Against an international backdrop of uncertainty over the decisions to be taken by American President Donald Trump on the withdrawal of the United States from the Paris international climate agreement and disengagement from the multilateral trade system governed by the WTO, EU and Chinese leaders will attempt, at the 19th EU-China summit in Brussels on Thursday 1 and Friday 2 June to consolidate a joint position on free trade and tackling climate change.
“This summit should deliver important signals for multilateralism. It is likely to underline the importance of having a multilateral system with binding standards”, a senior European official told the press on Wednesday 31 May.
Saving the Paris climate agreement. Two major outcomes are expected of this summit, the first being the adoption of a very first joint statement on climate change and clean energy which will set out how the EU and China, which, along with the United States, are among the world’s three largest CO2 emitters, will implement their commitments made as part of the international climate agreement concluded in 2015. “The objective is that the EU and China reiterate their desire to press ahead, whether or not the United States pulls out”, our source said.
Reinvigorating talks on the investment agreement. The second expected result is reiteration by the EU and China of their desire to conclude an investment agreement, where the negotiations, launched in 2013, have remained deadlocked at the start of their second phase, which covers market access, since the conclusion of the interim agreement in January 2016 on the scope of the future agreement. The EU hopes ideally for a timetable to be agreed at the summit so that offers on market access can be exchanged in 2018. “The future investment agreement is the best instrument for ensuring reciprocity on the part of China”, said our source, underlining that many Chinese sectors remain closed to European investment. The latest figures on bilateral investment flows speak volumes: while Chinese investment in Europe has continued to grow, reaching €40 billion in 2016, European investment in China has fallen, totalling only €8 billion last year.
EU more relaxed about market economy status. European Council President Donald Tusk and European Commission President Jean-Claude Juncker, accompanied by EU High Representative for Foreign Affairs and Security Policy Federica Mogherini and Trade Commissioner Cecilia Malmström will host an informal dinner on Thursday evening for Chinese Prime Minister Li Keqiang and his delegation, which will include State Councillor Wang Jiechi and Foreign Minister Wang Yi.
EU and Chinese leaders will meet on Friday for a plenary session devoted to bilateral relations with the focus on trade and investment.
Beyond the bilateral agreement on investment, the two sides will discuss burning issues, such as Chinese overcapacity in steel, aluminium and other sectors, along with market economy status and the treatment of China in EU anti-dumping investigations.
On the first of these points, the EU will press the Chinese authorities to increase the speed of reform in order to encourage fairer market conditions and reduce distortion due to the firm hold the state has on the Chinese economy.
On the second point, the EU will be in a less sensitive position than at the previous summit, now having a proposal on a new method for anti-dumping calculations in order to settle the issue of how China is dealt with in EU anti-dumping investigations after the expiry of the provisions contained in China’s protocol of accession to the WTO. The new method, which seeks to be neutral towards all third countries, looks to identify market distortions resulting from state intervention in these countries and to remedy harm caused to European industry, in line with the rules of the WTO anti-dumping agreement.
China-Europe connectivity will also be on the agenda: the leaders are expected to give priority to the progress made in the EU-China connectivity platform, the goal of which is to coordinate transport policies and identify projects of common interest between the EU and China, on the basis of transparency and fair competition conditions. In this context, the summit will provide a follow-up to the recent New Silk Route forum in Beijing in mid-May.
The leaders are expected to instruct their negotiators to speed up work so that negotiations on an agreement on recognition and protection of geographic indications (GIs) can be concluded by the end of this year. The summit will agree on publication of the names of GIs for each of the parties shortly after the meeting.
On Friday, the plenary session will be followed by a ceremony at which a number of agreements will be signed. These include a memorandum of understanding on the investment framework in relation to the connectivity platform and a memorandum of understanding on dialogue in the area of state aid and fair competition, along with an agreement on intellectual property.
Security cooperation. During the working session, the two sides will discuss cooperation on security and defence, including on peace-keeping in Africa and on increasing cooperation in the fight against terrorism. This cooperation was discussed during the high representative’s visit to Beijing for the 7th meeting of the EU-China strategic dialogue at the end of April (see EUROPE 11771).
While the issue is divisive, the EU intends to use the summit to underline the importance of human rights and the rule of law, which it considers a key element of its engagement with China.
Syria, Korean peninsula and China Sea. Lastly, the summit will close on Friday with a lunch devoted to foreign policy and security issues. The agenda is likely to be dominated by the situation in the Korean peninsula, where security is threatened by North Korea’s increasingly frequent nuclear and ballistic tests. A European source says that these will be important discussions as there are “security worries” for both parties. “It has a direct impact on China and the United Nations might have to take further decisions if the situation continues”, the source said. The UN Security Council, of which China is a member, has several times over the last few months adopted sanctions against Pyongyang over its nuclear and ballistic testing.
The tense situation in the China Sea might also be discussed, after China and the countries of South-East Asia approved a general framework on 18 May for a code of conduct for the South China Sea. Discussions on the situation in Afghanistan, Syria, Ukraine and Libya are also on the agenda. (Original version in French by Emmanuel Hagry and Camille-Cerise Gessant)