V good points but overall I stick with the conclusion that this is a v risky deal.

1. It’s overstating it to say that COM now has final say over investment. FDI screening remains a MS competency. COM has had to take a v secondary supporting role over Huawei and 5G.

1/n https://twitter.com/IanaDreyer/status/1346196787682566145

2. Subsidy control we’ll wait to see what happens. But more generally it’s going to be v hard to override a determined MS’s views on investment, especially given how politicised this whole thing has become.

2/n

Berlin was pretty much conducting its own negotiations with China over this, with who knows what side deals. It’s v hard to imagine that Germany will effectively cede control to Brussels over what happens to its companies’ investments in China.

3/n

3. Investment screening/subsidy control are about Chinese investment in the EU, which this barely touches. Given imbalances of investment & relative strength of the tools available, if the EU gets into a game of who can be nastier to the other’s investors it’s going to lose.

4/n

4. US faces a difficult domestic situation having to row back from/replace phase 1. It would have been much easier to hop from that to a joint approach with the EU than have to go to China on its own and negotiate the same things from a position of relative weakness.

5/n

5. "EU has agency and interests in commercial and investment policy, and that way before the whole strategic autonomy hype.” Agreed. But this deal doesn’t look to me like it’s optimising them.

6/n

6. “Autonomous sanctions NOW better way to act.” Agreed. Now, how to get that past the likes of Volkswagen? This agreement sets that back by creating a long and sanctionless bureaucratic process about ILO conventions that China can spin out.

7/n

And meanwhile it massively undercuts the EU’s claim to the rest of the world to be exporting values via its trade deals.

8/n

7. “The best can be the enemy of the better.” Yes. But this is about option values. Unless you think this is a complement rather than a substitute to transatlantic cooperation, the value of waiting a short time to see what can be done with the US imho is clearly positive.

9/9