Towards an economic agreement between China and Europe?

After seven years of negotiations, an economic agreement in principle was concluded yesterday between Chinese President Xi Jinping and the European Union, via the President of the Commission, Ursula von der Leyen, and her counterpart in the European Council, Charles Michel.

The text does not cover trade in goods, such as those already negotiated by Brussels with Canada, Japan or the United Kingdom. An agreement that would abolish all or part of customs duties on the 600 billion euros of goods traded each year between China – still accused of dumping – and the European Union, is not for tomorrow.

The current agreement with Beijing relates only to the possibilities of EU and Chinese companies to establish themselves in their reciprocal territories. They already do this to the tune of 5 to 7 billion euros on both sides each year.

What social rewards?

If the Chinese market weighs 1.39 billion inhabitants and a gross domestic product of 15,200 billion (seven times that of France), the Europeans want a rebalancing: today, a Chinese company can buy a company in Europe without restriction (unless it is a strategic activity). But in China, a European company will have to remain there under the domination of a Chinese shareholder… and the threat of technological plunder.

Xi Jinping wants to develop his relations with Europe. With its other major client, the United States, the strategic, technological and economic rivalry is too committed to end with the departure of Donald Trump. However, while the Chinese Communist Party will celebrate its centenary next year, the dictatorship of Beijing, which also holds by the economic growth of the country, has not yet succeeded in eradicating poverty as Xi Jinping had promised. European investments are therefore welcome.

But in the European Parliament, whose agreement will be essential, some demand counterparts: that Beijing ratify several international conventions improving labor law, frees political prisoners, stop oppressing the Uyghurs. These 12 million Muslims in Xinjiang, who produce almost 20% of the world’s cotton, are also of increasing interest to NGOs and consumers.

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