For five months, there has been a debate about how the return of US President Donald Trump, who has shaken the Western world, will change the EU’s relations with China. Now, with a stream of European senior officials heading to Beijing, we may soon have some answers, writes diplomat Clyde Kull in Postimees.
For five months, there has been a debate about how the return of US President Donald Trump, who has shaken the Western world, will change the EU’s relations with China. Now, with a stream of European senior officials heading to Beijing, we may soon have some answers.
Alongside senior Brussels officials who have taken a tough line on Beijing, EU member states from Western and Southern Europe, who have advocated a softer approach towards China and a distancing from Washington, are making the pilgrimage to China.
Each has slightly different aspirations. This points to the competing interests of EU member states and institutions at a time of geopolitical chaos that could create new fissures in the 27-member bloc’s often contradictory approach to China.
Relations between Europe and China have been difficult for years, and the return of US President Donald Trump has added a new layer of uncertainty.
EU member states have historically been divided on the issue of China, with some wanting an economic rapprochement while others insist on the need to “de-risk” or reduce dependence on Chinese markets and technology. Indeed, the EU has actively resisted China’s trade dominance by introducing new regulations that should reduce China’s impact on the European economy, particularly in the areas of green technology, semiconductors and pharmaceuticals.
European Trade Commissioner Maros Sefcovic’s recent visit to Beijing was aimed at reaching economic agreements that would open up the Chinese market to European companies and help redress the imbalance in trade relations. He was also tasked with persuading China to reduce its industrial overcapacity, which has led to a flood of cheap Chinese goods into European markets. A particular problem is the massive Chinese exports of electric cars and solar panels, which threaten European industry and businesses. In the light of the tariffs imposed by Trump, this is only getting worse.Sefcovic was accompanied by a list of proposals that could help promote goodwill in a troubled relationship. One area of cooperation could be Chinese investment in Europe’s electric vehicle and battery sector.
French Foreign Minister Jean-Noël Barrot, who was visiting at the same time, sought concessions on French cognac imports, which have become one of the casualties in the trade war between China and Europe.
Both European politicians tried to put pressure on China to distance itself from Russia, but no progress was made on this front. The closeness of China’s relations with Russia has proved to be one of the most problematic issues for the EU, as Brussels is now largely left to fund the defence of Ukraine alone, while China continues to quietly support Moscow. China could change its stance if it saw clear benefits, but for the moment Beijing seems more likely to wait and see how Trump’s policy develops.
There is a lack of consensus in the EU on China-US policy. So Spain, Portugal and Italy are trying to balance their trade relations with Beijing and promote investment.
During last week’s visit to Beijing, Portuguese Foreign Minister Paulo Rangel aimed to relaunch bilateral dialogue, while his government is considering postponing the purchase of US fighter jets because of Trump’s geopolitical positions.
On 8 April, Spanish Prime Minister Pedro Sánchez will be in Beijing on his third visit in two years to attract Chinese investment in Spain’s electric car and battery sector and pave the way for a possible visit by the King of Spain in the second half of the year. Sánchez, who has attracted attention as one of Trump’s fiercest critics in Europe, sees himself as a mediator between China and the so-called Global South.
Like Italy, which after a long period of uncertainty has begun to reopen its doors to Chinese investment – Italian Senate President Ignazio La Russa also arrived in Beijing last week – some other European countries, such as Hungary and Slovakia, are looking in the same direction. The Chinese are opening their own electric car factories in both countries.
China, for its part, is trying to take advantage of Trump’s tariff policy. As the Trump administration is stepping up pressure on the EU on trade terms, China may offer Europe concessions, such as better access to its market or investment in European industry. This in turn could create new divisions within the EU, as some member states, such as Germany and France, are more interested in limiting China’s economic influence. Germany, which has so far been a key country in shaping the EU’s economic line, is increasingly aware that overproduction of Chinese products could harm Europe’s industrial sector. Nonetheless, Germany is not ready to completely distance itself from China, which remains one of its largest trading partners.
Europe is increasingly coordinating with other countries its response to China’s market dependence. Brussels has, for example, stepped up cooperation with Japan and South Korea to reduce dependence on China’s semi-conductors, and the EU is considering further investment in Europe’s own advanced technologies. Germany has imposed tighter restrictions on Chinese investment in strategic sectors such as energy and technology.
In Brussels, the question has arisen as to whether Europe should now, with Trump back in the picture, also target its de-risking strategy against the US. European Commission President Ursula von der Leyen has publicly stated that the EU’s relationship with the US is very different from its relationship with China, but at the same time she has acknowledged in private conversations that Europe needs to prepare itself to cope. This means that the de-risking strategy could take on a broader scope and include Washington, traditionally seen as an ally.
Resolving this dilemma will not be easy. The EU and the US are the world’s largest trading partners. Trade in goods and services between them accounts for 30% of global trade, amounting to €1.6 trillion, and the two economies account for 43% of world GDP.
Europe has to decide whether to focus on strategic autonomy and reduce dependence on both China and the US, or to find a new balance point that does not undermine Europe’s economic and security interests. If the EU decides to move towards independence, it must accelerate its industrial and technological development and strengthen its defence sector. EU countries should also look for new economic partners outside China to avoid over-dependence on Beijing on the one hand and Washington on the other.
Europe is in a difficult situation where it must simultaneously reduce its dependence on China and take account of possible hostile moves by Trump. Europe may have to reassess its current strategy in the near future: should the ‘de-stricting’ of relations be directed only towards China, or should it also be directed towards the US? The answer to this question will shape the EU’s foreign policy in the coming years and will determine whether Europe will be able to maintain its strategic autonomy or remain a pawn in the geopolitical game of the superpowers.