A new EU China Strategy

Members of the Committee on International Trade (INTA) voted on Thursday by a large majority the opinion drafted by MEP Iuliu Winkler (UDMR, EPP) on the new EU-China strategy, which discusses the latest developments in the bilateral trade and investment relationship.

”The last months have brought significant changes in the EU-China relationship as the COVID-19 pandemic and the volatile dynamics of the international trade arena have reshaped priorities and showcased structural vulnerabilities. To meet such systemic challenges, the EC has to strengthen its unilateral trade toolbox, particularly the International Procurement Instrument, the Foreign Subsidies Instrument and the Due Diligence Regulation. China has to undertake concrete efforts towards the ratification and implementation of the outstanding ILO conventions on forced labour and full respect for human rights. The EU and China have a very broad and strategic trade and investment relationship, made up of different pillars. The Comprehensive Agreement on Investment is one such key pillar. However, as long as the Chinese sanctions against elected EU officials and its institutions are in place, CAI is off the table for INTA and for the European Parliament as a whole. Reciprocity and a level-playing field are an additional key pillar. China has to remove discriminatory barriers for EU exporters of goods and services, as well as for European investors. Progress is needed on State-Owned Enterprises, transparency on subsidies and rules tackling IPR infringement and forced technology transfers”, stated Iuliu Winkler at the end of the vote.

In line with its commitment to the rules-based multilateral trading regime, INTA has also highlighted China’s role in the reform of the WTO. Here we call for responsibility, a proper determination of China’s level of development as well as enforceable rules on structural concerns behind market distorting practices such as industrial subsidies, or the preferential treatment of SOEs.

The EU’s ability to shape the rules that govern the trade of tomorrow is pivotal, and hence standardisation is a fundamental priority where INTA wants a stronger and more influential EU. Linked to this is the area of the trade-security nexus and strategic dependencies, particularly relevant in critical infrastructure and critical raw materials. MEPs have thus called for more coordination between Member States, an enforced FDI Screening Mechanism and an effective EU Anti-Coercion Instrument. INTA also expressed its strong expectations on proper implementation and enforcement, primarily for the Geographical Indications agreement as well as the future implementation of CAI. The opinion stresses the important role of the Chief Trade Enforcement Officer and the need for frequent reporting to the European Parliament.

”The EU-China trade and investment relationship is a truly consequential one. We need to find a functional way for addressing systemic challenges, while not damaging economic interests and robustly defending EU strategic interests and values”, underlined Iuliu Winkler.

Today, INTA has voted the adoption of the opinion entitled “A new EU-China strategy”, updating the 2018 ‘EU-China State of Play’ report. This is a timely exercise, given the shifts in the bilateral relationship brought by the clear position of the 2019 Strategic Outlook on China, alongside changing global geopolitical dynamics