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EU-China, between risks and opportunities

INTERVIEW WITH ENZO RIVELLINI, PPE, president of the European Parliament delegation for relations with the People's Republic of China, on the eve of the start of the EU-Beijing negotiations for an agreement on European investments in China and Chinese investments in Europe.

EU-China, between risks and opportunities

“This is the time when Europe should abandon uncertainties and fears, convincing itself that setting out to conquer the Chinese market is not a risk, but an opportunity, a great opportunity. To be faced, certainly, in a context of clear rules respected by both sides. But to face such a challenge, one condition cannot be renounced: the European Union will have to present itself to the negotiations with a single voice. Only in this way will it be strong and respected". Enzo Rivellini, belonging to the group of the European People's Party, chairman of the European Parliament delegation for relations with the People's Republic of China, is a staunch supporter of the convenience, for the European Union, of concluding a trade agreement with the Asian giant, which already today the second commercial partner of Europe (the latter, for its part, is the first partner for China). And he illustrates the reasons for this in this interview with Firstonline in Strasbourg in a period in which the subject of commercial relations with Beijing is among those in the center of attention by the European institutions.

The conversation with Rivellini took place practically the day after the Foreign Affairs Council entrusted the European Commission with the mandate to start negotiations on behalf of the EU (the duration of which should not go beyond two and a half years ) for an agreement on European investments in China and on Chinese investments in Europe. And on the eve of the third high-level meeting on the EU-China trade dialogue, scheduled in Brussels.

And it is also useful to bear in mind that the assessments of the president of the European Parliament delegation for relations with the People's Republic of China also followed the approval, by the Strasbourg Assembly, of the resolution which set limits that were sufficiently strict to respect ( rebalancing of China's huge trade surplus with the EU, respect for human rights by Chinese manufacturing companies, easing of the restrictions that currently weigh on European exports to China) within an agreement that, when (and if) will be concluded, it will also have to be submitted to the approval of the European Parliament.

FIRST online – Considering that the Chinese trade surplus in trade with the EU amounts (the latest figure refers to 2012) to 146 billion euros, that European exporters report serious difficulties in accessing the Chinese market, that Europe is overrun from Chinese products that are often counterfeited or do not comply with safety standards, where does your conviction come from, President, that a closer commercial partnership with China can be convenient for EU countries?

Ravelins – From the forecast, shared by the world's leading economic research institutes, that in 2030 – a date not too far from today – 60% of world GDP will be produced by Asian tigers, and therefore a very large part by China, and that at that epoch 220 million of its inhabitants will have reached an income level at least equal to that of Western countries, and which will therefore be by far the first world market. So what will the EU do: will it build a wall of protectionism or will it try to conquer a share of that immense market?

FIRST online – What is your answer?

Ravelins – The only sensible option, for a Union that already has 500 million inhabitants and about 13.000 billion euros of GDP, is the second. For us Europeans, choosing the former would be madness. If the table of comparison were to be fragmented into 28 segments, one for each EU Member State, we would all lose. Even those countries, such as Germany and France, which today are in the forefront of courtship in Beijing driven by the illusion of being able to obtain some advantage over other Europeans. 

FIRST online – And will they succeed?

Ravelins – In the immediate term they could, but in a medium-long term perspective certainly not. For the simple reason that the Chinese are already struggling today to unravel the labyrinth formed by 26 different regulatory, economic and commercial systems (there are many commercial agreements signed by Beijing with as many EU Member States) and will end up preferring a single agreement with the European Union. It will suit them too.

FIRST online – Europe is therefore starting, according to you, towards a marriage of interests with China. Are there no other options?

Ravelins - I really do not think so. Why? The Chinese are interested in Europe, a huge market to sell their products. And we Europeans, if we decide to think with our feet on the ground, will realize that expanding towards China could be very convenient. But we will have to change our mentality. 

FIRST online - In what sense?

Ravelins – We will have to be more and more practical and concrete, to catch up with the Chinese. Who are already tired of the difficulties they encounter in Europe. Where in perspective there is not a single port - they say - capable of disposing of the enormous quantities of goods that they plan to send to our parts.

FIRST online - So?

Ravelins – In just a few years, they have started the construction of a gigantic work: a high-speed railway line which will be used exclusively for the transport of goods. Ten thousand kilometers of tracks that will connect the Chinese city of Zhengzhou to Hamburg in the record time, for that distance, of fifteen days. And we, in Italy, are still unable to complete the construction of the high-speed section in Val di Susa…

FIRST online – Yes, of course, the Chinese are more efficient than us Europeans. And yet they manage to achieve certain results thanks to forced labor in concentration camps: a practice that is repugnant to us Europeans…

Ravelins – And here a chapter of discussion opens which on our part requires a different, less ideological and more pragmatic approach.

FIRST online – That is, specifically?

Ravelins – It is a question of entering into a balanced negotiation between two subjects with equal dignity and capable of nurturing mutual respect. Therefore starting from the assumption that this agreement with China must be the first step towards a change of strategy. And never forgetting that the Chinese are particularly touchy on certain issues.

FIRST online – Are you saying that we need to set aside the issue of respect for human rights in China or that of protection against counterfeiting?

Ravelins – I say that it is appropriate and right to hinge the relationship in a context of rules. And I add that we Europeans cannot go below a minimum threshold of acceptability. But I also maintain that starting a negotiation with the Chinese starting from the question of human rights means being told that "these are internal issues", and therefore scuttle it from the start.

FIRST online – What could be, in your opinion, an approach aimed at a better reception from the Chinese side?

Ravelins – Raise the question of legally improving the mutual protection of investments in key areas of technology and intellectual property law, reducing barriers to investment in China by ensuring better access for European companies to the Chinese market, and addressing without delay the issue of the mandatory joint venture imposed by China on foreign companies in order to set up business in that country. In short, to be clear, an approach like that of my Northern League colleague Matteo Salvini when he shouts that "this Europe and this euro are a scam, they are responsible for thousands of suicides and millions of unemployed" is a dead end.

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