Explainer | Why labour rights issues may sink the EU-China investment deal
- Landmark agreement still needs final approval and it’s likely to face resistance from European lawmakers over human rights
- Beijing has agreed to ratify two international conventions on forced labour, but critics say the pact lacks enforcement measures
What’s next for the deal?
The agreement will go through further legal and technical revisions before it is submitted for approval by the European Council and European Parliament, a process the EU has said it wants completed by early 2022. It is expected to face intense resistance from some European lawmakers, while international unionists – who say the pact will do nothing to stop human rights abuses or protect labour rights in China – have vowed to ramp up pressure over the deal.
What is the China-EU CAI and how is an investment deal different from a trade deal?
Christoph Scherrer, a professor of globalisation and politics and executive director of the International Centre for Development and Decent Work at the University of Kassel in Germany, said the language in the CAI “prioritises clearly free trade and investment over labour rights”.
“While encouraging investment by weakening domestic labour laws is called ‘inappropriate’, it also says ‘a party shall not apply domestic labour laws in a manner that would constitute a disguised restriction of investment’ as emphasised by the author of the agreement,” he said.
Why are workers’ rights so contentious?
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What has China agreed and not agreed to?
China, a member of the ILO, has already ratified four of the less controversial conventions – on equal remuneration, discrimination, the minimum age and child labour. It has also agreed to make “continued and sustained efforts on its own initiative to pursue ratification of the fundamental ILO conventions No 29 and 105, if it has not yet ratified them”. Both conventions relate to ending all forms of forced labour.
China-EU investment deal: Beijing relents on human rights but will it shift on trade unions?
But it has not agreed to ratify two more conventions that grant workers freedom of association and protect their right to organise, as well as to collectively bargain – issues that Brussels also wants included in the agreement. Analysts expect Beijing to push back on these two issues since they are deemed incompatible with China’s legal and political system.
Frank Hoffer, a research fellow at the Global Labour University and a former ILO official, said the EU should not be silent on human rights abuses though it may, in the short run, be unlikely to “convince or push China to do things they don’t want to do through a trade agreement”.
“The struggle also within Europe is to balance immediate business benefits with the objective of maintaining a rule-bound trading system respecting human rights,” he said.
Why is China so reluctant to ratify the conventions?
Governments in general are reluctant to ratify conventions that require legal enactment or revision for compliance. Sean Cooney, an international and comparative labour law expert at the University of Melbourne, said ratification of ILO conventions by member countries could expose them to its supervisory mechanisms for alleged failures in implementation.
“Moreover, ILO member states, as well as employer and worker organisations, can raise complaints and representations against states for non-compliance with conventions, leading to controversy at the annual International Labour Conference,” he said.
“Once they have ratified conventions, countries have to defend their record. Countries with low ratifications, such as the US and China, may be wary of these processes,” Cooney said.
The United States has ratified only two of the eight fundamental ILO conventions, on forced labour and child labour.
Will China take steps on forced labour?
Beijing may find it easier to ratify convention 29 as it is primarily directed at stopping private forced labour, including human trafficking, slavery and servitude, according to Cooney. But he said the second forced labour convention, No 105, could be politically controversial for China. It requires member states to suppress any forced labour as a means of political coercion, education or as punishment for holding political views or ideologies opposed to the established political, social and economic system. They are also required to stop using forced labour as a means of “racial, social, national or religious discrimination”.
“It is at an early stage but it is really a political question of what the EU would accept as effective implementation of convention 105,” Cooney added.
Could China follow Vietnam’s path?
After the European Union and Vietnam signed a free-trade agreement in 2019, Hanoi ratified conventions and enacted laws to allow independent worker organisations. However, experts do not expect China to go down the same path.
“The EU required Vietnam to ratify all core ILO conventions but the politics are quite different with China,” Cooney said. “Vietnam is less strict in controlling associations compared to China. Some domestic constituents in Vietnam have been calling for independent worker representative organisations but this is not so much the case in China.”
China-EU investment deal allows for arbitration to settle disputes, documents show
Will the deal improve workers’ rights in China?
It could lead to “incremental improvement” at best, in areas that are not completely incompatible with the nature of China’s political system, according to international law experts.
Surya Deva, an associate professor at City University of Hong Kong’s School of Law, said the deal had not resulted in any new commitments on labour rights, nor had a time frame been set for China to ratify the conventions.
“Even if China ratifies these two conventions related to forced labour in the best-case scenario, there is no guarantee of their meaningful implementation,” Deva said.
“Will it be realistic for some Uygurs to approach a Chinese court against alleged forced labour? The harsh reality is that unless China allows independent trade unions, creates space for civil society as well as the media to monitor labour rights abuses, and establishes independent courts, the situation will not change much on the ground,” he said.
The deal would have added value had it provided for an external system of monitoring and accountability for systematic labour rights violations, he said.
“Rather, the agreement expressly excludes issues related to the environment and labour rights from the state-to-state dispute settlement mechanism. In case of differences, the parties should resort to confidential ‘consultations’ or appoint a ‘panel of experts’ to make recommendations,” Deva said. “So it adds no ‘real teeth’ to what the EU and China already do – that is, conduct dialogue to find mutually agreeable solutions on contentious issues,” he said.
Why did China compromise at the eleventh hour?
“It is a symbolic deal … to show the US administration it has friends in other parts of the world, including allies of the US,” Le Corre said. “On paper, there is significant access to the Chinese market for large European firms in some sectors but ratification is still a long way off and a lot can happen on both sides.”
