Silk Road Headlines_10th April, 2019
The ties between China and EU have been strengthened. According to the joint-statement of President Donald Tusk of the European Council both sides discussed the following topics: bilateral relations, economic global governance and foreign and security policy [EU-China Summit Joint statement, Brussels 9th of April 2019]. Below, you will find a generic overview of the topics discussed and some elaboration.
EU-China Comprehensive Investment Agreement in 2020
The EU and China commit to build their economic relationship on openness, nondiscrimination, and fair competition, ensuring a level playing field, transparency, and based on mutual benefits. Parties hope to conclude the EU-China Comprehensive Investment Agreement in 2020, which is considered ambitious. Both hope to improve market access, eliminate discriminatory requirements and practices affecting foreign investors, establishing balanced investment protection framework, and the including provisions on investment and sustainable development.
In relation to the bilateral relations, both parties expressed commitment to find mutually beneficial solutions for barriers, which shall be discussed in-depth during the next EU-China summit. Both sides are open to discuss a joint-competition policy and a possible MoU in the area of state aid control in order to foster fair competition by market actors and promote sounds economic growth.
Coincidentally, the IMF foresees a slowdown in the global economy in 2019, yet the outlook for 2020 remains unchanged for now. The forecast is a 0,2 percent point downgrade to 3,5 percent, largely due to political events, e.g. Brexit and US-China trade war. The IMF advised Beijing to unleash fiscal stimulus “to avoid a sharp near-term growth slowdown that could derail the overarching reform agenda.” Also, the IMF expressed concerns about U.S. tariffs on European aircrafts and foods. In relation to the EU, the IMF advised that Germany use fiscal stimulus measures and expressed that a loose monetary policy is warranted [Global economy cooling, coordinated stimulus may be needed: IMF].
Global challenges and governance
Both parties expressed their commitment to cooperate in order to implement WTO reforms, especially in relation to industrial subsidies. More about this is to follow on the G20 summit in Osaka. Also, the EU and China will look into how to align the Belt and Road Initiative with the EU Trans-European Transport Networks, to create synergies. Also both parties are looking to cooperate to tackle environmental issues.
Foreign and security policy
The EU and China intend to contribute jointly to international peace and stability via dialogue and cooperation in accordance with international law. From a geopolitical point of view, both sides stated to focus on the following countries: Iran, the Democratic People's Republic of Korea, Afghanistan, Venezuela, Ukraine and Myanmar. Also, they zoomed in on the issues surrounding the South China Sea; both hope that a Code of Conduct is going to be concluded for that area by ASEAN-countries and China. Also, both expressed their intention to support African solutions to African problems to maintain peace and security in Africa.
President Junker stated that the negotiations where difficult, yet fruitful. Cooperation between regional powers is warranted, as is also depicted in the outlook by the IMF of the global economy. Also, global issues, such as environmental challenges (having clear drinking water, food and air) are acquiring a cross-border character. Hopefully, other regional powers will join in this collective effort to tackle upcoming global issues as partners, since the (economic and financial) ramifications of events such as the aftermath of 2007 are felt by everybody on an individual basis.