MEPs push Brussels to follow Biden on Taiwan trade

EU lawmakers are fed up with the European Commission’s reluctance to start an investment deal with Taiwan, while U.S. President Joe Biden has his sights set on trade talks with Taipei.

The indecision on the part of EU policymakers — out of fear of provoking Beijing, which could tear up the hard-earned but unratified EU-China pact — runs in stark contrast to Biden’s announcement to launch trade talks with the island “in coming weeks.”

For a large majority of lawmakers in the European Parliament, clinching a deal with Taiwan would be a major diplomatic show of support for the democratic and self-ruling island, which is coming under increasing military threats from Beijing. The Chinese authorities consider Taiwan to be their own territory.

Within the European Parliament, pressure is more tangible than ever for Brussels to step up to Taiwan’s request for talks on an investment deal, with the center-right European People’s Party, the Socialists & Democrats, liberal Renew group and Greens all converging around the idea. On Thursday, the international trade committee (INTA) overwhelmingly passed an opinion with 38 votes in favor, none against and three abstentions on “A new EU-China strategy,” in which the members explicitly called for talks with Taiwan.

For the European Commission, however, this is a problem. Brussels has been prioritizing an investment accord with Beijing but this now looks highly unlikely to be ratified amid tit-for-tat sanctions, and growing tensions over human rights abuses in Xinjiang and Hong Kong. The Commission has exclusive powers to negotiate Europe’s trade arrangements but sticks to a “One China” policy, meaning that “the EU does not have diplomatic or formal political relations with Taiwan.”

Kathleen Van Brempt, a Belgian Socialist lawmaker, said the Commission was “totally ignoring that this is also about the political signal … The Commission cannot ignore the European Parliament.”

Marie-Pierre Vedrenne, vice-chair of the trade committee from the liberal Renew group, said: “We share democratic values, green objectives and we have a clear reciprocal economic interest to strengthen our ties [with Taiwan] … These are sufficient reasons to call for an urgent start of an impact assessment and a scoping exercise with our partner.”

The compromise amendment on Thursday, which was struck between the EPP, S&D, Renew and Greens, “recalls, in the context of the regional dynamics, the importance of EU-Taiwan trade and economic relations” and “urges the Commission and the Council to move towards a Bilateral Investment Agreement with Taiwan and urgently start the impact assessment, public consultation and scoping exercise with the Taiwanese authorities.”

The trade committee’s chair, Bernd Lange from the Socialists & Democrats, also thought it was time for the Commission to get off the fence on Taiwan.

“It is time that we put words into action, we should launch an impact assessment as soon as possible,” Lange said. “Let’s analyse, in detail, if and how a bilateral investment agreement could benefit both the EU and Taiwan and then look at next steps. “

Taiwanese diplomats also weighed in, calling on the Commission to speed up a deal now that ratification of the EU’s Comprehensive Agreement on Investment (CAI) with Beijing is all but frozen.

“We are clear that any potential investment agreement between the EU and Taiwan should be completely decoupled from the ratification of CAI,” said a spokesman for Taiwan’s mission to the EU. “In view of the current freeze on the review and ratification process of the CAI, a Taiwan-EU investment agreement should not be held hostage to this ongoing process.”

Taipei calling

The EU’s stance essentially turns a deaf ear to the call made by Taiwan’s President Tsai Ing-wen, who last month called on Brussels to start negotiations with the island. “To reflect how far the Taiwan-EU relationship has come in the past few years, I believe it is time for Taiwan and the EU to restart negotiations on a bilateral investment agreement,” she said at the time.

At a meeting between MEPs and the Commission on Tuesday, the executive refused to budge.

According to MEPs and other people present at Thursday’s meeting, Commission officials said that they saw no need to pen an investment deal because business isn’t asking for this, and that the EU is already engaging with Taipei in other bilateral fora like the supply chain forum and investment forum

In the past, officials dodged the idea by saying that they wanted to ratify the EU-China investment deal before even considering starting talks with Taiwan and that they would need a mandate from EU countries. “The Commission has not yet considered the launching of investment negotiations with Taiwan,” a Commission spokesperson said in May.

On Thursday, when asked about how the Commission currently views the possibility of starting investment talks, a spokesperson did not answer directly. “We are looking into possible options to boost our engagement with Taiwan, which remains an important and like-minded trade partner. This is a work in progress in Brussels,” the spokesperson said.

China is warning the EU to stop any such work in progress. “The EU side has always insisted that it follows the One China principle. We urge the EU side not to have any official interactions in any form or nature with the Taiwan region,” a spokesman for the Chinese mission to the EU told POLITICO. “We oppose the signing of any agreement with implications of sovereignty and of official nature between those having diplomatic ties with China and the Taiwan region.”

The Parliament’s foreign affairs committee is set to vote on the “new EU-China strategy” report on July 15. As it moves towards a full plenary session in the fall, Parliament’s call to explore talks with Taiwan will only grow louder.

This article is part of POLITICO’s premium policy service Pro Trade. From transatlantic trade wars to the UK’s future trading relationship with the EU and rest of the world, Pro Trade  gives you the insight you need to plan your next move. Email pro@politico.eu for a complimentary trial. 

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