China-EU Relations in a New Era of Global Transformation

Li Xing

• Publisher: Routledge
• Year: 2021
• eBook ISBN: 9781000407563
• Edition: 1
• Topic: Politics & International Relations
• Subtopic: International Relations
• Index: Politics & International Relations

This book draws together leading experts to examine the key issues in China-EU relations.

China-EU relations are increasingly complex and affected by a number of inter-related factors, such as China's global rise, growing China-US strategic competition, US global withdrawal, the transatlantic split, the China-Russia comprehensive "alliance, " and Brexit. The book highlights the struggles of both China and the EU to look for a dynamic and durable mode of engagement in an attempt to achieve the balance between opportunities and challenges, and between partnership and rivalry. International contributors explore how to conceptualise China-EU relations and identify their differences and commonalities such as the EU's role in China's foreign policy process and how the EU works with China as a strategic partner. Finally, it analyses China's and the EU's perceptions of their own present and future roles.

Shedding light on the perspectives of understanding and change in China-EU relations and its impact on multilateralism, it will appeal to researchers and professionals working in International Relations, International Political Economy and area studies who are interested in the rise of emerging powers and the changing world order.

1 China-EU relations at a crossroads

“systemic rivalry” or “strategic partnership”?

Li Xing

The China-EU conundrum – between strategic partnership and systemic rivalry

China and the European Union (EU) established formal diplomatic relations in 1975. Politically, China-EU relations are highly institutionalized in that they encompass a whole range of interactions such as an annual summit, regular ministerial meetings, and over 60 sectoral dialogues. China’s government has so far issued three policy papers on the EU (Chinese Ministry of Foreign Affairs, 2003, 2014, 2018) providing important guidance to the development of China-EU relations. Since 2013, the China-EU comprehensive strategic partnership has been broadened and deepened in line with the EU-China 2020 Strategic Agenda for Cooperation agreed at the China-EU Summit in 2013.

China and the EU are enhancing cooperation and are moving closer towards one another on a number of global and regional challenges, such as Iran and North Korea’s nuclear issues, multilateral governance, climate change, and free trade. On the one hand, the EU recognizes that “China plays a pivotal role in global governance and the rules-based international order, and this comes with responsibilities” (European Parliament, 2018). On the other hand, the EU is still struggling to adjust itself to the new situation in which “Beijing has begun to shift away from the narrow pursuit of national aims towards a more assertive foreign and security policy, and increased financial, economic and security cooperation with a global outreach” (European Parliament, 2018). Moreover, the EU is having difficulty in forming a unified position on a number of China-related issues, such as the use of Chinese telecommunication technology (Huawei), the “South China Sea” dispute, the “Belt and Road Initiative” (BRI), the China-Central and Eastern Europe (CEE) “17+1 cooperation format” as well as problems regarding Chinese state capitalism model and China’s commitment to human rights and democracy.

Economically China and the EU are each other’s largest trade partners. Many EU member states are involved in Beijing’s BRI initiative, and most of the member states join the Asian Infrastructure Investment Bank (AIIB). As China is moving fast beyond its lower-margin roots and climbing up global value chains, China-EU economic relations are changing from complementary to competitive relationships. China is also becoming a strong competitor to the EU in the third markets; for example in Latin America (García-Herrero et al., 2018), the relationships between China and the EU in the Horn of Africa are between complementarity and competition (Clingendael, 2018).

As the world enters into the post-Covid19 pandemic era, adhering to multilateralism under multipolarity has become the major consensus that has laid the foundation and defined the direction for China-EU relations. Both the EU and China are devoted defenders, supporters and practitioners of multilateralism, although their divergent understanding of multilateralism might be a problem. The EU considers China as a strategic partner for its objective of effective multilateralism in global governance. Both China and the EU regard the US unilateralism outside of the established international institutions on issues such as its withdrawal from the Iran nuclear deal and from the Paris Agreement as a great harm to the rule-based international system. Such common ground was reinforced at the China-EU Summit, June 22, 2020.

Nevertheless, when Italy signed up to China’s Belt and Road Initiative in 2019, along with Greece becoming the newest member of the China-CEE “17+1” forum, it was a wake-up call for the EU, and the EU was compelled to respond to China’s deepening economic and political footprint in Europe. Given the seriousness of China’s growing impact, the EU lately defined China as a “systemic rival” (European Commission, 2019). Beijing’s apparently expansive and ambitious domestic and foreign policy agenda prompts the EU to move China away from the previous “strategic partner” to the current “systemic rival.” The EU is increasingly aware that China is not only an economic and technological competitor but also a political and ideational contender promoting alternative models of development and governance. Chinese cultural influence, ideational impact and diffusion of ideas and norms unleashed by its economic rise are carrying weight in international relations.

Today, the impact of China’s rise is felt globally both in terms of hard power (capital, market, trade, resource, technology, military) and in the areas of soft power (culture, rhetoric, governance, development models, norm diffusion). The outward expansion of China’s investment and production in general and its BRI project in particular is of great concern to the EU. The EU has been adopting a “wait and see” approach to the BRI, and it has been worried about the 17+1 cooperation formula between China and East European and Balkan countries. The EU sees 17+1 formula as Beijing’s effort to “divide and rule.” As an extension to the BRI, China’s “Polar Silk Road” initiative is perceived as Beijing’s further attempt to extend its economic and political influence into the Arctic region. Moreover, China’s increasing presence in Africa and Latin America is supplanting the historical roles of Europe and the US in the political economy of the two regions.

Brexit (the process of the United Kingdom leaving the EU after the 2016 referendum) together with the Eurozone crisis, the refugee crisis, and the poor pandemic governance at the EU level is turning the image of the EU as an exemplar of regional integration and as a new “pole” in the world order to a disappointment of “unstable actor” (Chang and Pieke, 2018). Along with widespread right-wing nationalism and populism in some big and important EU member states, Brexit has further strengthened Euroscepticism concerning the future of European integration and its role as a global player. The EU is currently facing many crises in the most critical period in its history: economic slowdown, refugee burden, crisis of identity and legitimacy, rise of Eurosceptic parties, etc., while Brexit’s short- and long-term implications on China-EU relations are still under scrutiny, which needs to take into consideration the context of wider global uncertainties. One existing study (Summers, 2017) shows a mixture of comparative advantages and disadvantages on the varying impact of Brexit on China-EU relations across different areas ranging from trade, investment to education and tourism.

The EU’s new fault lines between China-US rivalry and China-Russia coalition

Among the risks and uncertainties in conjunction with the EU’s new identification of China as a “systemic rival,” the biggest challenge that the EU is facing is that it is currently caught between a rock and a hard place, a hardening fault line between China and the US’ global competition and rivalry.

In the last Summit of the North Atlantic Treaty Organization (NATO), allied heads of state and government gathered in London on December 3–4, 2019 to commemorate the 70th anniversary of NATO. 2019. The summit issued the London Declaration, in which it stated, “China’s growing influence and international policies present both opportunities and challenges that we need to address together as an alliance” (NATO, 2019). This is the first time in NATO’s history that its summit listed China as an independent topic and China was even involved in the joint declaration. It is plausible that such a swaying statement was the result of a compromise between some European countries and the US. More recently, China occupies the central focus of the newest NATO report – NATO 2030 (NATO, November 2020), a 60-page report that contains 138 recommendations for addressing the “challenge of rising China.” The interesting question is: why is China becoming a strong reason to unify NATO?

In early February 2020, the editor of this book was invited to speak at an international conference in Oslo, the Leangkollen Security Conference. The conference has a long history dating back to the first conference in 1965. Since then, the Leangkollen Security Conference has grown and gradually become one of the most influential security conferences in Norway. Surprisingly, the title of this year’s conference is “The China Challenge: Remaking the Landscape of Transatlantic Security,” and not surprisingly the conference’s focus was on China’s increased influence on the global stage and the impact this may bring about on the changing world order. This is also the first time in the history of the conference that it devoted an entire topic on China.

In the same month, the 56th Munich Security Conference (MSC) took place and the title of this year’s conference was “Westlessness.” Founded in 1963, the Munich Security Conference has become the most important platform for the exchange of views on global security issues and policy. It has evolved to become an independent forum where heads of states, governments, state officials, international organizations and various military and security policy-makers, and other socio-political forces meet to engage in an intensive debate on current and future security challenges. While this year’s MSC closed with little consensus on “Westlessness,” it was remembered as a moment of China-US confrontation when the war of words between the US and China dominated the conference. The China-US confrontation at the conference caused the further emergence of the fault lines within the EU and between governments and business communities.

One particular area where the EU is caught between the US and China high-tech competition is the issue of Huawei’s 5G technology. Some EU countries are caught in the crossfire and have felt obliged by US lobbying to abandon the use of Huawei 5G, while others are resisting the mounting US pressure on decoupling with Chinese technology. Dialectically, the Trump Administration’s aggressive campaign to prevent the EU countries from using Huawei, and its ban on the supply of chips to Huawei in particular, is both counter-productive and self-defeating. Washington’s war on Huawei will inevitably backfire because it alarms both the US’ competitors and its allies, who are compelled to think twice when using US products, and who will reduce the application of US technology in order to avoid Huawei’s situation. The worst unintended consequence for the US is that not only will it lose Huawei, the largest buyer of its semiconductor chip products, but will also push China into developing its own national chip ecosystem (Lairson et al., 2020).

The ongoing China-US trade war and their tech rivalry are splitting the world. Already in September 2019, the UN Secretary-General Antonio Guterres in his address to the UN General Assembly expressed his deep worry that a “great fracture” could split the international order by the largest economies who are creating two “competing worlds,” each with its own currency, trade rules, financial norms and zero-sum geopolitics (United Nations, 2019). This is what the EU is facing today – two competing worlds, one dominated by the US and the other by China. Such a de-globalization movement is against the EU’s promotion of regional and global economic integration.

The Europe-US transatlantic relations have been substantially weakened by a series of crises and a parallel change in US foreign policy as a consequence of its internal politics. In concrete terms, the transatlantic relationship is deteriorating as a result of the two sides’ widening gaps on the perspectives and positions related to global issues, international institutions and norms, multilateralism, climate change, and even NATO, the security core of the transatlantic relationship. The China-EU relations are unavoidably affected by the growing China-US global power competition. The EU is now facing a US-China trade war which is generating a great impact on the global trading system and which will potentially lead to a short-term disruption and a medium- to long-term destruction to the current global system. Still, the EU seems to be confident that the EU countries can uphold the values and norms they historically and culturally share with Washington while benefitting economically from greater engagement with China.

In a recent report Europe in the Face of US-China Rivalry by the European Think-tank Network on China (ETNC, 2020), Europe’s awareness of the fault line between “US unilateralism” and “Chinese assertiveness” is intensifying. The executive summary of the report based on 18 country chapters states clearly:

Despite the differences between the EU member states, its key finding is that all the countries analyzed are in a similar position. They all consider the US their most important ally and they all depend on its military protection, but they also want to do as much business with China as possible.

(ETNC, 2020: 15)

The report clearly reveals the fact that Europe is suffering from a “difficult balancing act between the US, a long-term strategic and economic partner, and China, the EU’s second most important market and, probably, the next economic superpower” (ETNC, 2020: 15). Europe is realizing that “We Europeans truly have to take our fate into our own hands” (Angela Merkel, cf. Paravicini, 2017).

Another new report on the EU’s China policy – Towards a “Principles First Approach” in Europe’s China Policy (Huotari et al., 2020) – is published by MERICS (Mercator Institute for China Studies), the Berlin-based think-tank. The report recognizes the difficulty and complexity that the EU has in attempting to position itself against the China-US rivalry, a conflict that “unfolds under conditions of deep economic, financial and supply chain interdependence and in a world that is unlikely to fall into two neat camps” (Huotari et al., 2020: 9). A clear recommendation from this report is that the EU cannot afford to lose its identity as a global “normative power” in its approach to China po...

Table of contents

• Cover
• Half Title
• Series Page
• Title Page
• Copyright Page
• Table of Contents
• List of illustrations
• List of tables
• List of contributors
• 1 China-EU relations at a crossroads: “systemic rivalry” or “strategic partnership”?
• 2 Europe-China and the Third Way: steering order in times of change. Evidence from the AIIB and WTO reform
• 3 Not getting its act together? The European Union’s policy towards China
• 4 China and the EU: convergence through multilateralism
• 5 The Russian energy and climate nexus and the Sino-Russian relationship
• 6 The EU’s struggle of “standing in two boats”: the dual complexity of the Belt and Road in China-EU relations
• 7 One belt, multiple roads: Moscow and Rome in China’s geo-economic calculations
• 8 The ideational impact of China’s Belt and Road in Europe: cooperation and competition as pathways of principle-diffusion
• 9 The evolving role of the EU in intensifying great power politics in the Arctic – potential implications for EU-China relations
• 10 European-Russian-Chinese Arctic energy system
• 11 China and Central and Eastern Europe: the case of the Baltic states
• 12 EU and China’s strategic partnership on the Blue Economy: challenges and opportunities
• 13 China-EU economic relations: where to go? Implications from a longitudinal case study of international acquisition
• 14 The role of culture in order-building: lessons from China’s engagement on the borders of the EU
• 15 Framing Chinese tourism in Europe: golden geese or gaggles?
• Index