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Study: China’s home advantage threatens Europe’s economic power

A catchphrase when it comes to the China-EU Investment Agreement (CAI) is “level playing field”. The CAI is supposed to guarantee European companies (better) access to the market in China. However, in its trade policy with the People’s Republic, including the CAI, the EU Commission has so far ignored an important point, warns the think tank European Council on Foreign Relations (ECFR) in a study prepared jointly with the Rhodium Group: The extremely protected and huge Chinese domestic market has allowed firms there to grow, make profits and improve their product quality simply because of the size of the market – with little or no pressure from foreign competitors. In turn, the firms that grew up in China could tackle the market abroad. The study’s authors warn of “serious consequences” for several sectors that are crucial to the EU’s future.

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