EU puts new Investment Agreement with China on hold

The European Commission will stop efforts to approve the Comprehensive Agreement on Investment (CAI) between China and the European Union (EU). European Commissioner for Trade, Valdis Dombrovskis, said that approval for the CAI is complicated due to recent EU-China relations. 

The European Parliament (EP), which has to approve the 2020 agreement, said that approval is “impossible” for the time being because of the tense relationship. In recent months, the Parliament has already been critical of the CAI, given the recent Chinese sanctions against five Members of the European Parliament. As long as China does not withdraw the sanctions, the EP will not ratify the agreement.

“We have in a way suspended the political rapprochement activities on the part of the European Commission”, Dombrovskis told Agence France-Presse.

A spokesman for Dombrovskis said that lawyers still had to study the CAI and the text still had to be translated before the EP could consider it. Nevertheless, “the prospects for ratifying the agreement will depend on how the situation develops. In this context, the Chinese retaliatory sanctions against MEPs are unacceptable and regrettable.”

After seven years of negotiations, the European Commission, together with the German presidency of the EU at the time, concluded the investment agreement with Beijing late last year with a view to further open the Chinese market to European companies. The European Parliament and some member states, however, were quick to criticise the deal, claiming it contained insufficient guarantees for European companies.


Source: commonspace.eu with agencies

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