Stronger links offer brighter prospects

By Yao Ling | China Daily | Updated: 2019-03-28 08:33

China-EU can strengthen cooperation to promote their common interests and defend the multilateral trade system

On March 21, President Xi Jinping began a three-country trip to Europe. As his first overseas trip this year, it shows the great importance that China attaches to Europe. China and the European Union are the second-and third-largest economies and traders in the world respectively, jointly accounting for 38 percent of the world economy and 44 percent of the global trade in goods. In 2003, China established its comprehensive strategic partnership with the EU. The EU has been China's largest trading partner since 2004, and China has remained the EU's second-largest partner of imports and exports since then.

The rise of global trade tensions and unilateralism, protectionism and deglobalization have created a new era for bilateral cooperation and further economic and trade cooperation between China and EU, whether from the perspective of their own roles in the world economy or their close bilateral economic and trade relations, which will be beneficial to the stability and openness of the world economy.

Defending the multilateral trading system needs China-EU cooperation.

Despite different cultures, different social systems, and different phases of development, China and the EU have reached consensus on many aspects of international cooperation, such as upholding multilateralism, building an open world economy, supporting the rules-based multilateral trading system and promoting sustainable development, which is of great significance particularly in the context of the current situation when the world is witnessing growing instabilities and uncertainties.

It is well known that the World Trade Organization has played an irreplaceable role in maintaining the free and fair trading environment around the world, supporting the growth of global trade and facilitating the development of emerging and developing economies.

However from 2017, its Appellate Body has been suffering an existential crisis. To solve this issue, China and the EU, together with another 10 members submitted a proposal in November 2018 to reform the Appellate Body, the most urgent issue concerning the operation of the WTO, and are pushing forward a solution-oriented approach this year. China-EU cooperation on WTO reform could not only improve the effectiveness of the WTO, but also safeguard the WTO-centered multilateral trading system.

Deepening their strategic partnership needs greater China-EU cooperation. China and the EU both regard each other as an important partner for strategic cooperation.

In March, the European Commission released a document "EU-China: A strategic outlook", which has been interpreted as the transformation of the EU's policy toward China. Although it assertively highlighted the EU's interests more, China-EU cooperation remains the mainstay of bilateral relations.

In fact, China and the EU both regard each other as an important partners for strategic cooperation. In December 2018, China issued its third policy paper on the EU, identifying the direction, principles and specific measures to deepen the China-EU Comprehensive Strategic Partnership in the new era and promote greater development of China-EU relations.

On its part, the EU always looks upon the strategic partnership with China from the perspective of common development and prosperity. In September 2018, the EU published a document "Connecting Europe and Asia", officially responding to China's Belt and Road Initiative, which has clarified the principles that EU values in connectivity. In the past five years, nearly half of 28 EU members have signed memorandums of understanding on the Belt and Road Initiative with China, and China and the EU have initiated a series of synergies, such as setting up the China-EU Connectivity Platform and the China-EU Joint Investment Fund. The integration of the construction of the Belt and Road Initiative with the Europe-Asia connectivity strategy, China-EU cooperation will boost the connectivity of the Eurasia and boost the sustainable growth of the global economy.

Last but not least, China's new round of reform and opening-up enhances China-EU cooperation.

The economic and trade relations between China and the EU have always been a priority for China's opening-up strategy. In 2018, the scale of bilateral trade between China and EU amounted to $682.16 billion, while two-way investments have developed to being more balanced, with $119 billion of FDI stocks held by the EU in China compared to $86 billion of FDI stocks held by China in the EU at the end of 2017.

China is now making great efforts to push a higher level of opening-up and higher quality development. Since 2018, China has accelerated its opening-up, holding the first China International Imports Expo, developing the island of Hainan into a pilot free trade zone, and adopting the Foreign Investment Law, which aims to improve the transparency of foreign investment policies and ensure domestic and foreign enterprises are subject to a unified set of rules and compete on a level playing field. Amid this opening-up, strengthening China-EU cooperation will provide European enterprises new opportunities to benefit from China's further development.

The author is deputy director and senior research fellow of Institute of European and Eurasian Studies at Chinese Academy of International Trade and Economic Cooperation. The author contributed this article to China Watch, a think tank powered by China Daily. The views do not necessarily reflect those of China Daily.