The European Union and China said Friday they were closing in on an investment agreement after seven years of painstaking negotiations.

The two economic powerhouses are keen to tie up the landmark pact -- which would allow greater access to their lucrative markets -- before the end of the year.

"Negotiations have entered the last stretch," Chinese foreign ministry spokesman Wang Wenbin told journalists in Beijing.

In Brussels, EU officials briefed ambassadors from the bloc's 27 member states that "95 percent" of the deal had been wrapped up, sources said.

The deal would be a major boost for both sides and strengthen economic ties before the arrival of US president-elect Joe Biden in the White House in January, as Beijing squares off with Washington over trade.

Europe hopes to conclude a "political agreement" by the end of the year, but hurdles remain over China's commitment to labour rights, the EU sources said.

"We are not quite there yet but it's definitely feasible that, if things move forward as they are moving now, that we can conclude still this year," EU executive vice president Valdis Dombrovskis told Bloomberg TV.

Brussels insists it wants to secure the same treatment for its firms in China as it grants Beijing and will not swallow unfavourable terms just to get the years-long negotiations over the line.

"The EU remains committed to the end of year deadline for conclusion of the negotiations, provided we have a deal worth having," an EU Commission spokesman said.

"We will not put speed over substance."

A senior EU official said the Chinese had become "more flexible than ever" and "sent signals suggesting that they want an agreement before the new American administration is in place".

Brussels -- currently mired in the painful process of negotiating a post-Brexit trade deal with Britain -- has long sought to get barriers dropped for its investors in China in key areas such as emerging digital technologies.

The head of the EU chamber of commerce in Beijing Joerg Wuttke told AFP that negotiators had "apparently made great strides on market access".

As part of the accord the EU has also been pushing Beijing to reinforce respect for intellectual property, end obligations to transfer technology, reduce subsidies for public enterprises and improve on climate commitments.

- Trump tensions -

Europe's focus on negotiations with China has come as outgoing US President Donald Trump engaged in a bitter trade dispute with Beijing during his term in office.

In the latest salvo, Washington on Friday announced it had imposed export controls on China's biggest chipmaker, SMIC.

Brussels has preferred to forge a middle path, treating Beijing as both a potential partner and a "systemic rival", and pushing for changes to the World Trade Organization.

Talks on the investment pact have advanced despite major concerns in Europe over China's human rights record, especially its clampdown in Hong Kong and treatment of the Uighurs.

The European Parliament -- which must approve any agreement -- on Thursday backed a resolution condemning Beijing for its "government-led system of forced labour" targeting the Uighur and other Muslim minorities.

The EU has struggled for unity in the face of China's increasing global assertiveness under President Xi Jinping, with some member states urging a tougher stance on rights and the environment, and others preferring to boost trade.

Leading economic power Germany, which holds the bloc's rotating presidency until the end of the year, had made securing the deal a priority of its time at the helm.

A spokesman for Chancellor Angela Merkel said Friday "progress was made in the negotiation round in December, but the talks are ongoing".

"The goal remains to have an ambitious agreement between China and the EU," Steffen Seibert said.

Berlin wanted to get the agreement signed off at a joint EU-China summit in September, but the coronavirus pushed the event online and no deal was inked.

China pushed past the US in the third quarter of this year to become the EU's top trade partner, as the Covid-19 pandemic disrupted the US while Chinese activity rebounded.

China offers to work with Biden, warns of new 'McCarthyism'
Washington (AFP) Dec 18, 2020 - China's top diplomat on Friday offered cooperation on key priorities of President-elect Joe Biden, warning that Beijing's many US critics were creating an atmosphere of "McCarthyism" and ignoring common interests.

Taking aim at the hawkish approach of President Donald Trump, Foreign Minister Wang Yi voiced hope for a return of talks and "mutual trust" between the world's two largest economic powers after Biden takes over on January 20.

"It is important that US policy toward China return to objectivity and sensibility as early as possible," Wang said in a virtual address to the New York-based Asia Society.

Wang said that China saw "space for cooperation" with Biden on three of the four issues he has identified as immediate priorities -- Covid-19, economic recovery and climate change. Biden's fourth stated priority is racial equity.

On the pandemic, Wang said Beijing and Washington could collaborate in manufacturing vaccines and assisting third countries.

"We hope that we will expand cooperation and manage differences through dialogue," Wang said.

The Trump administration says that decades of US engagement have failed with China, accusing Beijing of rampantly stealing intellectual property, widespread espionage and coercion of other nations through its blitz of infrastructure projects.

In recent months, Secretary of State Mike Pompeo has terminated Chinese-funded exchange programs for Americans and tightened visa rules for Chinese students as well as members of the Communist Party and their families, likely affecting hundreds of millions of people.

"We see McCarthyism resurging and jeopardizing normal international exchanges," Wang said, referring to the witch hunt for communists purported to be in the US government led by Republican senator Joe McCarthy following World War II.

Wang accused unnamed senior US officials of "irresponsible presumption of guilt and emotional lashing-out."

"They ignore the vast common interests and room for cooperation between the two countries and insist that China is a main threat," Wang said.

"This is like misaligning the buttons on clothing. They get things wrong at the very beginning."

- New curbs on technology -

The Trump administration has shown no sign of tapering off its tough stance on China as it enters its final month.

On Friday, the Commerce Department said it was imposing restrictions on 77 entities that will need special clearance to receive advanced US technology.

The targeted entities include two prominent universities -- the Beijing Institute of Technology, which allegedly sought to secure US items to benefit China's military, and Tianjin University, which was accused of stealing trade secrets.

Four companies were also targeted for assisting China's drive to map citizens' DNA, a campaign that activists say is used to control minorities, especially Uighur Muslims.

"China's corrupt and bullying behavior both inside and outside its borders harms US national security interests, undermines the sovereignty of our allies and partners, and violates the human rights and dignity of ethnic and religious minority groups," Commerce Secretary Wilbur Ross said.

Pompeo separately marked the anniversary of the discovery of the first Covid-19 case in Wuhan to highlight the initial silencing of doctors who sounded alarm over the illness that has since killed more than 1.6 million people worldwide.

He accused China of continuing to obstruct an investigation into the virus by the World Health Organization, from which Trump has ordered a US withdrawal.

"It is also peddling vaccines that lack essential data on safety and efficacy, due to a fundamental disregard for transparency and accountability regarding results from clinical trials," Pompeo said as the United States began mass vaccinations developed after intense Western research.

"Both actions put Chinese citizens, and the world, at risk," Pompeo said.

Biden, who invested significant time in diplomacy with China as vice president, has broadly agreed that Beijing poses a global challenge and has called for a tougher response on human rights.

But he is expected to take a less bellicose tone than Trump, with his nominee for secretary of state, Antony Blinken, speaking of potential cooperation on climate change and the pandemic.

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