removal of restrictions to foreign investment on the Chinese market, like the requirements on establishment (joint venture and equity caps), sectoral investment prohibitions through the “investment catalogue”, technology transfer, and local content requirements. “These rules are certainly one of the reasons that investment flows from Europe to China are so far below potential. We welcome China's recent steps to address some of these barriers but much more needs to be done”, Malmström stated.
Europeans and Chinese wants to stimulate investment flows that are still below their potential, given the level of integration between their economies (the EU is China's largest trading partner and China is the EU's second largest trading partner). “China has invested 50% more in sub-Saharan Africa than in the EU, and the EU has invested 20 times more in the USA than in China. This is an anomaly that we need to address”, Malmström concluded. (EH)