In what has been described as a “win for China,” the EU agreed on terms for an investment deal with Beijing following a video call between President Xi Jinping and bloc leaders including German Chancellor Angela Merkel and French President Emmanuel Macron. Chinese foreign direct investment (FDI) into the EU has increased exponentially over the last few years, primarily directed to the strategic areas of infrastructure and high technology and the deal seeks to strengthen these ties further. The European Commission dubbed the Comprehensive Agreement on Investment (CAI) as “the most ambitious agreement China has ever concluded with a third country,” but Mr Ellwood believes it was signed “prematurely” and could leave the bloc isolated.
He told Express.co.uk: “I think this was a mistake by the EU – to pursue this without consulting the US and the UK.
“If we are to have a comprehensive and effective strategy towards China then there needs to be cooperation.
“China will be delighted that it has managed to, yet again, drive a wedge between the strategic thinking of the West by signing the EU up to this.
“It will now mean the EU is less critical of any aspect of China’s behaviour and that is not where we want to be – particularly with the new occupants of the White House.
“[Joe] Biden wants to rejuvenate and reconsolidate Western resolve in stepping up to the geopolitical threat that China presents.”
Beijing has come under fire from the US in recent months, not least for its handling of the coronavirus outbreak, but also its aggression in the South China Sea and the introduction of a new security law in Hong Kong.
The President-elect has promised a tough approach to China after his inauguration on January 20, and now the EU could find itself stranded.
Asked if a potential free trade deal with the UK could be more lucrative as a result of the EU’s actions, Mr Ellwood believed it was possible if the Government plays its cards right.
He added: “We will have to wait and see how the trade deal pans out, but yes.
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“This is why the EU signing a deal prematurely is actually unhelpful.
“Even our own Integrated Review will recognise the threat that China poses – it’s not a direct military threat, the scale of their growth is too big for us.
“We don’t want to trigger a war. This will be played out in a Cold War scenario through espionage, and pressuring other countries to turn to their way of thinking.
“That is the bipolar world that awaits us unless we are able to regroup as the West and confront it.”