The leaders of the EU and the European States were busy last week: cheering for the World Cup in Russia, debating with Trump in Brussels, and making a joint statement with China in Beijing.

Since 1998, the EU-China Summit has been the highest-level annual meeting between the EU and China. On 16 July 2018, the EU and China held the 20th summit in Beijing. This occasion also marked the 15th anniversary of the EU-China Comprehensive Strategic Partnership. The President of the European Commission Jean-Claude Juncker and the President of the European Council Donald Tusk represented the European Union, and Premier Minister Li Keqiang represented China at the summit.

During the summit, the EU and China achieved good results. Both sides agreed on a joint statement, together with a number of concrete deliverables in relation to climate change and clean energy, comprehensive agreements on investment, oceans, circular economy cooperation, emissions trading, geographical indications, intellectual property rights and the China-EU co-investment fund, as well as anti-fraud related arrangements. The joint statement proclaimed that,

“The Leaders reaffirmed their commitment to deepening their partnership for peace, growth, reform and civilization, based on the principles of mutual respect, trusty, equality and mutual benefit, by comprehensively implementing the EU-China 2020 strategic Agenda for Cooperation.”

Both sides significantly enhanced the bilateral relation level, with a particular focus on bilateral investment. Article 13 of the joint statement determines that the ongoing Investment Agreement Negotiations (IAN) is a “top priority” and a “key project”. The IAN helps to establish and maintain an open, predictable, fair and transparent business environment for respective investors. In particular, the statement indicates that both sides are committed to accelerating the discussions of both the joint text and market access offers, with a specific focus on the exchange of market access offers, which should bring the IAN into a new phase.

Both the EU and China share the same attitudes towards bilateral investment, which is to encourage, promote and protect foreign investment. With regard to the statement, the EU responded to China’s One Belt One Road initiative, while China also responded to EU initiatives including the EU Investment Plan and extended Trans-European Transport Networks. Moreover, the EU and China also “welcome the signing of the documents relating to the establishment of the China-EU co-investment Fund, and the launch of the first co-investment under the Fund.” Accordingly, both sides have developed a mutually encouraging and supportive attitude towards bilateral investment. However, there is still discussion as to what should be encouraged, to what extend and how investments should be protected.

According to the EU-China 2020 Strategic Agenda for Cooperation, the EU-China Investment Agreement is the core of their long-term bilateral relation. Since the first negotiations launched in 2013, 17 rounds of negotiations have taken place in the period until May 2018. The 17th round of negotiations in Beijing led to concrete progress on expropriation and partial aspects of the dispute settlement mechanism. Some provisions, including national treatment, fair and equitable treatment and sustainable development, still require further discussion. This indicates that the IAN is a serious and long-term mission for both sides. One day later, on 17 July, the EU signed the Strategic Partnership Agreement and the Economic Partnership Agreement (EPA) with Japan at the 25th EU-Japan Summit in Tokyo. Both sides further agree to reach convergence in the investment protection negotiations as soon as possible. The EU-Japan EPA negotiation also started from 2013. Comparatively, the negotiation process between EU and China is rather slow.

Generally, this EU-China statement is remarkable in terms of the general relationship between the EU and China, especially concerning bilateral investment between both sides. As a top priority determined by both sides, foreign investment plays a critical role. One can predict that both sides will be more engaged in the IAN in order to achieve the goals laid down in the 2020 strategy. As both sides still have to negotiate several essential aspects of the agreement, it is not realistic to expect an announcement of the EU-China investment agreement as soon as some people may have predicted.

I hope to read the full text of the agreement in 2019.