Connecting Regions of Asia.

China And The E.U. Are Close To A Landmark Deal

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Beijing and Brussels are on the brink of an agreement to roll back restrictions on investment — a deal that has been seven years in the making. An announcement is expected this week.
The pact has been a top priority of Chancellor Angela Merkel of Germany because it would give companies like Daimler and Volkswagen better control over their operations in China.
 But it faces opposition in Europe, and the incoming U.S. administration under Joe Biden has reservations. I spoke with Jack Ewing, who has been reporting on the deal from Germany, about what it means.
What is the gist of the deal, and what are its goals?
The problem with investing in China has always been that you had to share technology, you had to operate through joint ventures with Chinese partners. There were a lot of rules. 
The Chinese government could sometimes tell you where to put your factories. This treaty lifts those restrictions and gives European companies the same freedom Chinese companies get in Europe.
Why is the deal coming together now?
One of the big reasons is that Angela Merkel was the president of the E.U. the last six months. This was one of her signature projects. She wanted to get it done while Germany still held the rotating presidency, so there was an element of national prestige.
The bigger thing is that they’ve been working on this for seven years, and really only a week ago, China gave some ground on labor rights. 
The other thing is that Europeans learned under the Trump presidency that they needed to be more independent: They couldn’t rely on the United States the way they had in the past. I think they came to enjoy having more sovereignty and being a little more assertive overseas.
Critics in the E.U. argue that the deal takes away leverage needed to pressure China on human rights and other such issues.
The debate over the next couple days will be whether the agreement goes far enough to push China to end its labor abuses, its use of forced labor in some of the minority regions. 
The other element is that the U.S. and the E.U. together would have more leverage against China than either one of them alone.

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