Critics say it’s a rushed deal that’s too loose on workers’ rights. For Angela Merkel, it is a strategic victory and a cherry on the cake of the German Presidency of the Council of the EU.
EU diplomats and officials say the German Chancellor played a crucial role in finalizing the long-delayed EU-China investment deal, which took more than seven years of negotiations. Those talks are expected to end in a high-level video conference between Brussels, Berlin and Beijing on Wednesday, just before Germany hands over the rotating EU Council presidency to Portugal at the end of the week.
The video call with Merkel, European Commission President Ursula von der Leyen, European Council President Charles Michel and Chinese President Xi Jinping is scheduled for Wednesday at 1 p.m. Brussels time, the EU confirmed on Tuesday evening.
The leaders plan to give political approval to the agreement, which would then still have to be legally revised, translated into different languages and formally approved by EU governments and the European Parliament as well as potentially by national parliaments – a process that would take until at least early 2022.
The European Commission has declared the deal a success because it not only widens market access for European investors in China and tackles forced technology transfer, non-transparent subsidies and state-owned enterprises, but also commits also China to “make continuous and sustained efforts”. ratify international conventions on the prohibition of forced labor.
However, some EU countries like Belgium and the Netherlands have expressed concerns about the EU’s ability to deal with human rights issues under the agreement. Others, like Poland, wonder why the EU is rushing to seal the deal with China without waiting for the inauguration of US President-elect Joe Biden, whose transition team has already expressed concerns about the agreement.
Strong criticism also emanates from the European Parliament. “The Commission has fallen back on the issue of workers’ rights,” said Green MEP Reinhard Bütikofer, chairman of Parliament’s delegation for relations with China. Bütikofer said that mere pledges to quit forced labor were not enough: “It’s ridiculous to try to sell this as a success.”
The German lawmaker also criticized the deal as “a solo race as we know it from the Donald Trump administration”, and said: “Explain why three weeks ago the EU – which likes to qualify flagship of multilateralism – has said he wants to coordinate with the Biden administration vis-à-vis China, and now he’s trying to push through this deal just before Biden is invested as president. “
Theresa Fallon, director of the Center for Russia Europe Asia Studies, also lambasted the planned investment deal. “The main outcome from Beijing’s point of view was to drive a wedge in transatlantic relations, and Brussels seems to have complied,” she said.
EU officials reject criticism that a deal will rush without consulting the US, pointing out that Washington got its own trade and investment deal under President Trump and the EU is just trying to get it similar market access conditions, which would allow Brussels and Washington to coordinate their Chinese policies from a similar starting point.
A Commission official recalled that Brussels and Beijing had committed in April 2019 at the highest political level to finalize the investment agreement by the end of this year, and that the two sides were sticking to their own goal by now finalizing the negotiations, having repeatedly failed to make substantial progress in the negotiations of previous years – “to the chagrin of some of those now critical of this deal,” as the official said.
Still, there is little doubt in Brussels that the deal’s planned conclusion at year-end – at an unusual time for such important deals, between Christmas and New Years – carries Merkel’s handwriting all over the place. .
The investment agreement is part of a strategic move in China that Merkel has made the cornerstone of the six-month German presidency of the Council. “I think it is right and important to strive for a good strategic relationship with China,” Merkel said on September 14, when she initially planned a giant EU-China summit in Leipzig, which had to be canceled in due to the coronavirus pandemic and was replaced by a video conference with Chinese Xi instead.
Fair rules of the game
For European companies, especially German automakers and automakers, the deal is of great importance as it would allow them to increase their investment in the lucrative and steadily growing Chinese market without facing protectionist restrictions such as forced joint ventures, where local companies hold the majority of stakes. and can access trade secrets.
“We must not kid ourselves at this point; instead, we must measure things against realities,” Merkel said in September. “Today China is a clear competitor in many advanced technologies. So, of course, market access and the characteristics under which our trade takes place must be on a level playing field. fair, as they say, must prevail. “
Besides the strong leadership of Berlin, which was reinforced in Brussels by the German EU Ambassador Michael Clauss – who, by chance, is the former German Ambassador to Beijing – Merkel could also count on the “German motor From the European Commission. The EU diplomat said it: he appointed Björn Seibert, chief of staff to the President of the Commission; Sabine Weyand, Director General of Commerce; as well as Michael Hager, chief of staff to executive vice president Valdis Dombrovskis, under this “engine.”
Basically, Merkel appears to have gotten France’s backing for the deal. An official close to French Trade Minister Franck Riester, who last week criticized the human rights agreement, said Tuesday that “things are moving in the right direction”. An EU official said Merkel had reached an agreement with French President Emmanuel Macron under which she would succeed in concluding the deal under the German presidency, while the ratification and signing of the agreement would be finalized under the French Presidency of the Council during the first half of 2022.
Until then, addressing concerns about China’s human rights record, especially with regard to forced labor among the Uyghur Muslim minority, will be crucial. Beijing faced further international criticism after a Chinese court sentenced citizen journalist Zhang Zhan to four years in prison on Monday for her reporting on the coronavirus pandemic in Wuhan.
An EU official said the time left to ratify the deal by 2022 or later could be used to pressure China to honor its commitment to implement international conventions against forced labor – which the European Parliament will certainly push.
“We will be looking at this deal very closely,” said Kathleen Van Brempt, the socialist and democratic group’s trade coordinator. “Market access, stricter rules on subsidies and state-owned enterprises, and the fight against forced technology transfer are important, as are human and labor rights.
“The agreement should be a significant step towards improving working conditions, especially with regard to Uyghurs. It goes without saying that prior to ratification, a unilateral ban on the import of products of forced labor and child labor should be proposed, ”Van Brempt added.
Barbara Moens and David Herszenhorn contributed reporting.