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EU may cut back on foreign direct investment
Last Updated: 2017-09-19 13:35 | China Daily
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In response to the European Union's new framework for investment screening, China urged the bloc on Monday not to take a protectionist path that discriminates against foreign investment.

Such a move was proposed last week by EU President Jean-Claude Juncker.

Juncker's proposal for a new investment screening framework is expected to grant EU members the power to interfere with foreign direct investment cases regarding strategic assets, especially those under State-controlled or financed enterprises.

"We hope the EU will follow basic rules of the World Trade Organization, especially the nondiscriminatory principle, to avoid any interference created by the rising protectionism sentiment," Foreign Ministry spokesman Lu Kang said.

He said that the EU also should not send chaotic and negative signals to the rest of the world.

China and the EU have been each other's major trading partners in past decades. Last year, China's trade volume with EU nations reached 3.61 trillion yuan ($552 billion), a year-on-year increase of 3 percent, according to the General Administration of Customs.

Meanwhile, the country made overseas direct investment of $ 170 billion last year, with Germany, Britain and the United States as the most popular destinations.

However, Chinese company purchases have faced interference in countries such as Germany.

According to a statement by the Chinese Chamber of Commerce in Germany, Chinese companies in Germany have concluded that they are likely to face even more political uncertainties in the future that impose additional risks on overseas investment, considering the commission's latest proposals and current changes to Germany's investment law.

The EU has advocated trade liberalization and investment facilitation, and already has received real benefits, Lu said. Everyone's interests are served in developing an open world economy when opportunities and benefits can be shared in openness to achieve positive outcomes, he said.

"The loss outweighs the gains to close the door and engage in protectionism for short-term interests," he added.

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