Written by 5:04 pm EU Investment

Europe turns on China

Once skeptical of America’s increasingly hostile stance toward China, the EU and its member states are adopting a cascade of new measures that bring their policies closer in line with those of the United States.

Why it matters: Beijing’s push for Europe to adopt “strategic autonomy” from the United States — in the hope the EU would maintain warmer ties with China — now looks like a moot point.

What’s happening: Last week, the European Commission unveiled a proposed ban on products made with forced labor, after intense pressure from lawmakers and human rights activists concerned about forced labor in Xinjiang.

  • European Commission President Ursula von der Leyen also criticized Chinese funding of European research institutions and announced a new “Defense of Democracy” package intended to scrutinize foreign funding of European academic institutions in order to “bring covert foreign influence and shady funding to light.”
  • The U.S. implemented an import ban on all products made in Xinjiang earlier this year, and the Trump administration placed greater scrutiny on foreign funding in U.S. universities.

Zoom in: Germany is a key benchmark. Berlin was once a stalwart supporter of close trade ties with China, and thus it tended to avoid tension with Beijing. But Berlin now seems to have turned a major corner on issues from trade to human rights to direct military engagement in the Indo-Pacific.

  • Last week, Germany’s Economy Minister Robert Habeck pledged “no more naivety” in Germany’s trade with China. Habeck announced his team was working on a new economic policy to reduce dependence on China across key industries and closely scrutinize inbound investment from China, saying, “We cannot allow ourselves to be blackmailed.”
  • The German Foreign Ministry also announced it was appointing a special representative to Pacific nations, where China’s expanding influence has alarmed Australia and the United States.
  • In late August, Germany joined Exercise Pitch Black as a full participant for the first time. The set of military drills is held every other year off Australia’s northern coast with air forces from as many as 17 countries, including the U.S., the U.K., France, Singapore, Malaysia, Indonesia and Thailand. The exercise’s recent expansion has prompted questions about its potential role as a counter to China in the region.
  • The Chinese Communist Party-affiliated tabloid Global Times reported that some German media warned the country against joining an “anti-China alliance” in the Indo-Pacific.

Flashback: European nations were largely skeptical of the Trump administration’s sharp rhetoric against China.

  • In December 2020, the European Union agreed to an investment deal with China that ignored concerns about forced labor in China’s economy and would have strengthened economic ties between the bloc and China. That same year, by contrast, the Trump administration took more than 200 public actions to push back against Beijing and delink certain sectors of the U.S. and Chinese economies.

  • But a major turning point in the EU-China relationship occurred in March 2021. The EU levied sanctions on some Chinese officials for abuses in Xinjiang. Beijing retaliated by sanctioning EU members of parliament and others, and in May 2021, the European Parliament voted to freeze the investment deal.

The Europe-China relationship has plummeted since then.

  • China’s “rock solid” support for Russia during its invasion of Ukraine soured the attitude of many Europeans toward Beijing.
  • Beijing’s ongoing crackdown on Hong Kong has also stunned many in Europe.
  • A United Nations report published in late August warning of “serious human rights violations” and possible “crimes against humanity” in Xinjiang sparked harsh criticism from European leaders.

Yes, but: Trade ties between Europe and China are still strong, and the EU has emphasized that cooperation on climate change with China is crucial.

What to watch: Taipei is urging the EU to adopt sanctions that would deter China from invading Taiwan, Reuters reports.

  • China, meanwhile, is forging economic and security relationships at Europe’s periphery. Xi and Belarus President Aleksandr Lukashenko just announced an upgraded partnership, and Hungary’s Viktor Orbán has deepened ties with China.

Go deeper: France navigates tricky China challenges

Source link

Close