China key to EU's job crisis

As a result, the scourge of unemployment, and youth unemployment in particular, is now seen as one of the major obstacles to economic growth across the EU and the summit provided yet another golden opportunity to address the underlying causes and to recognize and promote decisive action that could contribute to a lasting solution.

Sadly, all we've seen is agreement on the allocation of about 6 billion euros ($7.8 billion) from the EU budget as investment funding for a new EU "youth employment initiative" that aims to offer people under 25 a promise of a job, training or apprenticeship within four months of leaving education or becoming unemployed.

While the initiative and the funding is to be welcomed warmly, it does little to provide any credible path toward substantial and sustainable job creation for the EU's increasingly lost generation of young people.

First, the sum is a drop in the ocean given the size and growth of this army of long-term, young unemployed. It also remains unclear whether this sum or part of it, will be targeted where the levels are most severe. Youth unemployment across Germany, the Netherlands and Austria lies at only about 8 percent, a far cry from the levels in Spain and Greece.

Second, and fundamentally, when and where this money will be spent remains undisclosed and probably even undecided; and crucially any causal relationship between government funding and job creation has not been presented.

However, it is of course, investment from business, and mainly private industry, that always spearheads any lasting decrease in unemployment with the creation of jobs that are based on genuine business and market expansion.

EU inward investment from China, therefore, represents the real, and possibly only, hope for lasting improvement in unemployment across the continent. Furthermore, these investment levels are set to continue, with the EU favored in many cases over the United States by many of China's cash-rich companies.

In consequence, it is vital that all future EU summits ensure that inward investment from China is one of the most important agenda items and that key representatives from Chinese industry and government are present and heavily involved in any summit dialogue.

European companies and consumers should hold no fear of the rise of China and Chinese industry. It is the invisible hand of Chinese investment that could act as a catalyst to EU economic revival.

The author is a visiting professor at the University of International Business and Economics, and a researcher at Nottingham University's School of Contemporary Chinese Studies.