EU-China investment deal on pause after sanctions fallout

Relations between the two have soured since December's deal

The EU and China have imposed sanctions on each other in recent months. Reuters

The European Commission said efforts to win approval for the EU's huge investment deal with China were effectively "suspended" because of soured diplomatic relations after retaliatory sanctions.

"It's clear in the current situation with the EU sanctions in place against China and Chinese counter-sanctions in place, including against members of European Parliament, the environment is not conducive for ratification of the agreement," EU Executive Vice President Valdis Dombrovskis told AFP..

Trying to ratify the deal "will depend on how broader EU-China relations will evolve".

In December, the EU and China approved a major investment pact, after seven years of painstaking negotiations, thanks to a final push by Germany.

The pact has been defended as a needed opening to China's long-closed economy for European companies, but was sure to face difficulties being ratified by the 27 member states and the European Parliament.

Former Latvian prime minister Mr Dombrovskis is leading that approval process in the EU, which has already met opposition from key members of the European Parliament.

The EU sanctioned four Chinese officials in March over suspected human rights breaches in China's north-western region of Xinjiang.

China responded with sanctions against European politicians, scholars and research groups.