China, EU can grow role: re­port

‘Sig­nif­i­cant op­por­tu­ni­ties’ lie ahead to build wider eco­nomic re­la­tion­ship

China Daily (USA) - - FRONT PAGE - By MIKE HAR­RI­SON

Fu­ture co­op­er­a­tion be­tween China and the Euro­pean Union should be seen as a step­ping stone to a wider global gov­er­nance part­ner­ship and re­form, ac­cord­ing to a new re­port. The doc­u­ment – EUChina Eco­nomic Re­la­tions to 2025: Build­ing a Com­mon Fu­ture – iden­tifi es key trends and ar­eas of po­ten­tial eco­nomic col­lab­o­ra­tion. It cites the “sig­nif­i­cant op­por­tu­ni­ties” for China and the EU to deepen their eco­nomic ties, with scope for an “enor­mous in­crease” in in­vest­ment. But it also warns of po­ten­tial ob­sta­cles, in­clud­ing “sig­nifi cant diff er­ences” be­tween the po­lit­i­cal and eco­nomic sys­tems of China and the EU. “Build­ing a gen­uine strate­gic part­ner­ship will re­quire greater eff ort from both EU and Chi­nese lead­ers,” the re­port says. The doc­u­ment, which was pub­lished on Wed­nes­day, is the cul­mi­na­tion of an 18-month study by the China Center for In­ter­na­tional Eco­nomic

Build­ing a gen­uine strate­gic part­ner­ship will re­quire greater ef­fort ... ” EU-China Eco­nomic Re­la­tions to 2025: Build­ing a Com­mon Fu­ture re­port

Ex­changes, Brus­sels-based eco­nomic think tank Bruegel, Chatham House, and the In­sti­tute of Global Eco­nom­ics and Fi­nance at the Chi­nese Univer­sity of Hong Kong.

It says the EU and China should con­clude an “in­vest­ment agree­ment” that would pave the way for a fu­ture free-trade pact and re­lax visa re­quire­ments for each other’s busi­ness­peo­ple and stu­dents.

It also calls for joint re­search and in­no­va­tion projects and for greater co­op­er­a­tion on en­ergy se­cu­rity and climate change.

“Against a back­ground in which the United States is in­creas­ingly draw­ing into ques­tion its com­mit­ments to free trade and the global com­mons – and with the un­cer­tainty re­sult­ing from Brexit – there clearly ex­ists a need for China and the EU not only to in­crease the breadth and depth of their co­op­er­a­tion, but also to act more strate­gi­cally in the way they re­lateto each other,” the re­port says.

The Belt and Road Ini­tia­tive is seen by the re­port’s au­thors as a plat­form for fur­ther ex­pand­ing bi­lat­eral trade and eco­nomic co­op­er­a­tion, with the EU po­ten­tially be­com­ing its “western an­chor”. They say the “strate­gic goal” of China and the EU should be to move closer “in re­sponse to US un­cer­tainty”.

“This is a crit­i­cally im­por­tant mo­ment for the EU and China to con­sider how to deepen the full range of their bi­lat­eral eco­nomic re­la­tion­ship,” it says.

Trade is the most de­vel­oped area of in­ter­ac­tions be­tween China and the EU, with each be­ing the other’s largest source of im­ports and sec­ond-largest ex­port des­ti­na­tion.

While trade re­la­tions are well de­vel­oped, the re­port says there is room for im­prove­ment in for­eign in­vest­ment lev­els, co­op­er­a­tion on in­dus­trial and tech­no­log­i­cal in­no­va­tion, and fi­nan­cial mar­ket in­te­gra­tion.

It adds that only a “sen­si­ble” Brexit deal will en­hance ben­e­fits of closer China-EU re­la­tions and the economies of China, the UK, and the EU “have a mu­tual self-in­ter­est in see­ing a con­struc­tive out­come from the Brexit ne­go­ti­a­tions”.

Trade be­tween China and the EU reached 515 bil­lion eu­ros ($614 bil­lion) in 2016, com­pared with 113 bil­lion eu­ros in 2001.

The EU and China are each other’s largest source of im­ports and their sec­ond­largest ex­port des­ti­na­tions. Last year, China ac­counted for 20.2 per­cent of all EU im­ports, while Europe pro­vided 13.1 per­cent of Chi­nese im­ports. China was the des­ti­na­tion for 9.7 per­cent of EU ex­ports, with the EU tak­ing 16.1 per­cent of Chi­nese ex­ports.

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