China-EU relations: Can the EU have its cake and eat it too?

SCMP Newsletter

The European Union (EU) needs China, given their close economic ties. And China needs the EU, particularly given the sharp escalation of tensions between Beijing and Washington.

But ties are starting to fray given recognition in most European capitals that China’s economic model is not compatible with theirs, that there are security risks from China’s increasingly assertive global outreach, and that China does not place the same value on human rights as they do.

China and the EU have been trying to negotiate a treaty governing bilateral investment for more than seven years, to no avail so far. The EU is increasingly frustrated that promises by Beijing to create a level playing field for foreign firms in China have not been met, so Brussels could restrict Chinese access to the single market if there is no progress by year-end. China made new promises in the last round of negotiations, but is still far from meeting EU demands.

Despite initial resistance to the US-led initiative to ban China’s Huawei Technologies Co. from supplying critical equipment to 5G telecommunications networks on national security grounds, major European nations have gradually come around. Germany, France, and a number of other EU states eventually followed EU recommendations that they avoid “high risk” suppliers for their 5G networks.

Now add human rights issues to this potent policy mix: first alleged Chinese human rights abuses of the Uygur minority in Xinjiang province and then the new National Security Law imposed by Beijing on Hong Kong. European leaders are voicing their criticisms of China, leading the EU to call out China at the United Nations in late September. This came 10 days after new EU Commission President Ursula von der Leyen slammed China’s human rights record and business practices in her maiden state of the union address and introduced a new plan to sanction countries for their human rights abuses. China’s diplomatic mission to win over European leaders did little to change the growing mood of distrust.

Germany – the EU’s largest economy – has been at the centre of the debate on the changing relationship with China. While Chancellor Angela Merkel has tried to steer a middle course, ministers in her coalition government have spoken out strongly on the need to curtail China’s influence in Europe. While Germany’s world-famous auto industry depends heavily on sales in the Chinese market, Merkel is now urging her countrymen to look to other Asian countries to sell their products.

One problem is that the 27 members of the EU are not united in their stance on relations with China. Fully 17 eastern and central European countries formed a special group to promote relations with China, the so-called 17+1. China is supporting the group with large investments in member countries, particularly those at the end of its Belt and Road rail and sea trade routes, even Nato allies like Greece, much to the consternation of the US. Those nations, in turn, have backed Beijing on sensitive issues like human rights, causing Brussels to charge that China is trying to “divide and rule” Europe through the initiative.

The election of Joe Biden as US president may result in a new united front with Europe to confront China. For their part, European leaders are ready to work with the new US administration on China issues.

60 SECOND CATCH-UP

EU-China ties hinge on Germany’s political future as reign of Beijing ally Angela Merkel nears its end

EU leaders talk tough to Beijing over long list of unmet promises

Multimedia: Belt and Road Initiative: Plugging China into Europe

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