Putting the China-EU comprehensive agreement on investment in context

Abstract

This paper reviews the content of as well as the reception of the current state of the planned China-European union Comprehensive Agreement on Investment as per January 2021. Moreover, it forms some expectations regarding its economic effects. Key conclusions are that, in spite of a limited scope of new concessions beyond ones that are realized or planned anyway unilaterally, the agreement will likely boost not only investment but also trade, and it will likely establish a closer political cooperation between China and the European Union. One reason for the positive economic effects is the reduction in uncertainty about the mutually granted concessions for investment. However, further stimulating effects of the very agreement will be possible when accompanying it with concessions on trade in goods and services in the future.