Chinese business struggles to “prevent further erosion of trust” with EU

Diplomatic and economic ties between the EU and China have suffered a setback over recent months and the business community has a “less favourable view regarding the ease of doing business in the EU,” according to the Chinese Chamber of Commerce to the EU (CCCEU).

Despite this, the Chinese commercial sector remains optimistic about its future on the bloc, and both parties can work closely on charting a stable economic recovery from the coronavirus crisis, said CCCEU Chair Zhou Lihong on Thursday.

The message comes just days ahead of a crunch meeting between a contingent of EU leaders and China’s President Xi, with Commission President Ursula von der Leyen, German Chancellor Angela Merkel and Council President Charles Michel attending as part of the video call on Monday (14 September).

Speaking to reporters in Brussels on Thursday (10 September), Zhou Lihong, spoke of how she hopes the concerns of the Chinese business community will be addressed by President Xi next week.

“Many Chinese companies are concerned about overlapping policies and overregulation,”.

“For example, the EU’s antitrust review and foreign investment screening,” Zhou said, are regarded by the Chinese business community as burdens to trade with EU member states. Zhou added that she hopes that such concerns emerge during the talks on Monday.

Speaking on the publication of a report from the Chinese Chamber of Commerce which seeks to encourage investment emanating from the country into the EU, Zhou also sought to send a warning to the bloc that investors from China could start to turn away from Europe should diplomatic ties be tested further.

Relations have recently been strained between the EU and China, owing to Western concerns over the erosion of liberal freedoms in Hong Kong, the alleged detainment of Uighurs in Xinjiang, and aggressive market protectionism in China.

The Chinese say that these are domestic political matters, and should not be the concern of global partners.

“Chinese businesses in Europe face enormous challenges for survival and growth, and some have even come under criticism and blame, much of which is unfounded but yet ruined the mutual trust and stability in economic and trade ties,” Zhou said.

“Chinese companies now have a less favourable view regarding the ease of doing business in the EU,” she added. “European institutions should pay close attention to the decline.”

The CCCEU has put forward eight policy suggestions to Brussels with regards to the future relationship between the two parties.

They include a deal to be concluded on the EU-China Comprehensive Agreement on Investment (CAI) by the end of this year, as well as the establishment of a platform for multilateral cooperation in trade agreements, and the de-politicization of cybersecurity issues.

“We can express the wishes of Chinese companies in the EU in just a few words,” Zhou said. “Openness, fairness, cooperation, and reciprocity.”

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