Question to the EC: EU-China investment deal

See Francisco Guerreiro’s question to the European Commission and the written answer on the EU-China investment deal.

Subject: EU-China investment deal

Last year, the EU and China agreed to conclude this investment deal in 2020. However, we should be prudent, and consider the following: it is deeply worrying that China is suppressing information on COVID-19, nationally and abroad. The New York Times (1) has reported that the EEAS allegedly rewrote a document about disinformation in ways that diluted the focus on China. Within China, journalists are not allowed to do their work properly, minorities are imprisoned and state propaganda is omnipresent. 

Given this information, and the fact that the EU is highly dependent on China for its current supply of medical equipment and medicine, as well as for other goods and services, I ask:

1. Is the Commission still expecting to finalise a deal with China in 2020? 

2. Are transparency and freedom of information considered ‘red lines’ by the EU negotiating team? 

3. In the negotiations is the Commission considering the ‘pressing need to produce critical goods in Europe, to invest in strategic value chains and to reduce over-dependency on third countries [China] in these areas [medical manufacturing]’ (2)? 

(1)       https://www.nytimes.com/2020/04/24/world/europe/disinformation-china-eu-coronavirus.html

(2)       https://www.ft.com/content/95dcaac2-162e-4ff4-aca5-bb852f03b1e9

Answer in writing

The Comprehensive Agreement on Investment (CAI) between the EU and China is an important tool to rebalance market openness and level the playing field for EU companies operating in China. The EU and China agreed in the 22nd EU-China Summit to accelerate negotiations. The EU remains committed to concluding negotiations in 2020 if possible but only if the agreement is worth having. China should increase its level of ambition, including on level playing field issues, market access, and sustainable development. 

The CAI negotiations are focused on investment. Political issues should be raised through the appropriate channels of communication. The EU’s commitment to respect the freedom of the media, the right to information and the freedom to hold opinions are enshrined in Article 11 of the Charter of Fundamental Rights. The EU is fully committed to freedom of expression, online and offline, around the world, and will continue to discuss human rights as part of its bilateral dialogue with China. 

The CAI will not affect the EU’s openness to foreign investment. This openness is balanced by appropriate control of foreign investment. This is even more important in critical situations such as during the COVID-19 emergency. The Commission provided guidance to Member States on foreign direct investment (FDI) screening in a public health crisis and economic vulnerability to protect EU companies and critical assets, including medical equipment, essential for our security and public order.(1) Under the InvestEU programme proposed by the Commission support can be provided to companies to maintain and develop their production within the EU. Overdependence on third country markets could be addressed by diversifying supply chains.

(1)       Communication from the Commission (Guidance note to Member States) on foreign direct investment, free movement of capital and the protection of Europe’s strategic assets. Brussels, 25.3.2020 C(2020) 1981 final.

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