Ciaran Cadden graduated from University of Manchester in PPE, and works as a business development consultant in Taipei.
Xi Jinping is on his first tour of Europe in five years in a visit. The visit of China’s President is likely to be dominated by events in the Middle East and the brutal, grinding conflict on Europe’s eastern frontier. But for the continent’s movers and shakers, the visit will also be a chance for those in Paris, Berlin, and Brussels to attempt to reset European-Chinese relations economically. But is everyone singing from the same hymn sheet?
Xi was welcomed in Paris by Emmanuel Macron by a state ceremony, followed by a trip to the Pyrenees where Ursula von der Leyen sought to move mountains to reset Sino-European relations fractured by Beijing’s tacit support of Russia, and China’s dumping of electric vehicles and raw materials into the European market.
Macron and von der Leyen evoked a tough, no-nonsense approach to talks while at the same time attempting to distance themselves from Washington’s “de-coupling” policies toward Beijing. They painted Europe as a player China can work with, whilst simultaneously “de-risking” themselves from it. The sense of confusion is palpable.
Yet this ‘Third Way’, as Macron promotes, has no doubt been undone after Xi visited Serbia and Hungary, two nations that have cosied up to China in recent years, with the latter being a key partner in China’s flagship Belt and Road Initiative, and the former, though not a member of the EU, receiving eye-watering amounts of Chinese investment.
Xi no doubt treats any talk of beefing up the European economy against Chinese action as nothing more than a paper tiger. He knows he has allies across Europe who can take down any action deemed hostile to the Middle Kingdom.
Although a key objective from European leaders has been to influence Xi to put pressure on Putin his war in Ukraine, the real objective will be to address what von der Leyen has dubbed “market-distorting practices” from China, and instead call for competition that is “fair and not distorted”.
For years, China’s oversupply of raw materials such as steel, and finished goods such as electric vehicles (EVs), created by a weakened domestic demand in China, has sent alarm bells ringing across Europe. The oversupply of EVs has caused fury among Europe’s carmakers who are demanding protection from the dumping of Chinese EVs, with companies such as Volkswagen and Renault losing ground to Chinese firms year after year.
If Europe is serious about its 2035 mandate to ban ICE vehicles from being sold, it ought to start being putting its own companies first, rather than finger-wagging at Beijing. If Macron thinks he has found an opportunity to out-maneuver the US and offer a ‘Third Way’ to Beijing, he ought to be careful it doesn’t come at the expense of the European car industry who are competing for in the uncertain world of Net Zero.
The Europeans would do well to learn from the Americans. The topic of China has united both Republicans and Democrats; tariffs on steel and raw materials and the banning of TikTok have been two keynote policies largely agreed to on by both sides of the aisle in Congress. Being firm and united in an approach, and setting boundaries with a nation as important as China is the best way of sending a message: “Yes, we will trade with you, but it won’t come at the expense of our own industry no matter how low you price an EV through mass production”.
A “de-risking” strategy isn’t de-risking much at all if at the same time as some European nations openly embracing Chinese money and influence. It isn’t a coherent strategy and is one that ought to end now. The real position of strength would be to keep trading with China but with a wider goal of protecting key industries, especially green technology, which won’t leave Europe at the behest of Beijing.
As no longer a member of the EU or Single Market, we in the United Kingdom ought to position ourselves largely in line with our cousins across the Atlantic and take a firmer line on relations with China. The recent cyber attack on the Ministry of Defence by (we perceive to be) China is the latest alarm bell that ought to justify caution and smart politics when dealing with a competitor in the form of China.
Many wish to pretend the Chinese threat is non-existent and focus solely on cheap goods, getting the Chinese onside for climate change reasons, and coaxing Russia into backing down in Ukraine. But as someone who speaks Mandarin, has lived roughly 100 miles off the Chinese coast in Taiwan for many years, and who genuinely wishes for cordial relations, I don’t believe being naive to the threat is the best course of action.
Instead, the United Kingdom should lead by example and understand that multi-polarity is the reality. We must be distinct in our values and clear who we wish to share intelligence with. Continuing with AUKUS, Five Eyes, and protecting our industry from overt Chinese influence ought to be obvious platforms we should proceed with.
What would be disastrous would be to follow the misguided approach dreamt up in Brussels and offer a half-baked Sino policy which will come apart when faced with the faintest of pressure.
