Their concern over an increasingly erratic US foreign policy is bringing the EU and China closer together. Yet last weeks’ EU-China Summit also illustrated that this partnership remains limited to selected issues.
Expectations were unusually high for this year’s EU-China Summit. After US President Donald Trump had alienated European leaders at the G7 meeting in Italy, Germany’s Chancellor Angela Merkel had called on Europeans to ‘take our fate into our own hands.’ Her statement was widely interpreted as signaling a strategic realignment. Germany and the EU were seen as shifting further away from the United States – and closer into the outstretched arms of a globally more active China.
Last week’s summit showed that this is certainly the case on certain global issues. Europe and China were able to find some common ground on issues such as climate change, but frictions in other areas remain far from resolved. However, the summit also showed that joint opposition against Trump’s policies can only carry the relationship so far.
Trump pushes the EU and China closer together
With a strong commitment to climate action, the EU-China Summit sent a clear signal to Washington: Europe and China are willing to work together and take the lead on issues of global governance from which the US is currently withdrawing.
Europe and China reiterated their intention to implement the 2015 Paris Agreement and to foster cooperation on energy policy. They also signed a Memorandum of Understanding between the European Investment Fund and China’s Silk Road Fund that will provide European SMEs with 500 million EUR. These two summit results suggest progress on critical issues, and it seems highly likely that closer European-Chinese cooperation in other areas will evolve in light of the US administration’s erratic course on foreign policy.
Crucial differences on trade, investment, and human rights
However, the summit also showed that Europe and China have a long way to go to improve their relations, which were recently tested by disputes over investment and trade as well as by foreign policy disagreements, e.g. over China’s posture in the South China Sea.
Critically, a joint statement on combating climate change, which had been in the making for eight months, fell through due to China’s insistence on a reference that would have bound the EU to eventually grant it Market Economy Status (MES). Similarly, the lack of reciprocity in the investment relationship, which makes it hard for European companies to access and operate in the Chinese market, remains unresolved. While China’s leaders present their country as a champion of globalization and a reliable partner (Xi’s speech at the World Economic Forum in Davos being a case in point), China still has to follow up on its rhetoric.
Apart from trade and investment, differences between Europe and China remain in other areas. On connectivity, the EU and China disagree on standards for infrastructure projects, which would be needed in order to align China’s Belt and Road Initiative with Europe’s infrastructure plans. On the human rights front, the EU is concerned about the overall decline of personal freedoms in China. As for security cooperation, the EU would like to see greater Chinese involvement in addressing migration and other challenges in Africa and the Middle East.
A more confident European Union
Last week’s summit also marked a further toughening of Europe’s tone on Chinese industrial overcapacities, when EU leaders explained to Chinese Premier Li Keqiang that a planned modification of the EU’s trade defense instruments would help to ensure that economic relations with China bring benefits for all. “Here in the European Union we are focusing minds and efforts on making sure that no one is left behind and that we are all playing by the same rules,” European Commission President Jean-Claude Juncker said in his summit speech.
The EU – along with the United States – accuses China of dumping its excess steel production on the international market by providing export subsidies and other incentives to domestic producers. In light of widespread public discontent with globalization, European leaders have become increasingly outspoken on this issue in recent months.
Overall, this year’s EU-China Summit can be seen as a first indicator of Europe’s intention to increase its strategic autonomy. Trump’s unpredictability has reinforced European endeavors to be more strategic about selecting its partners, a goal that also figures prominently in the EU’s Global Strategy. Forging closer ties with Beijing on climate issues seems a sensible step towards this end. Yet at the same time, it became clear that the partnership with China will remain a selective rather than a comprehensive one.