China-EU relations face uncertain future despite investment deal

The agreement still has to pass the European Parliament, where members have expressed concern about issues such as Xinjiang and Hong Kong

The incoming Biden administration in the US will seek European support against China

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The two sides agreed an investment deal late last year. Photo: AFP

Published: 9:00am, 10 Jan 2021Updated: 9:00am, 10 Jan 2021

Both China and the EU have hailed an investment agreement between the two sides as a breakthrough, but the course of future relations remains uncertain with many potential pitfalls ahead.

European countries are still prepared to work with the United States to counter China and events such as the mass arrest of opposition politicians in Hong Kong are likely to cause further criticism of Beijing.

The investment deal is seen as a sign that the two sides can work together despite many grievances over their economic relations and pressure from the US, but observers cautioned that further problems lay ahead, while German Chancellor Angela Merkel – a key force in backing the deal – is planning to step down later this year.

Some have criticised the EU for rushing the investment deal with China ahead of Joe Biden’s inauguration in light of Western concerns at China’s actions in Xinjiang and Hong Kong. European observers think it is too soon to consider the deal as “definitive”.

“First, it is concluded ‘only’ in principle, without much precision; no text has yet been edited and when it will be, it has to withstand legal scrutiny. Second, it has to go through the European mechanisms,” said Sophie Boisseau du Rocher, a senior researcher with the French Institute of International Relations, a think tank.