Joe Biden has called for stronger trade coalitions against China while the European Union draws closer to striking a deal with Beijing. As the US P
Joe Biden has called for stronger trade coalitions against China while the European Union draws closer to striking a deal with Beijing. As the US President-elect called for stronger coalitions against the trading superpower on the trade and economic fronts, the EU made headway in steps to agreeing on a bilateral investment agreement with Beijing.
The EU and China are extremely close to reaching a long-awaited business investment deal according to reports.
The deal, which would give EU firms better access to the Chinese market and improve competition conditions, is expected to be finalised this week.
Talks regarding the investment package began in 2014, but have been in deadlock for years over a number of issues.
The deal is due to open up China’s manufacturing sector to EU companies, in addition to construction, advertising, air transport and telecommunications, according to reports.
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An EU-China agreement is expected to cause frictions with the incoming administration of US president-elect Joe Biden.
However, the escalating tensions between the US and China are expected to have helped the Chinese position, officials claim.
Speaking from his transition headquarters on Monday, Mr Biden said: “As we compete with China and hold China’s government accountable for its abuses on trade, technology, human rights and other fronts, our position will be much stronger when we build coalitions of like-minded partners and allies.
“On any issue that matters to the US-China relationship, from pursuing a foreign policy for the middle class, including a trade and economic agenda that protects American workers, our intellectual property and the environment, to ensuring security and prosperity in the Indo-Pacific region, to championing human rights.
“We are stronger and more effective when we are flanked by nations that share our vision.”
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The United States and China have been in the midst of an economic cold war since 2018 as a result of increased tariffs.
Both countries would be negatively affected by a trade war, but both the US and Chinese leaders have made no steps to appeasing the tension.
Donald Trump’s administration targeted a number of technology companies from China as threats to national security.
Last week, the US placed export restrictions on more than 100 Chinese and Russian companies with alleged military ties.
China introduced tough new laws which restrict the export of “controlled items” earlier this month, with the rules primarily focus on the export of military technologies and other products that might harm China’s national security.
Mr Biden’s comments highlight the extent to which his position will align with the outgoing Mr Trump.
The EU deal is likely to infuriate the President-elect who discussed the importance of partnering with other democracies on China.
He said doing so would “more than double” the US’s economic leverage over the country.
Mr Biden added no global problem could be resolved by the US alone, including the US/China trade war, climate change and the coronavirus pandemic.
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However, Mr Biden’s rhetoric about getting tough with China may be difficult to achieve according to experts.
Josh Lipsky, director of programs and policy at the Atlantic Council’s GeoEconomics Center told the Wall Street Journal: “China is in a strong negotiating situation.”
He added: “The centrifugal forces coming out of China are stronger than they were in 2017.”
China is in a strong economic position this year according to the International Monetary Fund.
The IMF projects China’s economy will expand by 1.9 percent in 2020, making it the only major world economy to grow this year – mainly due to the debilitating effects of the coronavirus pandemic.
By contrast, the US economy is forecast to contract by 4.3 percent and the eurozone is predicted to shrink by 8.3 percent.