The multi-layered European strategies towards China face hurdles due to the absence of a cohesive EU institutional policy, and disparities in individual states’ China plans. This latter complexity could be the base which hinders the establishment of a coherent and interconnected approach, underscoring the need to scrutinize it more closely.
1. Intricacies in EU Member States’ relations with China
European countries have adopted varying approaches toward China, spanning comprehensive national strategies to more ad hoc measures. Historical connections, economic stakes, security considerations, past Chinese retaliatory responses, and prevailing political ideologies contribute to shaping these responses.
Two noteworthy instances include China’s increasing presence in Europe via the Belt and Road Initiative (BRI), joined by eleven member states, and the 16+1 framework involving Central and Eastern European countries. These mechanisms have sparked apprehensions regarding Beijing’s drive to extend its influence, perceived as potential threats to European unity and coherence. Consequently, countries might be reevaluating their involvement in these ventures to safeguard sovereignty and counter excessive reliance. Currently, the 16+1 format has become 14+1, and a significant alteration is anticipated in the BRI by late 2023, involving Italy’s departure.
Emerging patterns suggest that European countries are pursuing economic diversification beyond China, particularly concerning supply chain dependencies and vulnerabilities linked to critical resources. Evaluating how extensively European states are exploring trade and investment prospects with different Asian economies, like India, Indonesia, Thailand, and Vietnam, can offer valuable insights into their approaches to bolster economic resilience and regional engagement.
Furthermore, by scrutinizing these factors, European institutions can better comprehend member states’ priorities and pinpoint potential areas of EU cooperation or strain.
2. Fragmented Europe’s National Strategies in China Relations
Only four EU member states have established official national strategies concerning their relations with China. However, they resemble position papers more than strictly binding strategies. The Netherlands took the lead in 2013 and revised its “Netherlands and China: a new balance” in 2019. In the same year, Sweden adopted a “Communication.” Finland introduced the “Governmental Action Plan on China” in 2021, while Germany solidified its position with the “Strategy on China,” 2023. In parallel, EFTA members Norway and Switzerland have established their own China policies.
Significant EU players — France, Italy, Spain — lack well-defined formal strategies. This deficiency necessitates piecing together fragmentary details from documents and declarations to grasp their respective stances, an absence of strategic orientation which erodes essential alignment both within domestic administrations and across the EU. In specific cases, countries such as Spain lack a strategy entirely, even though China stands as their primary trading partner.
In 2023, several countries have embarked on the process of formulating unofficial or partial China strategies. A compilation report by the European Think-tank Network on China (ETNC) in July 2023 indicated that three EU countries are currently developing pertinent “China-specific approaches” (Ireland, Belgium, and Austria). Furthermore, seven nations incorporate considerations related to China within their broader— fractional — and sector-specific strategies (including France, Spain, Czech Republic, Greece, Lithuania, Denmark, and Latvia). Conversely, a few countries —Bulgaria, Hungary, Poland — have yet to accord significant importance to China in the agendas, despite substantial trade dependencies.
Source: ETNC, July 2023.
3. Case Study: Inaugural German Strategy on China
China has traditionally favored bilateral engagement with member states, employing a ‘divide et impera’ stratagem instead of collective EU dealings. From China’s perspective, Europe is a dual-headed hydra represented by Germany and France. France’s skill in managing U.S.-China tensions appeals geopolitically, while Germany’s consistent role as China’s main trade partner for the last seven years holds economic significance due to sales and the industrial-supply-chain dependency.
However, only Germany currently possesses an official China strategy, a factor that demands particular attention. Germany wields a substantial degree of economic influence within Europe, standing as a formidable industrial hub and a leader in exports. Its political clout emanates from a pivotal role as a core EU member, historically shaping policies and propelling the course of integration. Consequently, the stance that Germany adopts toward China assumes paramount significance.
The notion of “Wandel durch Handel” had initially been Germany’s ambition, aiming to steer China towards a democratic trajectory, which ultimately faltered. Ironically, Germany is more vulnerable to China trade in the present day. It is worth noting, though, that the substantial weight of business considerations in Germany appears to impose constraints on their political maneuvers on China policy.
In July 2023, tactically timed with the COSCO deal close and after Chinese PM Li’s Berlin visit, Germany unveiled its inaugural China strategy. This alignment successfully brings together a significant portion of the German population under these ideas, with only the most radical factions remaining as exceptions.
The strategy reflects the shifting dynamics of the global scenario, conducting an examination of China’s evolving influence under Xi’s leadership. Prioritizing the expansion of supply chains and export markets, it aims to uncover vulnerabilities, minimize external disturbances, and bolster German companies’ comprehension of the risks associated with conducting business in China, to safeguard exports and prevent undesirable technology transfers, particularly concerning sensitive dual-use or security-related technologies.
Notable distinctions emerge across the four cardinal directions: to the north lies the emphasis on incorporating a broader European perspective, encompassing a collaborative stance; Southward, German perspective dominates, reflecting national positions. Towards the east, the strategy assumes a vigilant posture, prioritizing a robust trade relationship with Germany’s foremost commercial partner. Conversely, the westward direction brings into focus the intricate web of political considerations, particularly concerning human rights and the nuanced interplay of autocracies-democracies. This sentence summarizes the puzzling content: “Systemic rivalry with China does not mean that we cannot cooperate.”
While the direction provided by the German approach to China is manifest, translating it into tangible policy presents challenges. Germany aims for cooperative engagement while managing risks, highlighting China’s strategic goal of leveraging “economic and technological dependencies” for political gains. It underscores China’s pursuit of “regional hegemony” and intents to reshape the global order while challenging established international norms, mixed with concerns over “grave violations of human rights” in three regions and China’s involvement in “economic and academic espionage” — a major apprehension for the United Kingdom as well — all in accordance with their recently issued National Security Strategy. The document asserts China’s “illegitimate interference” (three times) and “transnational repression” and underscores direct security implications, such as the Beijing-Moscow alliance.
While the strategy affirms the intention to strengthen European unity in dealing with China, more precise steps remain undecided. For instance, the reiterated ‘de-risking’ is milder than the European Commission’s approach in the European Economic Security Strategy (2023). Germany’s proclaimed dedication to enhancing European coordination underlines its intricate diplomatic balancing act, which has often prioritized safeguarding German interests, sometimes to the detriment of a comprehensive EU outlook. Given Germany’s reliance on Chinese trade and historical tendencies to align with China outside the EU framework, influencing Europe poses a challenge. Credibility must be fortified to persuade the other twenty-six of their seriousness. Moreover, China conveyed via Xinhua that Germany “can hardly hide the tone of anti-China,” and its embassy refuted competitor and systemic rival perception as “not corresponding to objective facts.”
Ultimately, significant progress will depend on skilled political leadership — an aspect that has not been a noteworthy strength of Chancellor Scholz thus far. This is evident from the recent elections and the increasing backing for the far-right party AfD, which currently holds over 20% of the vote based on recent polls, positioning as the second party.
4. Priorities and Challenges in EU-China Engagement
Three pivotal aspects elucidate the dynamics of Europe’s engagement with China. First, prioritizing individual nation-centric agreements over unified EU deliberations empowers China to exploit disparities: member states should avoid bilateralism; however, a tendency against this trend has already been observed. Second, the EU strength relies on improved internal and external synchronization: discordant strategies towards China weaken a consolidated position, affording China to engage selectively. Third, a cohesive European approach towards China presents a formidable front, thwarting China’s maneuvering to play nations competing each other.
Presently, numerous member states acknowledge the challenge posed by an assertive China. However, forging consensus on a productive collective agenda remains arduous. Two strategies could alleviate this situation: firstly, EU institutions could establish shared doctrines for engaging with China and refrain from free-riding. Secondly, given their considerable economic and political influence, Germany and France are well-positioned to assume a crucial role in effective European leadership. The moment calls for a transition from unilateral actions and capitalizing favorable Chinese ties. They are tasked with embodying EU interests and spearheading augmented intra-bloc collaboration, especially concerning China’s policies.