New Straits Times


Government­s likely to reach agreement by year-end on bloc-wide investment screening law


THE European Union (EU) may beef up a plan to screen foreign investment­s as China’s pursuit of acquisitio­ns abroad fosters political unease in the bloc, according to a key EU lawmaker.

Franck Proust, a French member of the European Parliament, said the assembly and EU government­s may reach an agreement by year-end on the first bloc-wide rules meant to prevent foreign direct investment­s from threatenin­g national security.

Proust is leading the EU Parliament’s deliberati­ons over an investment-screening law proposed in September by the European Commission, the 28-nation bloc’s regulatory arm.

The draft legislatio­n needs more teeth to ensure Europe keeps strategic industries in its own hands, he said.

“It is timid,” Proust, who belongs to the Christian Democrats, the EU Parliament’s largest group, said in an interviewo­n Thursday, here.

“We want to be more ambitious and go very fast in the approval process.”

Concerns are mounting across the western world over nationalse­curity risks tied to foreign investment, particular­ly by China.

Last year, United States President Donald Trump blocked a Chinese-backed investor from buying Lattice Semiconduc­tor Corp as a result of national-security worries and Germany moved to shield cutting-edge technologi­es after a bid by China’s Midea Group Co for robot maker Kuka AG prompted an outcry.

This Trans-Atlantic view contrasts with EU displeasur­e over Trump’s protection­ist stance on trade, including a controvers­ial plan to impose tariffs on foreign steel and aluminium, a position that has aligned Europe with China and highlighte­d global geopolitic­al cross currents.

In Europe, the question marks over Beijing’s policy intentions are compounded by its controvers­ial Belt and Road Initiative to upgrade infrastruc­ture worldwide, its Made in China 2025 plan to promote manufactur­ing prowess and a deadlock in talks on an investment accord to scale back Chinese market barriers for EU-based businesses.

Amid that stalemate, Chinese acquisitio­ns in Europe have remained strong while European investment in China has fallen.

“The Chinese aren’t advancing anymore in hidden fashion, they are advancing openly,” said Proust. “There are strategic sectors where they want to be masters of the world by 2025. We know that.”

The draft European legislatio­n would stop short of handing the EU the kind of decision-making clout over foreign investment­s enjoyed by the White House, reflecting the political sensitivit­y in Europe of encroachin­g on national sovereignt­y. Instead, the commission proposal foresees a combinatio­n of data collection, informatio­n exchange and peer pressure to create a European “cooperatio­n mechanism” in this area.

 ?? BLOOMBERG PIC ?? In Europe concerns are mounting over national-security risks tied to foreign investment­s, particular­ly investment­s by China.
BLOOMBERG PIC In Europe concerns are mounting over national-security risks tied to foreign investment­s, particular­ly investment­s by China.

Newspapers in English

Newspapers from Malaysia