EU texts

G7 Foreign Ministers' Statement on Preserving Peace and Stability Across the Taiwan Strait

Delivered by Commissioner for International Partnerships, Jutta Urpilainen on 14 September 2021

The EU's China policy has been defined in the following communications:

• European Commission joint communication titled "Elements for a new EU strategy on China" and dated 22 June 2016, and
• European Commission and HR/VP contribution to the European Council: "EU-China - A Strategic Outlook" published on 12 March 2019.
  

Reciprocity is an important theme: "The EU expects its relationship with China to be one of reciprocal benefit in both political and economic terms."

Coordination within the EU is also emphasised: "Dealing with China requires a comprehensive approach to ensure maximum impact."

In concluding, the strategy states that recommendations will follow to:

• improve the preparation and follow-up of EU-China Summits and other high-level meetings, as well as their coherence with Member States' high-level contacts with China;
• propose common policy frameworks in specific areas (e.g. connectivity);
• mainstream key themes and objectives across all EU-China dialogues, while concentrating on a smaller number of priorities where the EU has the greatest added value.

The 2019 Joint Communication proposes ten action points for the debate: these actions are formulated in the context of relations with China, but some of them relate to the EU's global competitiveness and security.

In general, the EU's response will pursue three objectives:

• Based on clearly defined interests and principles, the EU should deepen its engagement with China to promote common interests at global level.
• The EU should robustly seek more balanced and reciprocal conditions governing the economic relationship.
• Finally, in order to maintain its prosperity, values and social model over the long term, there are areas where the EU itself needs to adapt to changing economic realities and strengthen its own domestic policies and industrial base.

The European Union and China are two of the biggest traders in the world. China is now the EU's second-biggest trading partner behind the United States and the EU is China's biggest trading partner.

The EU is committed to open trading relations with China. However, the EU wants to ensure that China trades fairly, respects intellectual property rights and meets its obligations as a member of the World Trade Organization (WTO).

In 2013 the EU and China launched negotiations for an Investment Agreement. The aim is to provide investors on both sides with predictable, long-term access to the EU and Chinese markets and to protect investors and their investments.

At the 15th EU-China Summit in February 2012 agreement was reached to launch negotiations for an EU-China Comprehensive Agreement on Investment (CAI).

In May 2013 the European Commission published an impact assessment on the EU-China investment relations accompanying a recommendation for a Council Decision authorising the opening of negotiations of an EU-China CAI. In October 2013 the Council adopted the negotiating mandate for the Commission. In November 2013 the launch of negotiations was announced at the 16th EU-China Summit. The first round of talks took place in January 2014.

Following agreement on the CAI's comprehensive scope in January 2016 the parties moved on to specific text-based negotiations. At the 20th EU-China Summit on 16 July 2018, the parties exchanged market access offers for the first time. At the 21th EU-China Summit on 9 April 2019, the EU and China committed themselves to achieving in the course of 2019 the decisive progress required for the conclusion of an ambitious agreement in 2020. Major topics discussed have included disciplines on financial services, capital transfer, national treatment-related commitments, state-to-state dispute settlement, investment-related issues concerning sustainable development, competition-related issues, state-owned enterprises as well as issues regarding both parties' market access offers.

The EU's general objective is to use the exclusive competence for foreign direct investment it gained with the entry into force of the 2009 Lisbon Treaty to replace the bilateral investment treaties (BITs) all EU Member States except Ireland have concluded with China by a single EU-China CAI which takes into account the latest developments in EU investment policy as set out inter alia in the 2015 Trade for All communication.

The "Agreement on Trade and Economic Cooperation between the European Economic Community and the People's Republic of China" was signed on 21 May 1985 and entered into force on 1 October of the same year.

Even today, the Agreement remains the main legal framework for relations with China. The agreement covers economic and trade relations, as well as the EU-China co-operation programme. It was complemented in 1994 and 2002 by exchanges of letters establishing a broad EU-China political dialogue.

The Agreement sets out objectives and arrangements for action in the sphere of economic and trade cooperation and is non-preferential.

At the 16th EU-China Summit held on 21 November 2013 both sides announced the launch of negotiations of a comprehensive EU-China Investment Agreement.