On December 30, 2020, the leaders of China and the EU jointly announced the completion of the China-EU investment agreement negotiations as scheduled.
Since its inception in 2013, 35 rounds of negotiations have been held so far for 7 years.
The China-EU Investment Agreement covers areas far beyond traditional bilateral investment agreements. The results of the negotiations cover four aspects: market access commitments, fair competition rules, sustainable development and dispute settlement.
The China-EU Investment Agreement will strongly stimulate the recovery of the world economy in the post-epidemic period, promote global trade and investment liberalization and facilitation, strengthen the international community’s confidence in economic globalization and free trade, and make an important contribution to the construction of an open world economy in the two major markets of China and Europe. .
At present, the EU is China's second largest trading partner after ASEAN. This year, China has become the EU's largest trading partner.
Why is the China-EU Investment Agreement so important?
What benefits will it bring to Chinese and European companies?
Benefiting nearly a quarter of the global population
According to statistics, China's population is currently about 1.4 billion, the EU population is 440 million (statistics in October 2020), and the total population of Central Europe exceeds 1.8 billion, accounting for more than 24% of the world's population.
The signing of the China-EU Investment Agreement will benefit nearly a quarter of the world’s population.
The "gold content" of China's trade continues to increase
Before Britain leaves the European Union on January 31, 2020, the European Union has maintained China's largest trading partner and source of imports for 16 consecutive years.
Since China's accession to the WTO in 2001, trade in goods between China and Europe has increased from US$76.6 billion to US$705.1 billion in 2019. The average trade volume now exceeds US$1 million per minute.
From January to November 2020, Sino-European trade bucked the trend and grew by 3.5%, showing strong resilience.
In the first 11 months of 2020, the total trade value between my country and the EU was 4.05 trillion yuan, an increase of 4.7%, accounting for 13.9% of our total foreign trade value.
Among them, exports to the EU were 2.45 trillion yuan, an increase of 7%; imports from the EU were 1.6 trillion yuan, an increase of 1.3%.
China-EU mutually beneficial cooperation has a good foundation, great potential, and new opportunities. Institutional arrangements such as the China-EU Investment Agreement will further enhance the level of trade and investment facilitation between the two sides and release new potential.
China's cumulative direct investment in the EU exceeds US$80 billion
As of November 2020, the 27 EU countries have actually invested US$117.98 billion in China, and the cumulative number of investment projects has exceeded 38,000.
According to a survey by the European Chamber of Commerce in China, the epidemic has not shaken the confidence of European companies in investing in China. 89% of the European companies surveyed are willing to stay in China, and 2/3 of the European companies surveyed listed China as the top 3 investment destinations.
European companies such as Volkswagen, BASF, BMW and Allianz Insurance continue to increase investment in China.
China's investment in the European Union grew out of nothing, and its annual investment has jumped to nearly tens of billions of dollars.
As of November 2020, China's cumulative direct investment in the 27 EU countries exceeded US$80 billion.
Huawei, ByteDance, and Honeycomb Energy announced the establishment of new factories and data centers in Europe, showing the development trend of localized operation of Chinese-funded enterprises taking root in Europe.
China-Europe Express Trains Break Ten Thousands Since 2020
The “Belt and Road Initiative” jointly built by China and the EU has yielded fruitful results. The Port of Piraeus in Greece and the Hungary-Serbia Railway under construction have become important links for deepening China-EU connectivity.
The China-Europe Mutual Investment Fund, China-Central and Eastern Europe Investment Cooperation Fund, China-Europe International Exchange have expanded financial channels between Europe and Asia, and projects such as the Hinkley Point Nuclear Power Plant in the UK and the Pelješac Bridge in Croatia have led to new models of trilateral cooperation.
In the context of the epidemic, the "steel camel team" China-Europe Express has set a "new speed". Since 2020, the number of trains has exceeded 10,000. It has become a major channel for China-Europe interconnection and the lifeline of anti-epidemic material transportation.
What are the benefits for Chinese and European companies
The EU-China Investment Agreement focuses on institutional openness.
The promise of high-level market access will bring more investment opportunities for both companies.
High-level fair competition rules will provide a better business environment for bilateral investment.
In terms of market access, the agreement adopted a model of pre-access national treatment plus a negative list.
For the first time, China has made a commitment in the form of a negative list in all industries, including service and non-service industries, to achieve full integration with the foreign investment negative list management system established by the Foreign Investment Law.
The European side also promised me a higher level of market access in the agreement.
In addition, in response to market access restrictions that do not discriminate against foreign investment but have a significant impact on the establishment and operation of enterprises, the two parties will also promise not to affect the number of enterprises, output, turnover, directors and senior management, local R&D, export performance, and export performance in most economic fields. Restrictions are imposed on the establishment of the headquarters, and foreign exchange transfers related to investment and the entry and stay of personnel are allowed.
Regarding fair competition rules, the two sides are based on creating a business environment governed by law and reached consensus on issues closely related to corporate operations such as state-owned enterprises, subsidy transparency, technology transfer, standard setting, administrative law enforcement, and financial supervision.
The person in charge of the Department of Treaty and Law of the Ministry of Commerce said: After the negotiation is completed, the two parties need to carry out technical work such as legal review and translation of the text as soon as possible to promote the early signing of the agreement.
After the agreement is signed, it will take effect after both parties complete their respective internal approval procedures.
2021 is coming
China and Europe are two important economies in the world
Will further deepen economic and trade cooperation
Also bring new business opportunities to the world
Will surely promote the recovery of the world economy after the epidemic