China, EU enjoy bright prospects in economic, trade cooperation

China’s foreign trade with the EU totaled 4.05 trillion yuan ($620 billion) in the first 11 months of 2020, an uptick of 4.7 percent from a year ago, making China the largest trading partner of the EU.

As of November last year, China received actual investment of $117.98 billion from 27 countries in the trade bloc, and invested over $80 billion the other way around. These figures well explain the resilience and potential of China-EU economic and trade relations.

Though the COVID-19 pandemic has placed huge impacts on international air transport market, the Air France–KLM, the largest airline company in Europe, still expanded their cargo transport business thanks to the stable growth and market demand of the China-EU trade.

At present, there are two cargo flights of the group flying between China and Europe, carrying food, electronic equipment and garments from Europe, as well as medical supplies, smart phones, toys, and computer hardware from China.

Toon Balm, General Manager of Air France KLM, Greater China, said China is an important market of the group that enjoys huge cooperation potential. The country was the first to control the pandemic and resume work, and has basically recovered its domestic aviation market, which injected confidence for Europe to expect a recovery of its market.

China-Europe freight trains made 12,400 trips last year, carrying over 1.13 million TEUs (twenty-foot equivalent units), up 50 percent and 56 percent from a year ago, respectively. A total of 9.31 million pieces of anti-pandemic supplies weighing 76,000 tonnes were transported, which forcefully advanced anti-pandemic cooperation between China and countries and regions along the rail lines, and played an important role in stabilizing global industrial and supply chains.

Terespol, a border town in Poland, is the first stop of the China-Europe freight trains after they enter Europe. Its mayor Jacek Danieluk said the town has benefited a lot from the joint construction of the Belt and Road Initiative and the China-Europe freight service. The cargo service is expected to bring more investment to the countries along its routes, and Terespol looks forward to further deepening cooperation with China, he added.

An investigation by the EU Chamber of Commerce in China found that the pandemic didn’t discourage European enterprises from investing in China. Eighty-nine percent of the European respondents said they would stay in China, and 2/3 considered the country as one of their top 3 investment destinations. Many European enterprises were expanding their investment in China, the investigation said.

According to Fabrice Megarbane, president of the North Asia Zone of beauty giant L’Oréal, L’Oréal China secured a business growth of 20.8 percent in the first three quarters of 2020, and all its divisions saw their market share rise, especially the e-commerce and high-end cosmetics sectors. The robust performance in the Chinese market also helped the group secure positive year-on-year growth in the third quarter, he said.

Megarbane noted that China has a gigantic consumer group, which has created favorable conditions for the rapid development of digital economy. L’Oréal China is now a new innovation hub of the group, and its successful practices in the Chinese e-commerce market have been incorporated into the group’s training sessions, offering references for the group to do business in other markets.

Some Chinese enterprises also enhanced their investment in Europe. Chinese battery manufacturer SVOLT Energy Technology is expected to invest 2 billion euros ($2.4 billion) to build a battery plant and a research center in Germany. The plant, upon completion, will produce power batteries for 300,000 to 500,000 electric vehicles each year and create 2,000 jobs. Expert Stefan Di Bitonto with economic development agency Germany Trade and Invest said the investment from the Chinese firm will promote synergetic development of the industry, offer more job opportunities and enhance the international competitiveness of the German auto industry.

China’s Lenovo also announced to establish a new manufacturing facility in Ullo, Pest county of Hungary. The manufacturing facility will be mainly used to produce desktops and make data research. Anita Lukács, Lenovo country manager for Hungary said as the company’s business grows in the global market, the new manufacturing facility will better meet the demands of European clients.

Chinese and European leaders on Dec. 30 last year jointly announced that the two sides had completed investment agreement negotiations. The “balanced, high-standard and mutually beneficial” investment agreement demonstrated China’s resolution and confidence to promote high-level opening-up, and will provide greater market access, higher level of business environment, stronger institutional guarantees and brighter cooperation prospects for mutual investment. The treaty will also greatly boost world economic recovery in the post-pandemic era, and enhance the international community’s confidence in economic globalization and free trade.