EU – China Summit 2017: Conclusions


Brussels and Bejing Say; Trump Climate Move a Mistake!

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Remarks by President Donald Tusk after the EU-China summit in Brussels
Brussels, 2 June 2017

Yesterday evening we had a good informal meeting with Premier Li and this morning we have just concluded our plenary session of this year’s EU-China summit. We had fruitful and constructive talks that underline the importance we both attach to EU-China relations.

China and the European Union are strategic partners. We have a stake in each other’s success. Our cooperation is broad and continues to broaden and strengthen on issues like trade and investment, climate change, the migration crisis, North Korea, and a security partnership in Africa. We share many interests. Most importantly, we share a fundamental interest in upholding and strengthening the rules-based international system. For example, respect for the territorial integrity and sovereignty of Ukraine has been our common position since 2015. And in these difficult times we have a joint responsibility to protect this system and demonstrate its added value in all aspects of our relations.

Today, we are stepping up our cooperation on climate change with China. Which means that today, China and Europe have demonstrated solidarity with future generations and responsibility for the whole planet. We are convinced that yesterday’s decision by the United States to leave the Paris Agreement is a big mistake, bigger than not ratifying the Kyoto Protocol, because Paris is fairer. But the fight against climate change, and all the research, innovation and technological progress it will bring, will continue, with or without the US.

However, strong transatlantic ties are far more important and far more durable than the latest, unfortunate decisions of the new Administration. Strong transatlantic ties are still the best guarantee that the people and nations who advocate freedom and peaceful order will not be left helpless or alone.

We also discussed the issue of human rights today. How we can further improve cooperation on this at the bilateral and international level. I expressed our concern about freedom of expression and association in China, including the detention of human rights lawyers and defenders, as well as the situation of minorities such as Tibetans and Uighurs. I am glad we could agree that the next round of our human rights dialogue will take place later this month. Finally, on North Korea, we welcome China’s efforts. We share a common interest in peace and stability on the Korean Peninsula, de-escalation of tensions, and for North Korea to comply with its international obligations and abandon all nuclear and ballistic missile programmes. We count on China’s continued support to achieve these objectives.

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Speech by President Jean-Claude Juncker at the 12th EU-China Business Summit
Brussels, 2 June 2017

I never made a secret of my affection and my admiration for your great nation and for the Chinese people. Over the many years and visits – first as the Prime Minister of Luxembourg, now as the current President of the European Commission – my fascination with your rich history and culture has only grown stronger.

Like all good friends, we may sometimes have our disagreements – and we have disagreements – but I believe that the frankness and honesty between us makes our relation stronger.

Our partnership today is more important than ever before.

The European Union is China’s biggest trading partner. China is the EU’s second largest. The trade in goods between us is worth over EUR 1.5 billion every single day.

Access to the European internal market is amongst the main elements having contributed to China’s economic miracle, helping millions of people out of poverty.

Over 10 million Chinese people now visit Europe every year. And next year’s EU-China Tourism Year will provide new opportunities for investment and more people from both sides to discover the beauty of each other’s landscapes and ways of life. And I will make use of this Tourism Year to spend half of the year in China…

But our relationship is not an insular one. It is one that looks out to the world and makes it more stable. Whether it be fighting climate change – more important today than yesterday – cyber-attacks and international terrorism, or whether it be promoting sustainable development, trade and global economic growth, China and the European Union are aligned on the need for international solutions.

Nowhere is that more important than in leading the global clean energy transition and the implementation – the full implementation without nuances – of the Paris Climate Agreement.

Our joint leadership provides businesses, investors and researchers – in Europe, China and around the world – with the certainty they need to build a global low-carbon economy.

And it makes a statement to the world: there is no reverse gear to the energy transition. There is no backsliding on the Paris Agreement.

Our relationship is founded on a shared commitment to openness and working together as part of a rules-based international system. I am glad that we can meet here today and say this, loud and clear. It is one that recognises that together we can promote prosperity and sustainability at home and abroad. This is the vision that President Xi so eloquently described in Davos earlier this year.

I know that the Prime Minister is also fully signed up to that. The State Council Notice on Promoting Further Openness showed his commitment. And the Government Work Plan that explicitly stated China’s ambition to be the most attractive destination for foreign investment backed that up.

Over the years we have come a long way. Back when I first visited China as a Prime Minister in 1996, your country was not even a member of the WTO. On that trip I remember talking a lot about working together, but in reality we were closed off to each other. China accounted for only 5% of world exports. Tourism – Chinese to Europe and European to China – was really unusual at that period of time. Our businesses exchanged less and our economies were not as interlinked as they are today.

Today, the EU is China’s most important destination for outward investment. Chinese companies are attracted by the talent and innovation of our people, the stability of our investment environment and the strength of our economy.

And we are just as attracted to China’s economy. In 2014, the European Union accounted for nearly 16% of total Foreign Direct Investment into China.

But there is scope for much more. China accounts for less than 5% of foreign investment in the EU. And last year, China’s investors spent nearly five times as much on acquisitions in the European Union than European companies did in China.

While Chinese investment into the European Union increased by 77% in 2016, the flow in the other direction declined by almost a quarter. To put that into context, EU investment into China last year was roughly 3% of what we invested into the United States.

That reflects how difficult it can still be to do business in China. Roughly half of EU companies say that it actually got harder last year. One in two say they feel less welcome than when they entered the Chinese market. And more than half say that foreign companies are treated unfairly compared to their Chinese competitors. That feedback is reflected in the World Bank’s rankings of the ease of doing business. China sits in 78th place out of 183 countries. A big economic powerhouse needs to be higher than mid-table.

The Government’s Work Plan shows China wants to move up the table. It calls for significant improvements in the investment environment and says foreign firms will be treated equally.

The Comprehensive Agreement on Investment currently being negotiated will be a game changer. It will allow us to invest with confidence. It will help protect investments, ensure market access and level the playing field.

This is the third summit I have had the pleasure of taking part in and the third time I have stressed the need for this Agreement to be put into place. We now need to get it done so that we can truly have reciprocal investment relationship in our mutual interest.

We applaud the ambition of China’s reform path. We recognise that reforms have been made and that plans have been established. But we would like to see implementation speed up – so that your policies are in line with your world vision.

The Prime Minister knows me well enough to know that I will always be frank and honest with him on all these matters.

And I will take the same approach when it comes to the rule of law and fundamental human rights. These are universal questions of fairness and values that we hold dear but they are also pre-requisites for a stable and attractive investment and business environment. And we believe that real competition and real openness can only work with a level playing field.

That is more important than ever as globalisation is increasingly called into question, with many around the world asking whether it really works for them.

The Commission set out its views in a Reflection Paper on Harnessing Globalisation. I explained this vision at last week’s G7 and will do so again alongside China at next month’s G20.

I understand that 45% of Europeans consider globalisation to be a threat rather than an opportunity. Here in the European Union we are focusing minds and efforts on making sure that no one is left behind and that we are all playing by the same rules.

That is why we must address growing excess capacity in certain sectors that is leading to the dumping of below-cost products. This is hurting EU producers, costing jobs and having a damaging impact on some of our manufacturing and industrial heartlands.

Chinese steel overcapacity is now more than double the EU’s total capacity. Over the past decade, Chinese overcapacities have tripled for steel pipes and quadrupled for aluminium and silicon.

When we have to, we will be sure to uphold fairness when it comes to trade. And we are backing that up by strengthening our trade defence instruments to make them fit-for-purpose.

This is not about being protectionist or pointing fingers at others. Our actions are fully in line with our international obligations under the WTO and we will apply them in a fair, transparent and country-neutral way. Trade cannot simply be free. It must be fair.

But as always, the European Union believes in dialogue and cooperation and we will continue to work closely with our Chinese friends on addressing excess capacity and other concerns, notably on data and technology.

This dialogue is crucial at a time when the European Union and China now have a responsibility to fight for a fair and open global market place. Delivering on this dialogue is our deep, strategic interest. If we fail to make progress, the only winners will be the political forces that oppose the openness we seek.

And together, we can make the most of the opportunities that can bring. For example, China is now building corridors that are connecting us by land and sea, as well as online. We welcome the opportunities created by the “Belt and Road” initiative – it will bring people and businesses in Asia and Europe closer together. The new direct rail links between Beijing and European hubs are symbols of that. They will resurrect an old trade route and cover 12,000 kilometres, crossing Kazakhstan, Russia, Belarus, Poland, Germany, Belgium, and France.

And we want to make sure that the “Belt and Road” complements existing projects, including those under the EU’s long-established Trans-European Networks policy or the EU-China Connectivity Platform. Over time, improved connectivity will help manufacturers and businesses of all sizes to lower transport costs and open new markets.

But much more is needed: Asia alone faces a EUR 23 trillion infrastructure gap by 2030. Both the EU and China have a key interest in making the “Belt and Road” Initiative. Our message is that we can help you build it – but the rules must be the same for all. European companies must have a fair chance of being able to tender and compete on the same terms as Chinese counterparts. We must ensure, there too, a level playing field.

I am very much encouraged by China’s statements on making the “Belt and Road” an open, transparent, inclusive initiative. Let us work on these projects together. Let our companies build them together.

That is just a glimpse of the potential that our partnership holds, not just for the European Union and for China – but also for the rest of the world.

Europe’s future lies in our own hands – this is what leaders stated in their recent Rome Declaration. So we should shape our own future – and China will be a crucial partner in that. Together, we can increase the prosperity and well-being of our people. Our companies can thrive in open, fast-growing international markets. We can learn from each other and push each other on to innovate and compete. We can stand up for fairness across the world.

With China, the EU will fight for its global vision, in which we work together to tackle the challenges we share. We will defend the level playing field and make sure that the international system is anchored in rules and institutions that we all agree on. We will accompany the green transition together, in the interests of our children and our grandchildren.

And by doing so we can help to make the world a more stable place, at a time when it is full of uncertainty.

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Commission and China start dialogue on state aid control
Brussels, 2 June 2017

European Commissioner Margrethe Vestager, in charge of competition policy, and He Lifeng, Chairman of China’s National Development and Reform Commission, have signed today in Brussels a Memorandum of Understanding to start a dialogue on state aid control.

Commissioner Vestager, responsible for competition policy, commented: “Decisions by one country to grant a subsidy to a company that operates globally may affect competition elsewhere. The European Commission is pleased to start a discussion with China on how to best handle state intervention in the economy.”

The State aid dialogue creates a mechanism of consultation, cooperation and transparency between China and the EU in the field of state aid control.

The dialogue will be used to share with China the European experience in enforcing state aid control. It will also be used to learn more about the implementation of the newly adopted Fair Competition Review in China, which is designed to prevent public policies from distorting and restricting competition while maintaining fair market competition and promoting a unified market.

This new State aid cooperation dialogue will further the EU’s and China’s mutual interest and joint work to promote fair global competition. It is part of the Commission’s broader strategy to address the distortion that national subsidies policies put on the promotion of a global level playing field where companies can compete on their merits.

The European Union has a strong interest in promoting fair and competitive markets globally and to this end, it welcomes the adoption of the Fair Competition Review System and looks forward to working with China in this context.

China is the world’s third largest economy and the EU’s second trading partner. The EU is China’s biggest trading partner.

The dialogue will be supported by cooperation with working groups at technical level and is due to take place at least once a year, alternating between Brussels and Beijing.

Background

The European Commission has been cooperating closely with competition authorities of countries outside the EU for many years.

At bilateral level, the Commission has engaged in a wide range of cooperation activities with competition authorities in a number of third countries on the basis of agreements or memoranda of understanding. Moreover, in its Free Trade Agreements negotiations, the Commission is also negotiating a Competition Chapter which provides rules and disciplines on both antitrust, mergers and subsidies.

In addition, the Commission participates actively in the competition-related activities of a number of multilateral organisationssuch as the International Competition Network , [ICN]the Organisation for Economic Cooperation and Development , [OECD] UNCTAD, the World Trade Organisation. [WTO]

The main objective of this cooperation at both levels is to promote convergence of competition policy instruments and practices across jurisdictions, with the exchange of views on broader policy and enforcement issues and the facilitation of cooperation with competition authorities in other jurisdictions in enforcement activities. [More]

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100 European geographical indications set to be protected in China
Brussels, 2 June 2017

The EU and China agreed today to formally publish a list of two hundred Europeanand Chinesegeographical indications -100 from each side- that will be considered for protection through a bilateral agreementto be concluded in 2017.

This publication opens the process for protecting the listed products against imitations and usurpations and is expected to result in reciprocal trade benefits and increased consumers’ awareness and demand for high-quality products on both sides.

The EU list of products to be protected in China includes products like Bayerisches Bier, Feta, Queso Manchego, Champagne, Gorgonzola and Polska Wódka while among the Chinese products aspiring to obtain geographical indications status in the EU we can find for example Yantai Ping Guo (Yantai apple), Hengxian Mo Li Hua Cha (Hengxian jasmine tea), Panjin Da Mi (Panjin rice) and Baise Mang Guo (Baise Mango). The publication of these lists is part of the standard procedure and opens a period for interested parties to present their comments.

The Chinese market for agri-food products is one of the world’s largest, and is getting larger every year, fuelled by a growing middle class population that has a taste for European food and drink products, often as a result of their international travels. The country also has a rich tradition of geographical indications of its own, many of which are still largely unknown to European consumers but which should now become more widely available thanks to the agreement.

European Commissioner for agriculture, Phil Hogan, said today: “Our EU geographical indication products are a real success story, with growing global sales worldwide. Consumers all around the world trust in our Geographical Indication classification system – this means that they trust the origin and quality of the products, and are willing to pay a higher price for the products, thus a higher premium for the farmer. Working closely with our global trading partners such as China is a win: it benefits our farmer and agri-businesses; it develops stronger trading relationships between like-minded operators; and of course, it benefits consumers on both sides of the agreement.”

EU-China cooperation on geographical indications began over 10 years ago and led to the protection of 10 GIs names on both sides under EU and Chinese legislation. Building on this initial cooperation, in 2010 the EU and China started to negotiate a bilateral agreement on cooperation on, and protection of, geographical indications. The first step of this process is the publication of the two lists of 100 products from each side that the other will protect in their territory once the agreement enters into force.

Interested parties now have two months to comment on the products selected by both parties and, if necessary, raise any concerns with either the EU or Chinese authorities.

Geographical indications are one of the great successes of European agriculture, with over 3300 EU names registered. A further 1250 or so non-EU names are also protected within the EU, mostly thanks to bilateral agreements such as this one with China. In value terms, the market for EU geographical indications is around €54.3 billion, and together they account for 15% of total EU food and drinks exports.

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For more information:

§ [Joint statement of the Commission and the government of the People’s Republic of China]

§ [List of European geographical indications published]

§ [List of Chinese geographical indications published]

§ [EU agricultural product quality policy]

§ [EU-China Geographical Indications – “10 plus 10” project]

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Related:

§ Frequently Asked Questions on EU-China relations: Other available languages: [EN FR DE DA ES NL PT FI EL CS ET HU LT LV MT PL BG HR]

§ EU-China Summit 2017 [Videos for this event]

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