Chinese Premier Li Keqiang poses for a group photo with President of the European Council Donald Tusk (right) and President of the European Commission Jean-Claude Juncker before the 17th China-EU leaders' meeting in Brussels on June 29. (XINHUA)
The Chinese premier's trip westward expands upon stalwart areas of China-EU cooperation and opens up entirely new ones
There is an old Chinese saying that goes, "By the age of 40, one has no doubts about the world." This proverb can also be applied to the maturing state of China-EU relations, which is ushering in its 40th anniversary this year. From the frequent exchange of visits by top leaders of the two sides to many EU members' active response to the China-proposed Asian Infrastructure Investment Bank (AIIB) despite of U.S. dissuasion, the present relationship between the two parties appear better than ever. [Special coverage]
During Chinese Premier Li Keqiang's most recent European visit, the two sides also agreed to synchronize their economic strategies, a move which—as observers noted—has not only added new dimensions to their strategic partnership but also upped the ante with regard to peace, growth, reform and development.
Aligning strategies
Premier Li's trip to Europe from June 28 to July 2 consisted of visits to Belgium and France as well as attending the 17th China-EU leader's meeting and visiting the OECD headquarters.
In the joint statement made at the China-EU summit, the two sides agreed to support a synergy between the China-proposed Belt and Road Initiative, which consists of the Silk Road Economic Belt and the 21st Century Maritime Silk Road, and the European Fund for Strategic Investments (EFSI), also known as the Juncker Plan.
The Juncker Plan was first proposed in November 2014 by its namesake, European Commission President Jean-Claude Juncker. It aims to unlock investments from the private sector by guaranteeing part of the investment with funds taken from the EU budget and the European Investment Bank. The fund is hoped to reach a total of 315 billion euros (about $352 billion) earmarked for spending on infrastructural projects in three years (2015-17). Hopefully, that will provide the EU's economy with a much-needed kickstart. China's Belt and Road Initiative also aims to enhance interconnectivity from East Asia to Africa and Europe by developing a comprehensive transportation network encompassing railways, highways, airlines and seaways; and oil and gas pipelines; as well as transmission lines and communication networks. Under the initiative, a Silk Road Fund has been set up by China for improving infrastructure connectivity between Asia and Europe.
Zhang Min, a senior research fellow with the Institute of European Studies at the Chinese Academy of Social Sciences, claimed that as the new EU investment plan and the Belt and Road Initiative both focus on investment in infrastructure, Internet connectivity and smart energy grid construction, the integration of the two strategies should generate more opportunities in technology-related investment fields for both China and the EU.
Feng Zhongping, Vice President of the China Institutes of Contemporary International Relations (CICIR), said that the combination of the two initiatives is redolent of the fact that China-EU economic cooperation has reached a new stage, with areas of cooperation being expanded. While such cooperation meets the EU's needs in terms of upgrading infrastructure, it can combine the two sides' advantages in jointly exploring a third-party market.
In the past, China-EU economic cooperation largely focused on trade. Now the marriage of the two strategies is a major step for promoting international capacity cooperation, marking a period of in-depth development of relations between the two sides, said Feng.
Observers have also noted that the upgrading of China-EU cooperation is conducive to building confidence in terms of regional economic recovery as the EU is now at a crossroads regarding the revival of the European economy while China has entered a stage of slowed but more balanced economic growth.
When interviewed by China's Xinhua News Agency in Brussels, Wang Yiwei, Director of the Center for EU Studies at Renmin University of China, said that the coordination between China's Belt and Road Initiative and the Juncker Plan would stimulate European economic growth through connectivity and the expansion of the European single market to a Eurasian market.
According to some Chinese experts, the ultimate goal of the Belt and Road Initiative is to achieve the economic integration of the Eurasian continent. China and the EU are the two most powerful economies at the either end of the continent; therefore their attitudes will prove critical for the evolution of the grand objective. The conjunction of the two strategies has further enhanced mutual trust and shortened the psychological distance between the two economies.
Though China is at present the second largest trading partner of the EU while the EU has in turn been China's top trading partner for more than 10 years, the Chinese premier nonetheless expects China-EU economic ties to become even more in-depth in nature.
In a written interview with European media during his European trip, Premier Li said that the scale of two-way investment, a mere $20 billion or less in 2014, is hardly satisfactory given the sheer magnitude of the Chinese and EU economies and the huge volume of two-way trade.
The premier called for the early conclusion of the Bilateral Investment Treaty (BIT), which would provide Chinese companies with a smoother path to acquiring their European counterparts. The BIT negotiations have achieved some positive results so far, but differing viewpoints still exist regarding market access and investment rules and regulations.
Though China-EU economic relations have made remarkable progress, Zhao Jinjun, former Chinese Ambassador to France, claimed that the potential could be tapped to an even greater extent.
More areas for cooperation should be explored by the two sides, such as the feasibility of the establishment of a China-EU free trade zone, in addition to the BIT negotiations, Zhao said.
