Horizontal Agreement between EU and China: A Gamechanger for International Trade
The world`s two largest economies, the European Union (EU) and China, have recently agreed on a sweeping investment agreement known as the “horizontal agreement,” paving the way for increased trade and investment cooperation between the two sides. The agreement, which has been under negotiation for seven years, aims to create a level playing field for EU investors in China and promote sustainable development and fair competition.
The agreement covers a wide range of areas, including market access, investment protection, and sustainable development. Key provisions of the agreement include the removal of obstacles to investment, such as joint venture requirements and forced technology transfers, as well as increased access to China`s market for EU companies in sectors such as renewable energy, healthcare, and financial services. The agreement also includes provisions on state-owned enterprises, labor rights, and environmental protection.
One of the most significant aspects of the horizontal agreement is its emphasis on sustainable development. The agreement includes a commitment from China to implement the Paris Agreement on climate change and to improve its environmental standards, as well as a pledge to respect labor rights and increase transparency in government procurement. These provisions are important not only for promoting fairness and social responsibility but also for addressing the global challenges of climate change and social inequality.
The horizontal agreement has been hailed as a gamechanger for international trade, providing a framework for increased cooperation and investment between the EU and China. The agreement sends a strong message that both sides are committed to open and fair trade, despite tensions in other areas of the relationship. It also provides a model for other countries seeking to establish fair and sustainable trade relationships with China.
However, the horizontal agreement still faces some challenges and criticisms. Some observers have raised concerns about the enforceability of the agreement, particularly in light of China`s history of noncompliance with international agreements. Others have criticized the agreement for not going far enough in addressing issues such as intellectual property theft, human rights abuses, and unfair subsidies for state-owned enterprises.
Despite these challenges, the horizontal agreement represents a significant step forward for EU-China relations and international trade more broadly. By promoting sustainable development and fair competition, the agreement has the potential to create new opportunities for businesses and workers on both sides while also addressing some of the world`s most pressing challenges.
