EU-China talks on investment and market access must be conducted “with the highest possible level of transparency” and subject to parliamentary oversight, the European Parliament’s International Trade Committee has said.
This will be a precondition for the European Parliament’s consent to the deal, the committee of MEPs warned in a resolution voted on last week.
This deal, designed to protect investors on both sides, would be the first since the Lisbon Treaty made foreign direct investment an exclusive EU competence. It would replace 26 bilateral investment agreements that EU member states have with China today.
The talks come shortly after Malta and China signed a memorandum of understanding that will pave the way for the state-owned China Power Investments to become a minority shareholder in debt-stricken Enemalta, the Government-owned entity that is the main provider of energy generation and distribution in the Maltese islands.
Speaking in China last week, Prime Minister Joseph Muscat said Malta would not wait for the EU to act in forging closer economic ties with China.
He also said the Government would be seeking Parliamentary approval before finalising the terms of the energy deal.
However, the energy agreement was criticised by the Nationalist Opposition for the perceived lack of transparency and for allowing another country to have influence over Malta’s power supply.
The EU-China trade pact talks are set to take place next month.
A resolution setting out the European Parliament’s demands will be put to a plenary vote at the October session, shortly before the EU Council of Ministers is expected to authorise the launch of the talks.
Once the deal is struck, the European Parliament’s consent will be needed in order for it to enter in force.
MEPs say that the talks should start only after China has formally agreed to put its market access rules on the negotiating table and that any deal must deliver greater equality between the two sides’ investment environments.
Any deal should further include binding corporate social responsibility, social and environmental clauses, said the MEPs.
EU-China trade has grown rapidly in the past 30 years to €433.8 billion in 2012. China’s trade surplus with the EU was €146 billion in 2012, up from €49 billion in 2000.
In 2011, EU firms’ investments in China totalled €102 billion and China’s investments in the EU amounted to €15 billion.
Deal welcomed
The Maltese-Chinese Chamber of Commerce has welcomed the proposed investment by a Chinese company in Enemalta Corporation.
State-owned Shanghai Electric is pledging to invest some €200 million in Malta’s state-owned energy company.
MCCC president Maurice Mizzi said the proposed investment was a clear sign of the friendship between the two countries and would hopefully open the door to further similar investments.
He added that the company’s plans to manufacture photovoltaic panels for the European market was proof that the business model being promoted by MCCC was viable and attractive and should be emulated by other Chinese companies eager to expand their market in this region.