European Union suspends China trade deal over human rights abuses

The move came after officials and academics were hits with tit-for-tat sanctions over rights abuses against Uighur Muslims.

Valdis Dombrovskis pulled the plug on the procedure to ratify a once-vaunted ‘comprehensive agreement on investment’ with China. Picture: AFP

The EU has suspended ratification of an investment treaty with China after Beijing hit politicians, officials and academics with tit-for-tat sanctions over rights abuses against Uighur Muslims.

EU trade commissioner Valdis Dombrovskis pulled the plug on the procedure to ratify a once-vaunted “comprehensive agreement on investment” with China.

“We now in a sense have suspended political outreach activities from the European Commission side,” he said, in effect suspending the deal until further notice.

The agreement was agreed in principle on December 30 and hailed as a breakthrough for the EU’s “values-based trade agenda”. It was jeopardised in March when the EU imposed sanctions on four Chinese people, including a top security director, for alleged human rights abuses against the Uighur ethnic minority in the Xinjiang region.

In retaliation China sanctioned four entities and 10 EU citizens, who were banned from entering the country for “gross interference” in its internal affairs and “maliciously spreading lies and false information”.

British MPs are among others targeted by sanctions. Western brands such as H&M, Nike, Adidas and Burberry have faced boycotts by Chinese consumers.

Last week the European parliament warned the European Commission and Mr Dombrovskis that the deal would have to be “put on ice” until the Chinese sanctions were lifted. They target members of the European parliament, other elected officials, ambassadors, academics and think tanks.

The Latvian commissioner admitted that demands for China to withdraw the “regrettable and unacceptable” sanctions were now bound up with any prospect of ratifying the agreement.

The suspension dashes the EU’s hopes of finalising the deal before G7 leaders meet in Cornwall next month.

“It’s clear in the current situation with the EU sanctions in place against China and Chinese countersanctions in place, including against members of the European parliament that the environment is not conducive for ratification of the agreement,” Mr Dombrovskis said.

The investment deal was viewed with hostility by Washington and was rushed to the agreement stage before President Joe Biden’s inauguration.

The EU leadership and especially German Chancellor Angela Merkel were concerned that prolonging the trade negotiations would hinder relations with Mr Biden and Washington after the departure of Donald Trump.

Mr Biden is using the G7 talks to push the EU, and especially Germany, to take a harder line on China.

The sanctions row has shown the West that China will put sovereignty before trade, which is a blow to export doves such as Mrs Merkel, who personally brokered the investment deal. It was billed as opening up China’s long-closed state-dominated economy to European companies that would have unleashed tens of billions of dollars in manufacturing investment, especially from German companies.

Tweeting about the move, the liberal MEP Guy Verhofstadt wrote: “Rightly so! We need a balanced relationship (and) modus vivendi with China.”

The Times