The EU-China investment agreement will open opportunities for both parties. At stake for the EU is greater access to China and its 1.4 billion consumers.

EU companies will get improved opportunities in rapidly expanding and highly lucrative Chinese industries including manufacturing, healthcare, financial services, and cloud computing . 

For example, in the air transport space - EU firms are expected to be able to compete for ground handling contracts, selling and marketing and computer reservations systems. They'll also be able to invest in select private hospitals - things that have been difficult, or impossible, in the past.

The deal also tackles state subsidies and forced technology transfers.

In return, China gains limited entry into Europe's manufacturing and renewable energy market as the continent embarks on a multi-billion dollar green transition. This access is on a reciprocal basis - meaning the more China opens to the EU, the more the EU will open to China.

In addition to the tangible gains, there are also some softer benefits. This deal will further intertwine the Chinese and European economies, building partnerships and trust.

China's President Xi Jinping said the deal would reinforce the international economic recovery following the coronavirus pandemic and boost confidence in globalization and free trade.

In a tweet, European Commission president Ursula von der Leyen said: "Tomorrow's post-COVID world needs a strong EU-China relationship, to build forward better," adding that it requires "reciprocity and trust."

One thing not included -  according to EU officials - is an investment protection clause - to safeguard company assets abroad. Both sides hope to continue negotiations so one is in place within 2 years of signing the deal. 

Wednesday's agreement was just in principle. The next step will be approval and ratification which is likely to take until early 2022.