China announces its contribution to investEU
At the High Level Economic and Trade Dialogue in Beijing on September 28, 2015 China announced its intention to contribute to the Investment Plan, as well as closer cooperation with the EU on investment issues in general
On September 28, 2015 during the High Level Economic and Trade Dialogue in Beijing, Vice-Premier Ma Kai informed Commission Vice-President Jyrki Katainen that China will contribute to the Commission’s EUR 315 billion Investment Plan for Europe. China is the first non-EU country to announce its contribution to the Plan.
As well as this announcement, the two sides agreed to set up a joint working group to increase cooperation between the EU and China on all aspects of investment. The working group will include experts from China’s Silk Road Fund, the Commission, and the European Investment Bank (EIB). The EIB, the Commission’s strategic partner in the Investment Plan, was also represented at the HED in Beijing.
The EU Commission and the Chinese government also signed a Memorandum of Understanding on the EU-China Connectivity Platform to enhance synergies between China’s “One Belt One Road” initiative and the EU’s connectivity initiatives such as the Trans-European Transport Network policy. The Platform will promote cooperation in areas such as infrastructure, equipment, technologies and standards. This will create multiple business opportunities and promote employment, growth and development for both sides, and it will be done in cooperation with the EIB.
Finally, the EU encouraged deepened collaboration between China and the European Bank for Reconstruction and Development (EBRD), including the examination of a possible membership in the EBRD in line with its rules.
Vice-President Katainen, responsible for Jobs, Growth, Investment and Competitiveness, said: “After a very constructive dialogue with Vice-Premier Ma Kai today, we have produced some real results for the future of EU-China cooperation in investment. This is the right moment to invest in Europe, and I am delighted that China has announced its intention to contribute to the Investment Plan. I am confident that other institutional investors will follow. We want to deepen our economic relations with China in the context of the Investment Plan, as well as the One Belt One Road initiative, to promote connectivity between EU and China.”
EU Commissioner for Transport VioletaBulc added: “I very much welcome the establishment of the EU-China Connectivity Platform. I am confident that it will bring significant benefits to both sides by exploring synergies between our respective infrastructure and investments plans and policies, as well as by providing business opportunities that will promote employment, growth and development in our countries”.
The High Level Economic and Trade Dialogue in Beijing follows the EU-China Summit which took place in Brussels on 29 June at which the two sides agreed to cooperate closely on investment, connectivity, the digital economy and low carbon investment. The HED advanced on the Summit commitment to converge on the scope of the bilateral investment agreement negotiations and produce a joint draft text by the end of the year. In Beijing, Vice-President Katainen was joined by Günther Oettinger, European Commissioner in charge of Digital Economy and Society, who successfully concluded a new agreement on 5G; and Commissioner Bulc, who held talks on transport infrastructure investment cooperation.
The Investment Plan for Europe has three objectives: removing obstacles to investment by deepening the single market, providing visibility and technical assistance to investment projects, and making smarter use of new and existing financial resources. According to European Commission estimates, the Investment Plan has the potential to add at least EUR 330 to EUR 410 billion to the EU’s GDP and create one to 1.3 million new jobs over the coming years. It aims to address the current situation where the EU has sufficient liquidity, but private investors are not investing at the levels needed. For more information, see this factsheet.
On 28 May 2015, just four and a half months after the Commission adopted the legislative proposal on January 13, 2015, EU legislators reached a political agreement on the Regulation for European Fund for Strategic Investments (EFSI) which is the heart of the EU’s Investment Plan. On July 22, 2015, the Commission agreed on a package of measures that will allow the EFSI to be up and running by early autumn.
In line with the European Council conclusions of December 2014, which invited the European Investment Bank (EIB) Group to “start activities by using its own funds as of January 2015”, the EIB has already approved several projects to be pre-financed in the context of the Investment Plan for Europe, in which it is the Commission’s strategic partner.
To date, nine EU Member States have announced contributions to the Investment Plan: Germany (EUR 8 billion), Spain (EUR 1.5 billion), France (EUR 8 billion), Italy (EUR 8 billion), Luxembourg (EUR 80 million), Poland (EUR 8 billion), Slovakia (EUR 400 million), Bulgaria (EUR 100 million) and the UK (GBP 6 billion/around EUR 8.5 billion).
Vice-President Katainen has travelled to 27 of the 28 EU Member States on the Investment Plan roadshow (Slovenia is the final stop on 9 October).
Factsheet on “EU – China Investment cooperation”
Following the conclusions of the EU – China summit, the EU and China representatives reaffirmed the strong interest in each other’s flagship initiatives, namely the Investment Plan for Europe, and the “Silk Road Economic Belt” and “21st Century Maritime Silk Road” (The Belt and Road Initiative), and discussed synergies between these initiatives. The High Economic and trade Dialogue (HED) has identified the following practical avenues for mutually beneficial cooperation: The establishment of a joint working group with the task of identifying by the end of 2015 concrete modalities for joint working and operational cooperation on the “Investment Plan for Europe”, including within the European Fund for Strategic Investment (EFSI) as well as other EIB Group activities. The working group will comprise of experts from the Chinese Silk Road Fund, the European Commission and the EIB Group, the latter as the entity responsible for the EFSI implementation.
Enhanced cooperation within the EU-China Connectivity Platform. The European Commission and the Chinese government are establishing the “EU-China connectivity platform” to explore synergies on connectivity plans, strategies and policies, identify areas where to enhance cooperation and develop a pipeline of projects. The Connectivity platform would provide visibility on investment opportunities along the Silk Road to interested investors and other parties, as well as to provide a level playing field for investors and relevant business in both sides. Some of these projects might be suitable for financing by EU resources (including EFSI) and/or Chinese funds (such as Silk Road Fund). The EIB would contribute to the work of the Platform so as to explore opportunities for co-financing infrastructure links between the EU and China, in the framework of EIB external mandates.
The European Commission will create a transparent European investment project portal (EIPP) gathering current and future investment projects in the EU. It should constitute a publicly accessible and user-friendly project database, providing relevant information for each project. This is open to interested investors from third countries, including China*.
The following Roadmap is foreseen between participants:
- · Recommendations of the joint working group on cooperation opportunities within the Investment Plan for Europe (by December 2015)
- · Implementation of the recommendations (first half 2016)
- · EU-China connectivity platform (starting as of October 2015)
- · European Investment Project Portal website launched (Q1 2016)
2. In addition, the European Commission and the EIB stand ready to establish cooperation with the Asian Infrastructure Investment Bank (AIIB) as soon as itis established in early 2016, via a possible Memorandum of Understanding (MoU) to cover inter alia technical assistance in start-up phase and potential for co-financing in projects of common interest involving the EIB. This framework would facilitate inter-institutional cooperation in ways that capitalize on each institution’s comparative advantages, so as to increase the efficiency and effectiveness of their activities in common countries of operation. Where appropriate, the EIB could consider the provision of technical assistance.
3. The EU welcomes China’s interest in playing a greater role in global economic governance, commensurate with its increasing weight in the global economy, and addressing the extensive global investment needs in a sustainable manner, among others through contributions to international financial institutions. In this context, the EU encourages deepened collaboration between China and the EBRD, including the examination of a possible membership in the Bank in line with EBRD statutory provisions.
*The EIPP shall primarily be for the purpose of visibility to investors and for information purposes. The inclusion of projects in the EIPP shall be without prejudice to their eligibility for financing under EFSI or any other EU/EIB instrument