What the future holds for the EU – China relations?

José Manuel Barroso, President of the European Commission, and several Members of the College received Xi Jinping, President of the People's Republic of China (on the right). It was the first official visit to the European Union by the latter but also the first visit ever by a Chinese President to EU institutions. Handshake between Xi Jinping and José Manuel Barroso, in the presence of Herman van Rompuy President of the Council (in the centre). (EC Audiovisual Servises, 31/03/2014).

José Manuel Barroso, President of the European Commission, and several Members of the College received Xi Jinping, President of the People’s Republic of China (on the right). It was the first official visit to the European Union by the latter but also the first visit ever by a Chinese President to EU institutions. Handshake between Xi Jinping and José Manuel Barroso, in the presence of Herman van Rompuy President of the Council (in the centre). (EC Audiovisual services, 31/03/2014).

EU and China relations are perfectly depicted in a passage from a European Union External Action service Press release issued recently. It says, “While acknowledging China’s advancement of the economic and social wellbeing of its people in the past 25 years, the EU also hopes to see greater space open up for discussion and debate about China’s recent history and for lawyers, human rights defenders and journalists to carry out their work without harassment or interference”.

In any case the fact remains that China is the EU’s biggest source of imports and has become one of the EU’s fastest growing export markets. China and Europe now trade goods of a value well over € 1 billion a day. EU imports from China are mainly industrial and consumer goods. At the same time their bilateral trade in services amounts to just one tenth of trade in goods. According to the EU Commission in 2013, EU exports to China increased by 2.9% to €148.1bn, while the EU imported €279.9bn worth of goods in 2013 (down by 4% compared to 2012). Hundreds of thousands of jobs depend on those relations and consequently both sides are very watchful on the other side’s actions.

Trade is the king

Undoubtedly the huge economic exchanges between Europe and China play the most vital role in their overall relations. This observation is supported by the fact that the setting of the institutional environment and the management of their bilateral all-important trade has been bestowed exclusively to the Brussels authorities. The EU member states cannot sign separate bilateral economic agreements with the Asian giant. Member states are very cautious even while touching issues like human rights thought to be a sensitive subject for the Chinese, with strong impact on the overall relations.

This said, the Brussels authorities overseeing the trade between the two entities, have traditionally paid special attention to effectively support the interests of the EU member states. This past week the relevant EU services announced that China finally agreed to terminate the investigations into European wine exports. This investigation threatened to penalize the quite important and growing sales of this special EU product. Wine is of special interest in all core EU member states. In the same line of action the Commission rushed last year to rather bluntly protect the European solar panel producing industry against the Chinese exports.

Unduly ‘use’ of human rights issues

On many occasions, the Brussels authorities also ‘use’ the very sensitive to the Chinese human rights issues or some burning political topics like Tibet. They transform them into additional ‘ammunition’ in the always visible frictions over various trade topics. This is a practice introduced many years ago by the US, with Washington ‘using’ to this effect its special relations with the Dalai Lama. (As if the human rights of a colored youth in the streets of New York’s Bronx are better protected against the local police, than the rights of a Tibetan tribesman vis-à-vis the Chinese authorities).

On many occasions lately, the European Union authorities and institutions used the American methods, while confronting their Chinese counterparts. Invariably such matters offer lots of opportunities for political criticism, given China’s autocratic administrative, policing and governance practices. It’s very characteristic though that on the day the Chinese President Xi Jinping visited Brussels at the end of March, on the same day a high level representation of the European Economic and Social Committee participated in a demonstration for human rights in China.

No much attention was paid by the EESC to the subject matter of the visit which was nothing less than the EU-China investment agreement. This is a very important affair waiting to be promoted during President Xi Jinping visit in Brussels on 31 March. The agreement in question is expected to “boost bilateral investment flows by opening up markets as well as by establishing a legal framework of investment protection in order to enhance legal certainty and predictability for long-term investment relations between the EU and China”.

Of paramount economic interest

Cynically enough, the EU-China relations are so deep and wide that can’t be seriously threatened by frictions about human rights. The far-reaching effects of the trade and otherwise economic relations are so important, that touch the everyday lives of hundreds of millions of peoples in both sides. The wide diversity of economic relations of the two entities produces everyday new agreements. On 16 May the EU and China signed a landmark mutual recognition agreement which intensifies their customs cooperation.

In the framework of this new agreement EU and Chinese ‘trusted traders’ will enjoy lower costs, simplified procedures and greater predictability in their activities. ”Under the agreement, the EU and China commit to recognising each other’s certified safe traders, thereby allowing these companies to benefit from faster controls and reduced administration for customs clearance. The EU is the first trading partner to enter into such an agreement with China, having already signed similar deals with the USA (2012) and Japan (2011)”.

The TTIP and China

Last but not least the two sides must be presently exploiting the side effects on their bilateral economic relations, from the currently under negotiation EU-US Transatlantic Free Trade Agreement (TTIP). Last week in Berlin Karel De Gucht European Commissioner for Trade delivered a speech entitled “EU Trade Policy as a Means to Influence Globalization”. He more or less explicitly stated Europe’s stance on this issue. De Gucht explained, “Finally, its (TTIP’s) geostrategic implications are important. An agreement between the two largest economies in the world, the US and the EU, has the potential to be a benchmark for talks with a wider range of partners elsewhere. This means that TTIP will be an important way for us to shape regulations, norms, including on investment, and ultimately values that govern economic exchange worldwide”.

In short the EU is to use its TTIP with the US as a measure against which all the other trade agreements of the Union must comply. The EU Commissioner had more to say “…all our bilateral trade agreements … address the difficult issue of social labour and environmental standards – and recognise that trade and investment should not be promoted at the expense of labour rights or environmental regulation. At the same time, our Free Trade Agreements (FTAs) are part of the overall institutional relations with our partner countries, which in turn require respect for human rights. In our agreements, the human rights clauses constitute a so-called ‘essential element’. This means that the non-implementation of human rights obligations can ultimately lead to the suspension of the trade agreement”.

No FTA with China in sight

This is tantamount as saying that an FTA with China is presently impossible. On top of that a possible in the future EU-China free trade and investment agreement will have to comply with the principles set by the EU-US TTIP. This may be an early message, but if De Gucht expresses authentically the views of the core EU countries, it becomes clear that an FTA between EU and China is not within sight. On the contrary the EU is deeply engaged in talks with Japan for one.

All in all, the present basic institutional framework for the EU-China bilateral economic relations will basically remain the same in the foreseeable future. It will continue to be regulated by the WTO rules. The rare earths case is a strong witness of that. The EU Jointly with the US and Japan, successfully challenged in the WTO’s Dispute Settlement Mechanism China’s restrictions on access to rare earths and other raw materials. There may be more special agreements between the EU and China, but the WTO will remain the basic institutional framework for their economic relations.

 

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

the European Sting Milestones

Featured Stings

Stopping antimicrobial resistance would cost just USD 2 per person a year

Bram in Colombia

ECB indicates south Europeans can endure more austerity

Stronger European Border and Coast Guard to secure EU’s borders

Greece: Tsipras’ referendum victory does not solve the financial stalemate of the country and its banks

The Parliament rejects cultivating the wrong seeds of the Commission

2nd Global Consultation on Migrant Health 21-23 February 2017 in Sri Lanka

2021-2027 EU Budget: €378,1 billion to benefit all regions

Indonesia: Psychological impact on earthquake survivors turns villages into ‘ghost towns’

The Tears of lovely Memories

Migrants: ‘A powerful driver’ of economic growth, ‘dynamism and understanding’

How wealthy people transmit this advantage to their children and grand children

G20 LIVE: “Our response needs to be robust…otherwise we will only find the fire we are trying to put out”, UN Secretary General Ban Ki-moon just lit up G20 in Antalya Turkey

‘Unconscionable’ to kill aid workers, civilians: UN Emergency Coordinator

Commission supports normalisation in Greece through activation of post-programme framework

From UN Assembly podium, Central African Republic leader appeals for lifting arms embargo

The refugee crisis brings to light EU’s most horrible flaws and nightmares

EU: Huge surplus in the trade of services with the rest of the world

Macron’s Presidency: what the young generation’s expectations are

Parliament backs a modernised EU electoral law

EU Visa Policy: Commission welcomes agreement to strengthen EU visa rules

Good grub: why we might be eating insects soon

How to stay in shape and step up support for refugees

IMAGINATION, FACTS AND OPPORTUNITIES – THE UNLIMITED POWER OF CHINA

Everyone has ‘a moral imperative’ to uphold the rights of persons with disabilities, says UN chief

Starbucks and FIAT again under Commission’s microscope: is Europe ready to kick multinationals out of the house?

Roxane in Cambodia

The US + Britain trivialize mainland Europe, NATO and the EU

Nearly four million North Koreans in urgent need, as food production slumps by almost 10 per cent

CO2 can be a valuable raw material, not just a climate killer. Here’s how

In Chad, top UN officials say humanitarian response must go ‘hand in hand’ with longer-term recovery

These are the best cities for tech

Teenage girl’s death sentence spotlights Sudan’s failure to tackle forced marriage, gender-based violence – UN rights office

Yemen war: UN-backed talks to silence the guns due to begin in Stockholm

New Zealand will have a new ‘well-being budget,’ says Jacinda Ardern

The Commission neglects the services sector and favours industry

AI can wreak havoc if left unchecked by humans

8000 young people in the EP in Strasbourg: “a breath of fresh air for EU democracy”

These countries are home to the highest proportion of refugees in the world

Guinea-Bissau needs ‘genuinely free and fair elections’ to break cycle of instability

EU: Centralised economic governance and bank supervision may lead to new crisis

EU and Amazon cut deal to end antitrust investigation over e-books deals

More state aid to big firms, no special provisions for the SMEs

Ten UN peacekeepers killed in a terrorist attack in northern Mali

Afghanistan: UN envoy urges further extension of ceasefire with Taliban, as Eid ul-Fitr gets underway

Food for millions in Yemen at risk of rotting in key Red Sea port, warns UN

UN experts cite ‘possible exploitation’ of workers hired to clean up toxic Japanese nuclear plant

New phenomena in the EU labour market

The EU Commission fails to draw the right conclusions about corruption

Intel @ European Business Summit 2014: Better decisions now, the new business dashboard 

UN chief appeals for calm as Mali presidential election draws to a close

‘No country, no region’ can tackle global challenges alone says UN’s Mohammed

The EU Commission vies to screen Chinese investment in Europe

The European Parliament hemicycle in Strasbourg (Copyright: European Union, 2017 / Source: EC - Audiovisual Service / Photo: Mauro Bottaro)

EU Parliament sends controversial copyright law reform back to discussion

How energy infrastructure is shaping geopolitics in East Asia

How smart tech helps cities fight terrorism and crime

Ηealth’s foundation is falling apart: what can we do about it?

With 10 million Yemenis ‘one step away from famine’, donors pledge $2.6 billion

US must abide by humanitarian refugee accords: UN refugee agency

France pushes UK to stay and Germany to pay

World Health Organisation and medical students: is there any room for improvement?

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s