China-EU BIT and FTA: Building a Bridge on the Silk Road Not Detoured by Labor Standard Provisions

Abstract

It is time for European Union and Chinese leaders to build on the existing EU-China 2020 Strategic Agenda for Cooperation, quickly conclude on-going negotiations on their EU-China Bilateral Investment Treaty, and begin substantive negotiations on an EU-China Free Trade Agreement? China is now the European Union's second-biggest trading partner behind the United States, and the European Union is China's biggest trading partner. China is reaching to become the leader in globalism and is investing heavily to make it happen. One of the world’s largest projects, the Belt and Road Initiative is a primary driver of China's larger development strategy. A key aim of the BRI is to promote economic connectivity among countries in Eurasia by recreating the historic Silk Road along several land corridors and sea routes. While the parts of the project fit together like a giant jigsaw puzzle, one of the most important corridors is the road between the European Union and China where China is the European Union's biggest source of imports and its second-biggest export market. China is motivated to address historic obstacles and seize the opportunities for growth. At the same time, China can develop its own mega-regional free trade agreement as other such agreements grow around them, such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and the Comprehensive Economic and Trade Agreement, while China’s Regional Comprehensive Economic Partnership and European Union’s Transatlantic Trade and Investment Partnership languish. China’s first step might be an EU-China free trade agreement setting standards among the European Union’s 28 countries and China and paving the Silk road with a model for the 68 countries touched by the BRI encompassing about two-thirds of the world's population and 40% of global GDP. This paper will compare and discuss the possible accommodations necessary to reconcile the different approaches in free trade agreements by the European Union and China, with a focus on labor standards and dispute resolution provisions in their existing free trade agreements, in the context of current global obligations, including the International Labour Organisation, Organisation for Economic Co-operation and Development, and others.

Keywords: China-EU, BIT, FTA, Silk Road, Standard Labor Provisions