Otherwise risk future access to European market
BEIJING: A European lobby group in China on Thursday slammed the country’s “unequal investment landscape” and called for it to drop wide-scale prohibitions on foreign investment, warning future access to the EU could be at stake.
The comments from the EU Chamber of Commerce in China come as Chinese buyers spend billions to snap up stakes in European companies, sports clubs, airports, and infrastructure.
“For the Chinese, Europe is a sumptuous buffet, anything goes, very nice, and for us it’s four dishes and a soup, you can’t do more,” the group’s president Jorg Wuttke told reporters at a briefing in Beijing.
The remarks preceded a statement from the Chamber said: “While Europe welcomes foreign investment, this lack of reciprocity is unsustainable and could lead to protectionism and increased tension.”
It added that it was in China’s interest to loosen restrictions and show Beijing “supports globally accepted principles”.
Chinese investment in Europe has surged over the past two years, growing 44 percent year-on-year in 2015 to 20 billion euros ($22.3 billion).
Beijing has urged its companies to go abroad in search of higher returns and advanced technologies to make Chinese firms more competitive in a range of high-value sectors, from aerospace to agribusiness and robotics.
And the first half of 2016 has seen numerous billion-dollar deals including a $43 billion bid for Swiss seed technology company Syngenta.
Among the top-drawer investments are the purchases of 219-year-old private German bank Hauck & Aufhauser, Italian tyre-maker Pirelli, and a portion of advanced robotics firm Kuka.
Pointing to these, the chamber said it is “almost impossible to imagine” European investors would be allowed to invest in similarly prominent Chinese companies, calling the situation “win-win results, but only in one direction”.
China ranked 84th globally – behind Saudi Arabia and Ukraine – in the World Bank’s ease of doing business index for 2016, and second to last in an OECD report on the restrictiveness toward foreign investment.
If Beijing does not lower market barriers, it cannot assume it will continue to be allowed unhindered access to the EU because this would be politically untenable, Wuttke said.
“The stark contrast between (the flow of Chinese investments into Europe) and the closed-up Chinese market will drive a lot of people to the conclusion that China takes advantage of us,” he said.
“As we have seen with Brexit, globalization also produces losers, and losers have a political voice.”
Some parties in Europe could now win elections on “an anti-China ticket”, he added, noting that thousands of steel workers marched in Brussels to demonstrate against the negative impact of China on their jobs.
China, which makes more than half the world’s steel, is widely accused in Europe of dumping its production on world markets and violating trade agreements at the expense of local jobs.
Last month the EU approved anti-dumping duties on cold rolled steel from China, its second-largest trading partner.
Chinese steel exports to the EU rose 28 percent in the first quarter of this year, while prices dropped more than 30 percent.