Sweden keen to push for progress within CAI
Nordic nation, in a key role within the EU, to continue consultations on China’s investment agreement
Sweden, which has held the rotating presidency of the Council of the European Union for the first half of this year, said it will continue to seek consultations with the European Parliament to push for the ratification of the China-EU Comprehensive Agreement on Investment, or CAI.
China and the EU reached an agreement in principle on the CAI in December 2020 after 35 negotiations spanning seven years. The European Commission described the CAI as “the most ambitious agreement China has ever concluded with a third country” and one that “will ensure that EU investors have better access to a fast-growing consumer market of 1.4 billion and that they compete on a better level conditions in China”.
However, the European Parliament blocked the ratification of the CAI after the EU and China launched sanctions against each other in March 2021.
Lars Danielsson, Sweden’s permanent representative to the EU, said on Monday that the council has been ready to move forward on the CAI, but it has faced a different opinion in the EU parliament on the issue, and lawmakers have not allowed it to move forward.
“As a residence, we, or I, will continue to consult with parliament to see if we can unblock the situation and see if we can move forward,” he said at a press conference where he presented the priorities for the Swedish presidency. “We like to move forward, but right now we don’t see the conditions because of the reasons I mentioned.”
Danielsson said he met Fu Cong, the new head of the Chinese mission to the EU, on Friday and briefed him on the situation.
A press release from the Chinese embassy about the meeting noted their talk on the China-EU investment agreement. At the meeting, Fu expressed the hope that Sweden, during its rotating presidency, would take a constructive and practical approach and maintain the upward momentum in relations between China and the EU.
Michel’s visit
Fu told the South China Morning Post in a recent interview that European Council President Charles Michel personally raised the issue of CAI during his visit to Beijing a month ago. The topic was also raised by Bjoern Seibert, head of European Commission President Ursula von der Leyen’s cabinet, during his meeting with Fu.
Fu said the CAI will take the economic relationship between China and the EU to a much higher level and will address many of the concerns of EU businessmen about market access and restrictions.
“So I would like to work with all my European colleagues to revive this agreement,” Fu said, adding that EU sanctions against China are unjustified and China’s sanctions were a response to those imposed by the EU on China.
Ding Chun, director of the Center for European Studies at Fudan University, said he is not too optimistic about the prospects of CAI due to the changed situation after the Russia-Ukraine conflict and the EU’s definition of China as a cooperation partner, an economic competitor and a system competitor.
“CAI is good for bilateral economic and investment relations, so it is possible to have some forms of flexibility on issues, but moving forward with the agreement as a whole is still a question mark now,” he said.
Ding believes that progress on the agreement depends on “opportunities, political wisdom and public sentiment”.
In an interview published in the latest edition of the Internationale Politik Quarterly, Germany’s leading foreign affairs journal, Sabine Weyand, the European Commission’s director-general for trade, said China remains an important partner for the EU.
On the growing argument surrounding the EU’s supposed over-dependence on China, Weyand said EU analysis suggests this type of dependence only affects about 6 percent of trade and 94 percent is “unproblematic.”
“But I want to be very clear: China is not Russia. We do not equate the two countries,” she said.
“China remains a major economy that cannot be ignored,” said Weyand, who was the EU’s chief negotiator during the CAI talks.