Sino-European Relations: The EU’s China Strategy
There is increasing pressure within some Member States and other members of the international community for the European Union to adopt a more robust approach towards China in response to the proposed security law in Hong Kong that represents a violation of human rights and contradicts other founding values of the European Union.
The deep, economic Sino-European relationship has brought China and the EU closer together and allowed Beijing to develop its influence within the continent. While some Member States have moved closer to China others have pushed back therefore, creating a collective EU approach to China is not a straightforward process.
The EU’s relationship with the US has become strained under President Donald Trump, making it more difficult for Brussels to side with the US (and other Western allies) against China.
There is some indication the EU will introduce a more assertive and collective China strategy. There has been a change in tone in the 2019 ‘EU-China Strategic Outlook’ document suggesting Brussels is seeking more meaningful strategies to tackle increasing Beijing influence in Europe.
If the EU can unite Member States on China and create a universal and assertive policy, then the European bloc can stand up to Xi Jinping without moving closer to Donald Trump.
Hong Kong Security Law
Following the controversial Hong Kong security legislation proposed by China, the Sino-European relationship has come under greater scrutiny. The new law, which was backed by the Chinese government at the end of May, has caused widespread concern that the move will end Hong Kong’s unique status and the so-called “one country, two systems” would cease to exist (BBC, 2020a). This is because the security law would allow for Hong Kong citizens to be punished for criticising Beijing, as is already the case in mainland China. This has been described by critics as an act that would compromise freedom of speech in Hong Kong and would be a threat to the city’s autonomy (Kuo, 2020).
The international reaction to the legislation proposal has been momentous. The United States, the United Kingdom, Canada and Australia released a joint statement detailing their concern that the security law would “exacerbate the existing deep divisions in Hong Kong society”, while reminding China that the proposed law “lies in direct conflict with its international obligations under the principles of the legally-binding, UN-registered Sino-British Joint Declaration” (Foreign and Commonwealth Office, 2020). In addition to this joint declaration, the UK government have offered nearly 3 million Hong Kong citizens a right to live and work in the UK (Wintour & Davidson, 2020). While Western reaction to the proposed legislation has been widely praised, the EU response has received some criticism. Following a recent conference between foreign ministers, the EU chief diplomat Josep Borrell, reported Member States have expressed “grave concern” over the Hong Kong security law but have dismissed the call for sanctions, stating it is not “the way to solve problems in China”, which has been described as a soft approach by some critics (Barigazzi, 2020).
Another factor to consider while discussing why the EU’s Chinese strategy has come into question in recent months is Beijing’s handling of the Covid-19 crisis. China’s initial response to the outbreak in Wuhan has received criticism from the international community; Australia have called for an enquiry into the origin of the virus while Donald Trump has claimed his administration will be investigating China’s handling of the coronavirus, blaming Beijing for the crisis. Furthermore, as the Chinese crisis quickly unfolded into a global pandemic China has resumed tactics of ‘Wolf Warrior’ diplomacy.
The Hong Kong legislation and China’s handling of the pandemic are not the only causes of Sino-European relations emerging as a critical issue in recent months. In 2019, the EU published a strategic outlook paper which described China as a ‘systemic rival promoting alternative models of governance”; a toughening of the EU’s political stance on China, which could be observed as a watershed moment for the Sino-European relationship (Burchard, 2019). Some of the reasons that can explain why the EU adopted this new position towards China include: EU pessimism on Chinese economic reform; the furthering of Xi Jinping’s authoritarianism; EU leaders’ concern of the economic and political consequences of China’s Belt and Road Initiative.
This new wave of Sinoscepticism has been sweeping across the globe. In the UK, Labour foreign policy spokesman Stephen Kinnock, has described China as a “rival to democracy” (Wintour, 2020), while a group of Conservative MPs have recently formed the aptly named China Research Group, headed by Tom Tugendhat, the chairman of the Foreign Affairs Committee (BBC, 2020a). Tugendhat was also one of the four Foreign Affairs Committee chairs who have called for the United Nations to establish a special envoy for Hong Kong, in response to the proposed security law. Moreover, a collective of senior politicians from the EU, UK, US, Japan, Canada and Australia have come together to form the Inter-Parliamentary Alliance on China. The groups intend to work together towards reform on how democratic countries approach China (IPAC Global, 2020).
The Increasing US/China Divide
Furthermore, the Chinese and US rivalry has intensified in recent years and since the Covid-19 outbreak, the relationship between the two superpowers has soured further. The divide, although born from economic competition, has increasingly become a contest of ideology and consequently, the EU now finds itself in a precarious position. While it would be natural to assume the EU would ally itself with the US – a democratic state with the same values as Europe – against China, – a ‘systemic rival’ that champions an alternative system of governance to the West – the actions of Donald Trump make it difficult for the EU to do so. Therefore, the lack of definitive action from the EU on China, at least thus far, can be explained by considering Europe’s concern that doing so would leave only Trump as their chief partner (Kettle, 2020).
This has contributed to an unclear European China strategy, highlighted by those who demand for a more robust approach. Amongst those calling for more decisive action include Margrethe Vestager, the European Commissioner for Competition, who argues Europe need “to be more assertive and confident about who we are” in response to the growing divisions between the US and China (Wintour, 2020).
Over the last decade or so, China has become the EU’s second largest trading partner while the EU is now Beijing’s biggest partner in trade thus demonstrating development of a deep, economic EU-Sino relationship (European Commission, 2019). Andrew Small (2020), a policy fellow at the European Council on Foreign Relations, explains how the Eurozone crisis of 2009 allowed China to significantly increase its influence in Europe, through contribution to European Financial Stability Facility and by purchasing European bonds at crucial moments. Small argues these acts of financial goodwill were widely well received and has been reflected in European policy on China for several years since. Other scholars, including Karine Lisbonne de Vergeron, have detailed while the economic ties between Beijing and the EU were increasing before the financial crisis, it did accelerate the deepening of the ‘strategic partnership’, to the extent that the EU-China economic cooperation is now the second largest in the world (Lisbonne de Vergeron, 2020). Today, an average of one billion EUR a day is traded between the two (European Commission, 2019).
In the past, the EU sought to strengthen its relations with China. Reflected in the 2016 European Commission’s Joint Communication ‘Elements for a new EU strategy on China’, is how the EU had hoped for trade, economic, and foreign-policy reforms in regards to China, with the objective of increasing the connection with Beijing and assuring the partnership became fairer and more reciprocal. The 2016 strategy proposed the EU should seize the new openings to improve its relationship with Beijing and drive forward infrastructure, trading, digital and people to people connectivity between Europe and China (European Commission, 2016). This sentiment is echoed in the 2019 ‘EU-China A strategic outlook’; it details how China and the EU remain strategic markets for each other and how the growing Chinese domestic market and the country’s economic weight create important opportunities for Europe (European Commission, 2019).
Several European countries enjoy large trade relationships with Beijing, including Germany, the EU Member State who is most reliant on exports to China. Germany accounted for 45 percent of all EU exports to China in 2018, which was over 7% of German overall exports for that year (Hutt & Turcsányi, 2020). Moreover, products and services from the United Kingdom, France and Italy made up 33% of all EU exports to China in 2018 (Hutt & Turcsányi, 2020).
The 17 (+1) & Belt and Road Initiative
It is argued the Eurozone crisis also made Central and Eastern European governments more vulnerable to the lure of Chinese business opportunities in their attempts to recover from the economic hardship caused by the crisis. In fact, since the European sovereign debt crisis, Chinese investment within the region has accelerated rapidly through projects such as the 17+1 and Belt and Road Initiatives (BRI), and companies from China have increasingly targeted Central and Eastern European countries, including the Czech Republic, Hungary, Poland, Slovakia, Romania and Bulgaria.
The Belt and Road Initiative is a Chinese global development strategy which involves projects in over 150 countries including G7 member, Italy. Central Europe has a strategic location within the project for Beijing´s objective is to increase China-Europe commerce through building a stronger connection between Central Europe and the Mediterranean Sea. The BRI’s most important European project, the Budapest-Belgrade railway, is a significant example of this strategy, for it is widely expected to be the first instalment of a larger railway, with the end destination being in Greece at the Port of Piraeus, where the Chinese have invested heavily (Brînză, 2020). Hungary and China signed a 20-year, $1.9 billion loan deal for the Budapest-Belgrade railway project in April this year, with 85% of the project’s financing coming from China (Than & Komuves, 2020).
The 17(+1) initiative, which is essentially a platform for further cooperation on business and investments on infrastructure, transportation and logistics, technology and tourism amongst a group of Central and Eastern European countries, is widely seen as an extension of the BRI. According to analysis from the CSIS Reconnecting Asia Project, China has contributed around $15.4 billion toward infrastructure and other areas of investment in the 16+1 countries (now 17+1) since 2012 (Hillman & McCalpin, 2019). Chinese foreign investment targeted at these countries which include Romania, Bulgaria, Hungary, Croatia, Slovenia, Slovakia, Poland and the Balkan States, demonstrates how Beijing is seeking to gain access to regional markets as a means of finding a ‘back door’ to EU markets (McCaleb & Szunomár, 2017)This scheme has increasingly concerned the EU; in the European Commission’s 2016 ‘Elements for a new EU strategy on China’ it is stated Member States must conduct their bilateral relations with China – including in group settings such as the 16+1 format – in cooperation with the EU to ensure that aspects relevant to the union “are in line with EU law, rules and policies, and that the overall outcome is beneficial for the EU as a whole” (European Commission, 2016).
This economic influence has allowed China to apply pressure on European countries to support China in divisive political issues. In early 2020, both Slovenia and Slovakia requested support from the European Commission in their attempts to push back against China’s pressure to take its side on human rights issues, while in 2017, both Hungary and Greece blocked EU efforts to condemn China for human rights violations (Hutt & Turcsányi, 2020).
Wolf Warrior Diplomacy
Since the start Covid-19 pandemic, Xi Jinping’s diplomats have adopted an aggressive form of diplomacy, in an attempt to strengthen Xi’s support in China (Myers, 2020). Referred to as ‘Wolf Warrior’ diplomacy, Chinese officials have taken to social media and other platforms to hit back directly at any criticism of Beijing or the Communist Party, usually with reference to the coronavirus. A striking example of this form of diplomacy was when, in an attempt to push back against Australia’s criticism of its handling of the outbreak, China imposed a massive 80 per cent tariff on Australian barley imports (Smyth & Yu, 2020).
Another notable example was when the Chinese embassy in Paris posted an article on its website that suggested care workers in Western nursing homes had abandoned their jobs and were leaving residents to die, days after France had raised its Covid-19 death toll to include nursing homes, which the French government have stated is false (Irish, 2020). Other tactics of diplomatic aggression have been seen in other EU Member States too. In the Netherlands, Beijing officials recently warned shipments of essential medical supplies could be held back, in response to the Dutch government’s decision to change the name of its diplomatic office in Taiwan (Leonard, 2020).
In addition to ‘Wolf Warrior’ diplomacy, the Chinese Communist Party have increased their campaigns of propaganda and disinformation in Europe in response to the Covid-19 pandemic. For example, as detailed by the Centre for European Analysis, China have recently begun a huge and unprecedented propaganda campaign in Italy (Bechis, 2020). After sending medical aid to Italy as the country became overwhelmed with the coronavirus, Beijing began to spread disinformation; a remarkable example being the manipulated “Thanks, China!” video shared on Twitter by Chinese foreign ministry spokesman Hua Chunying (Bechis, 2020). It has proved to be a relatively successful strategy, recent polls in Italy suggest more than 50 percent of the public consider China a friendly country, while other polls have shown support for EU membership continues to fall (Baker & Emmott, 2020).
A More Robust Strategy?
Due to recent events in Hong Kong, Beijing’s decision to pursue ‘Wolf Warrior’ diplomacy in the wake of the Covid-19 pandemic and the increasing global divide between the West and China – both economically and ideologically – there is increasing pressure on the EU to adopt a firmer approach towards its relationship with China. This pressure on Brussels originates at many levels; NATO Secretary-General Jens Stoltenberg has described China as an increasing threat to “open societies and individual freedoms” and has called for a “more global approach” (Philp & Tang, 2020), while pro-democracy activist Joshua Wong, has appealed to the EU to establish a ‘Magnitsky Act’ framework for human rights abuses, vis-à-vis Hong Kong (Stolton, 2020).
There is some indication the EU will decide to adopt a more robust approach towards China. Member States including Sweden and Czech Republic have taken a firmer stance against China in a backlash against increasing malign Chinese influence in their countries while aspects of the ‘EU-China – A strategic outlook’, a Joint Communication from 2019, suggests a step towards a more assertive position on Beijing. The document states the European bloc must consider China’s evolving economy and political power in order to protect EU interest while also detailing a systemic rivalry between the CCP and Europe in terms of models of governance (European Commission, 2019). This is in contrast to the 2016 Joint Communication that proposed the EU drive forward the connectivity between Europe and China while aiming for stronger relations with Beijing, thus demonstrating a considerable change in EU strategy (European Commission, 2016).
There have been other developments that indicate Brussels will seek to adopt a more assertive strategy towards China. The EU is reportedly seeking new powers to review and potentially block takeovers of companies in Member States by rivals who have received unfair support from a foreign government (Fleming et al., 2020). This has been described as part of European strategy to rein in perceived unfair competition from China (Fleming et al., 2020). In addition, the EU have recently released a detailed report on how European institutions will tackle disinformation, including a commitment to hold foreign states accountable for disinformation campaigns in Member States. While presenting the new plans, Věra Jourová, the Commission’s vice president for values and transparency, warned “if we have evidence, we should not shy away from naming and shaming,”, before adding “we have witnessed a lot of accusations that the coronavirus has been developed in US laboratories, and also the overselling of the support from China in the EU” (Scott et al., 2020). This is the first time the Commission has officially named China as a source of disinformation.
However, taking a hard stance on China, is not a straightforward move for the EU and one reason for this is the US President, Donald Trump. Trump’s ‘America First’ foreign policy has had a negative response across the EU, particularly amongst Germans, who, since Trump’s inauguration, have one of the most negative views in Europe towards the US (Barkin, 2020). As the pandemic unfolded across the globe, officials in Germany claimed the US had offered the German company CureVac, which is working on a coronavirus vaccine, a large sum of money in return for the company to move to the US (Brzozowski & Lawton, 2020). Moreover, in recent weeks, Trump has pledged to withdraw 9,500 US troops from Germany which has further strained the US-German relationship (BBC, 2020b).
Another important factor to consider while discussing the EU’s strategy on China is the economic ties between the two for the bilateral partnership has increased significantly over the last decade. China has gained significant influence through its financial investment in Europe, as seen with the BRI and 17(+1) initiatives, while states including Germany have become heavily dependent on their exports to China. Moreover, Beijing continues to seek to expand its influence in Europe through foreign aid and campaigns of disinformation, as was demonstrated in Italy after the Covid-19 outbreak, and was also evident in Serbia, when the country’s President kissed the Chinese flag as he received Chinese medical supplies (Hutt & Turcsányi, 2020). While other countries, such as Hungary under Prime Minister Orban, have enthusiastically embraced Chinese investment. According to Agnes Szunomar, an expert on central European relations with Beijing, this convenient relationship with Beijing “fits well into the government’s communication strategy that Hungary does not need Brussels” (Hopkins, 2020). Consequently, this makes it challenging for the EU to create a common China strategy, as was evident when some Member States blocked attempts in 2017 to condemn China for their human rights violations.
As mentioned, some EU Member States have taken firmer action against the Chinese Communist Party. In 2019, when Sweden awarded a freedom-of-speech prize to the Hong Kong–based Swedish citizen Gui Minhai, the Chinese embassy in Stockholm warned that Sweden would “suffer the consequences” and earlier this year Minhai was sentenced to ten years in prison in China (Ramzy, 2020). In response, Swedish cities are reviewing and cancelling their co-operation with Chinese counterparts in addition to increasing political pressure to ban China’s ambassador to Stockholm from the country (Milne, 2020). Sweden was also the only Member State who asked for sanctions against China in a recent meeting between EU foreign affairs ministers. The Czech Republic have adopted a tougher stance on Beijing too; a result of Chinese scandals in the country over the last twenty-four months, which include Chinese infiltration of a top Czech university in an attempt to develop influence. Because of these scandals, Czech public opinion of Beijing is now among the lowest in the EU and has driven the country to seek closer relations with Taiwan (Gosling, 2020). Moreover, the US-friendly Romanian government have recently cancelled plans with Chinese companies to build nuclear reactors in Romania (Necsutu, 2020).
Other governments have taken an assertive position towards China. The UK have offered visas to Hong Kong citizens and are now reviewing their 5G policy in response to growing security concerns associated with Chinese company Huawei, and the US – who have offered support to the UK in response to Chinese threats to punish British bank HSBC and to break commitments to build nuclear power plants in the UK – have imposed sanctions on Huawei, restricting the use of US technology and software by the technology company (BBC, 2020b). Furthermore, Japan has stated its desire to take the lead with a G7 statement on Hong Kong security laws (Elaine & Takemoto, 2020). An indication that like-minded societies are taking a harder line on China, particularly in light of the recent events in Hong Kong. As a ‘systemic rival’, the CCP and their approach to governance is “incompatible with the founding values of the European Union” including democracy, fundamental freedoms and respect for human rights (Fulda, 2020). Therefore, the EU must follow its Western allies, clarify its position on Beijing and pursue a more assertive China strategy.
Several reasons as to why the EU must adopt a robust China strategy have been well stated in this paper. Other issues, including security concerns associated with Huawei’s 5G and Chinese aggression towards Taiwan, have barely been mentioned but are also important to consider when discussing Brussels’ relationship with China. Perhaps the strongest of all arguments is the proposed security law in Hong Kong. In the 2016 European Commission’s Joint Declaration on EU strategy on China, it is written the EU commits itself to strong links with Hong Kong and to promote respect for the Basic Law and “the One Country, Two Systems” principle (European Commission, 2016). Beijing’s proposed security law is a direct threat to both and therefore the EU must adjust its approach to China in order to remain committed to promoting respect for the current system in Hong Kong.
It is clear the EU need a universal and meaningful policy on China. The delaying of the EU-China Summit in Leipzig, originally scheduled for September, has allowed European leaders more time to determine how the bloc will approach their relationship with Beijing and, in turn, create a new common policy on China. While this is not a straightforward task due to the complex economic ties with China and the EU’s difficult relationship with the current US President, it however remains achievable. As China’s biggest trading partner, the EU has economic leverage which could be used to apply significant pressure on Beijing. Furthermore, if the EU Member States are able to unite in a meaningful way, the bloc will be in good stead to effectively stand up to Xi Jinping and China without moving closer to Donald Trump’s US. As a recent OpEd by Josep Borrell and European Commissioner for the Internal Market, Thierry Breton states, “the time has come for Europe to be able to use its influence to uphold its vision of the world and defend its own interests” (Borrell & Breton, 2020).
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