EU hopes Beijing will hasten market reforms

BEIJING • Europe hopes China's Communist Party Congress next month will help to speed up the country's market reforms, the European Union's Ambassador to China said, calling Chinese criticism of an EU plan to screen foreign investment "unreasonable".

European Commission chief Jean-Claude Juncker earlier this month proposed an EU-wide investment-screening mechanism amid growing concern in Europe about acquisitions by Chinese state-controlled or state-financed firms.

China's Foreign Ministry has expressed concern over the plan, saying the losses from such "trade and investment protectionism" would outweigh the gains.

Ambassador Hans Dietmar Schweisgut said in an article published on the website of the EU Delegation to China on Thursday that it is "somewhat unreasonable that the EU is accused of protectionist tendencies" when Chinese regulations restrict foreign investment in industries that remain open in Europe.

He said: "Chinese investors have been able to buy 100 per cent stakes in EU car companies, banks or other key industries, while this would be impossible for European companies to do in China due to market access restrictions and forced joint-venture requirements." He noted that EU investment in China is now falling, saying: "This should be of major concern to China since European investors bring employment, tax revenue, innovation and high tech."

President Xi Jinping has repeatedly extolled the virtues of free and open trade to international audiences, but foreign business groups in China said Beijing has not been matching Mr Xi's messages with reforms at home.

REUTERS

A version of this article appeared in the print edition of The Straits Times on September 30, 2017, with the headline 'EU hopes Beijing will hasten market reforms'. Print Edition | Subscribe