By Dr James F. Downes (Hong Kong Metropolitan University/ Global Europe Centre)
The Evolving Relationship
EU- China Relations have evolved considerably over the first five months in 2023. 2023 has seen a high-level delegation from the EU to China with French President Emmanuel Macron and EU Commission President Ursula von der Leyen making a visit to President Xi Jinping, in Beijing in April 2023. From China’s side, 2023 has seen a new Ambassador to the EU in the form of Fu Cong, who has sought a more pragmatic rapprochement with the EU. More recently, in May 2023, China’s Foreign Minister Qin Gang made a visit to Europe, in visiting Germany, France and Norway.
Economics
The relationship between the EU and China continues to be complex and multi-dimensional. On one hand, China is the EU’s second largest trading partner after the U.S and EU-China trade volume reached over $1 trillion in 2021. On the other hand, the EU has continuously criticized China over issues such human rights concerns, alongside challenges such as China’s lack of market access for EU companies, and challenges to the international rules-based system.
In 2023, these diverging economic interests are shaping the dynamics of EU-China Relations. We should expect the economic partnership to remain key in 2023, but with a more cautious and pragmatic approach from the EU. China’s growing global assertiveness and strategic competition with the U.S. is also influencing the EU’s stance towards Beijing.
The EU is also working to diversify supply chains and reduce its dependence on China for certain imports through its ‘strategic autonomy’ agenda. The COVID-19 Pandemic has arguably highlighted risks in being overly reliant on China for goods such as medical equipment. The EU will likely aim to reduce these vulnerabilities while maintaining economic cooperation with China where interests align.
Conflicts & Competition
Politically, the EU appears to be aligning more closely with the U.S. in response to China’s growing geopolitical assertiveness, recently adopting a “de-risking” economic strategy. Furthermore, the EU has expressed concerns over China’s aggressive foreign policy in the Indo-Pacific region. In addition, a number of EU member states remain divided on taking a tougher stance towards China. While countries such as Lithuania have pushed for a more confrontational EU policy. Other countries such as Italy, Hungary, and Greece have sought to maintain economic cooperation with Beijing. Germany also wants to avoid decoupling from China given its large trade surplus.
Another important dynamic is the growing strategic competition between the U.S. and China, which is shaping Europe’s own geopolitical calculations. The EU arguably sees the emergence of a bipolar global order and wants to avoid taking sides in a so-called new ‘Cold War’. But it also recognizes that cooperative multilateralism, which has underpinned the international global governance system for decades, is under threat from China’s rise.
Currently, the EU is pursuing an approach of ‘competitive cooperation’ – via an emphasis on cooperation in areas of mutual benefit but also healthy competition and strategic autonomy. The relationship seems set to remain complex, with economic engagement balanced against growing geopolitical rivalry and concerns over China’s authoritarian political system. Both sides have an interest in managing tensions and avoiding outright confrontation. The EU is likely continuing to promote its interests, values, and vision of an open, fair, and rules-based global order in its dealings with Beijing.
EU Policy Divides
There are also three main divides within the EU’s institutions towards its current China policy over the Comprehensive Agreement on Investment (CAI). Firstly, the EU Parliament is likely to reject any fresh attempt to ratify the CAI. Secondly, the EU Council President Charles Michel has been touted as wanting to revive the deal, with the EU Commission adopting a more “hawkish” (negative) approach towards China in recent times and the French President Emmanuel Macron adopting a more “dovish” (positive) approach towards China.
China: Foreign Minister Qin Gang’s Europe Visit
Geopolitically speaking, China’s Foreign Minister Qin Gang’s recent Europe visit may be a part of a wider “Divide and Conquer” Strategy by Beijing, in seeking to strategically increase rifts (policy differences) between the leaders of both France and Germany alongside the EU Commission under President Ursula von der Leyen. It can be argued that China’s Belt and Road (BRI) Strategy has also been deliberately targeting economically smaller and weaker EU countries, such as Hungary and Italy in recent times, which in some part caused the EU Commission under President von der Leyen to launch the EU’s Global Gateway Programme (in late 2021) as a direct policy response to the economic threat posed by China’s BRI.
Projections for 2023
The EU has become much more interventionist in International Politics, particularly in the last few months towards China, with recent overseas visits to Beijing by several EU leaders. Furthermore, China also appears to have adopted a more positive rapprochement in recent months towards the EU, alongside the new Ambassador (Head of The Chinese Mission to the EU) Fu Cong. However, it is not clear to what extent these recent moves by Beijing are genuine policy shifts or a form of ‘strategic stalling.’
Uncertainty is likely to dominate the EU-China relationship in 2023. The EU-China relationship in 2023 will depend on the complex interactions of geo-political and economic trends. The relationship could grow more strained or competitive, but deeper cooperation is also possible, especially on global issues.
This Blog Post is based on a recent presentation by the Author Dr. James F. Downes at the Jean Monnet Centre of Excellence “Improving Institutional Trust in Times of Pandemics” Workshop (Co-Funded by the EU) at Hong Kong Baptist University on the 21st May 2023.
For a more in-depth analysis of the latest developments on EU-China Relations in 2023, the Global Europe Centre at the University of Kent recently published a 14 Page Report titled: “EU-China Relations in 2023 Latest Developments.”