EU-China Comprehensive Agreement on Investment - Great Opportunity for Mutual Sustainable Development

Dimitrijević, Duško (2021) EU-China Comprehensive Agreement on Investment - Great Opportunity for Mutual Sustainable Development. Working Papers (3). pp. 1-20. ISSN 2560-1628

Text 6. EU-China Comprehensive Agreement on Investment.pdf - Published Version Available under License Creative Commons Attribution Non-commercial No Derivatives. Download (669kB)

Abstract

Following the entry into force of the Lisbon Treaty in 2009, the issue FDI has shifted from state competence to exclusive EU competence as part of its common trade policy. In line with the new situation, the EU has launched negotiations to reach fairer solutions on free trade with China. Considering China not only its most important trading partner, but also a systemic rival whose investments in critical assets, technologies and infrastructure carry certain security risks, the EU agreed with China at the end of 2020 to conclude an EU-China Comprehensive Agreement on Investment (CAI). The CAI should complete existing bilateral trade agreements, thus bringing greater legal certainty and thus a healthier economic environment within the EU, as well as freer and more equal access of European investors to the Chinese market, while providing adequate legal guarantees on national treatment and abolition of quantitative and capital constraints. Consequently, equalizing business conditions and establishing new rules for investments of state-owned Chinese companies in the EU, while respecting international labor, technological and environmental standards, could lead to the improvement of mutual trade relations. Starting from the above assumption, the author of the study believes that it is possible to find appropriate solutions that would reduce the risks caused by political disputes that led to the suspension of the CAI ratification process, to the detriment of legitimate interests to achieve mutually sustainable economic development. In this regard, the study presents the legal, political and economic arguments that support this opinion.

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