Four decades have passed since the
EU and China established diplomatic relations in 1975, and now became mutually
indispensable economic partners, presenting both an opportunity and challenge.
During that time, after the first market reforms were introduced in 1978, China
has transitioned from a predominantly agricultural to industrial and
service-oriented economy. On 11 December 2001, China also became the 143rd
member of the WTO. The aim of this research is to quantitatively compare the
US, EU and Chinese GDP from 1995 to 2014, the US and Chinese outward FDI from
1995 to 2013, and the EU 28 Total Imports from and Exports to the US and China
between 2002 to 2014, and analyse the impact of the exponentially rising
Chinese investments in the European Union (EU). We have found that while the US
economy experienced a regression in general, and exhibited outward FDI
exponential decrease in particular, the Chinese outward FDI sustained an
exponential growth. Our analysis has shown that the now weakened US dollar and
diminished US economic and industrial power, along with the US designed and
archaic post World War II European institutions, vitiated by the recent US
Economic Recession, which has swept along the EU and all other US dependent
foreign economies globally, are and will continue to experience the primary
impact of the exponentially rising economic investment of China in the EU.
Furthermore, we have found that the Chinese economic growth has been affecting
both the EU identity and policies. Yet, its full effect is waiting to be
realized. The Chinese investment in the EU is estimated to peak during the next
decade, when China will become by far the foremost economic partner of the EU.
This crossroad may be reached as soon as in few years’ time and contribute
towards the EU – Asian regional stabilization. In the changing context of the
Sino – EU - US relations, due to the exponentially growing economic prosperity
and rising global influence of China, the EU international institutions and
socio-political structures will re-emerge with the once forgotten access to the
21st Century Silk Road Economic Belt, “The Silk Road II”, between China and the
EU in the foreseeable future.
P.R. China, European Union (EU), United States (US), Sino-EU Relations, Global Recession, GDP, Foreign Direct Investment (FDI), Export, Import, Bilateral Investment Treaty (BIT), Protectionism, Belt and Road Initiative (OBOR), Silk Road Economic Belt (丝绸之路经济带), 21st Century Maritime Silk Route Economic Belt" (21世纪海上丝绸之路)