Monday, 14 October 2013

EU and economic clout

Chris Davies MEP, in his regular newsletter, cites two examples of the effectiveness of the EU.

Firstly, Ukraine is resisting bullying from President Putin to join a Russian-led trade alliance and is close to signing instead an accord with the EU. Uncertainties remain as to whether President Viktor Yanukovych will accede to European demands for the release from prison of former Prime Minister Yulia Tymoshenko and for introduction of fairer electoral arrangements, but the signs are good.

Secondly, EU governments may next week give the European Commission a mandate to negotiate the first ever investment and market access deal with China. This could be a major advance. China is the EU’s second biggest trading partner but it is enormously harder for EU companies to get a stake in the Chinese economy than the other way around. Recent reports from China suggest that the country has a strategy of providing financial support for exports to Europe that risk destroying our domestic industries; "establishing global supply chains that allow China to control prices". We need to counter this.

Osborne, Cameron, Davey and even Boris Johnson have negotiated large inward investment deals. (Incidentally, does Chinese investment in the Manchester Airport industrial park imply that Manchester has overtaken Birmingham in the race to become the UK's hub airport?) However, there is less sign that they have achieved any advances for British business in China.

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