Eu China Investment Agreement Suspended

Thursday`s decision came after European Commission executive vice president Valdis Dombrovskis said earlier this month that political awareness to promote the controversial trade deal had been «stopped» following recent sanctions. The main situation in Hong Kong has been the introduction of a law allowing the extradition of criminals from Hong Kong to mainland China for trial. This has been portrayed in the West as a violation of Hong Kong`s «freedoms» and a violation of the «one country, two systems» mechanism. It then became a broader call for democratic rights in Hong Kong – something it had never had before. Riots followed, during which the Hong Kong government passed a series of new laws to prevent unrest and illegal gatherings, and introduced new mechanisms to strengthen mainland China`s dominance over the territory. This was again portrayed as a violation of the «one country, two systems» agreement that China had reached with the UK when It handed over Hong Kong in 1997. The reality is that Hong Kong has never had a democracy, even under British rule, while the 1997 agreement on one country and two systems has become inadequate after nearly a quarter of a century. China`s attempts to change it have been portrayed as a «break in democracy» that Hong Kong has never had. In late December, the European Union and China approved a controversial investment deal after seven years of marathon negotiations. German Chancellor Angela Merkel gave new impetus to the talks; The Chinese market is particularly important for German car manufacturers and manufacturers that have a strong presence in the country. Whether the AIC is adopted or not, skeptics argue that the deal is not as effective as its proponents suspect. Analysts said Beijing`s economic planners hope to use the deal as an opportunity to push for domestic reforms, although the IMPACT of the CAI on the Chinese economy remains uncertain. Following these sanctions, the European Parliament adopted on 20th May the resolution freezing the ratification of the agreement.

In addition, the resolution called for greater unity among EU member states to address other China-related issues, such as threats. B of cybersecurity. In the past, the European Parliament has always been a more critical voice towards China. He is now able to wield more power to vote against trade and investment deals on the grounds of political conditionality,» said Yu Jie, senior china researcher at the London-based Chatham House think tank. The accelerated conclusion of the investment agreement, in particular the guarantees on workers` rights, was met with criticism, scepticism and even disbelief from most Members of the European Parliament. MEPs criticise The recent Chinese sanctions against EU lawmakers and will not consider discussions on ratifying the EU-China Agreement (IAC) as long as they exist. Even without the CAI, China surpassed the US last year and became the EU`s largest trading partner, with both sides recording $709 billion in trade in 2020. While the CAI can boost trade and investment, it is not a prerequisite for this. In addition, many EU Member States have already concluded bilateral agreements with China covering similar areas. Of the 27 EU Member States, Ireland is the only one without a bilateral investment agreement with China. «We have now, in a way, suspended the political awareness of the European Commission,» Commission Executive Vice-President Valdis Dombrovskis said on Tuesday.

He said the current state of relations between Brussels and Beijing was «not conducive» to ratifying the agreement, known as the EU-China Comprehensive Investment Agreement. But the deal has angered Chinese skeptics and human rights activists in Europe. The Commission estimates that EU foreign direct investment in China has reached more than €140 billion over the past 20 years, while China`s investment in the EU amounts to almost €120 billion. While Dombrovsky`s comments do not suggest that the pact has been officially suspended, they do suggest that recent tensions between Brussels and Beijing have dampened the EU`s appetite for such a deal with China. Retaliatory sanctions over Beijing`s treatment of Uighurs end investment deal «For now, we have […] some of the Commission`s efforts for political awareness are exposed, as it is clear that in the current situation, with EU sanctions against China and Chinese counter-sanctions, including against Members of the European Parliament, the environment is not conducive to the ratification of the agreement,» said Valdis Dombrovskis, Executive Vice-President of the European Commission, to the French news agency AFP in an interview. .