US-China relationship marginalises Europe

When the Chinese premier Wen Jiabao travelled to Prague last May to address the EU-China trade summit, he spoke of the need for China and Europe to “strengthen confidence, deepen co-operation and continue to forge ahead hand in hand”.

Unfortunately Mr Wen’s diplomatic niceties could not mask the reality that Europe’s relations with China have deteriorated markedly over the past five years, with worrying consequences for Europe’s ability to project and defend its collective interests on the world stage.

Already strained by a mounting trade deficit, by the 2005 “bra wars”, in which millions of Chinese textile products were blocked at EU ports, and by human rights issues, the relationship reached its nadir last December when China cancelled the previous EU-China summit in protest at the French president Nicolas Sarkozy’s decision to meet the Dalai Lama.

The Chinese action, as a recent European Council for Foreign Affairs paper on relations with China observed, displayed the “diplomatic contempt” with which China now treats the EU, notwithstanding its status as China’s single largest trading partner.

As recently as 2003, when China released its first policy paper on Europe, the Chinese state media was talking of a “honeymoon” period with Europe, but over the past six years the hoped-for marriage of mutual interests has soured into destructive rounds of squabbling and recrimination.

Analysts point to several key events in the fraying of relations, starting in 2005 when Europe looked set to lift an arms embargo imposed after the 1989 Tiananmen Square massacre and then back-tracked at the 11th hour under pressure from the US.

The incident rankled deeply with Beijing and damaged Europe’s credibility with China, says Professor Feng Zhongping, head of the European section of the China Institute of Contemporary International Relations and a highly influential Chinese analyst on European affairs.

The row over the arms embargo also coincided with rising anti-China sentiment among Europe’s public and parliaments, fuelled by the flood of cheap imports and Chinese protectionism which created a trade deficit with China that Peter Mandelson, then trade commissioner, famously calculated was rising at “15 million euros an hour”.

In October 2006 discontent with China took on official form when the European Commission published an official “Communication” that included 21 demands for China to open its markets, improve human rights and become a responsible actor in world affairs.

“The Communication deeply antagonised Beijing,” says Professor David Shambaugh, director of the China Policy Programme at George Washington University, “and since then it’s fair to say that the atmosphere between China and Europe has not been good.”

The result, from a Chinese perspective, has been to view Europe as an increasingly divided and enfeebled entity, unable to negotiate with one voice and rapidly being overshadowed by a burgeoning US-China relationship. “Europe is obviously the original model of co-operation and has played a very important role since World War Two in world affairs, but Europe is in comparative decline now and on many key issues you can’t hear Europeans really contributing,” says Professor Feng.

“On many issues Europe only talks, but does not take much action. It’s not the EU’s fault because European soft power only goes so far. Europe is not its own country. It doesn’t have a military, a foreign policy or a president, and even if it did, it would not be the same as an American president. To say 'let’s work with Europe’ is really an empty slogan.’”

Faced with a divided Europe, China has in recent years focused its dealings on country-to-country negotiations, setting up a strategic economic dialogue with the UK, a status that France and Germany are also now seeking.

“Brussels is losing importance: we must go back to the capitals, who make the decisions, speak to member states, even on trade,” says Professor Feng.

Unfortunately, argue supporters of a more coherent engagement of China by Europe, the effect has been to weaken Europe’s collective ability to win concessions, whether on human rights or the perennial irritant of Chinese protectionism.

“Weakness at the European level allows the Chinese to pick off member states one by one,” says Professor Shambaugh, “To borrow the Chinese phrase 'yi yi zhi yi’, it’s a case of 'let the barbarians rule the barbarians’, or as the British say, 'divide and rule’.”

Division has also weakened attempts to get China to conform on human rights, an issue that provokes irritation and cynicism in Beijing, which sees European countries using the issue as a stick with which, selectively, to beat China. “Why was human rights not an issue for Chirac or Schroeder, but now for Merkel and Sarkozy it is?” asks Professor Feng, “One day Europe will realise that the Chinese human rights issue is improving every day and only China can improve the issue. The EU can’t help much in this.”

Despite all the official-level engagement – some 450 delegations visit China every year – the failure to win significant concessions is provoking an intense debate in the think tanks and chancelleries of Europe on how to revitalise the relationship. Supporters of the Lisbon Treaty argue that the creation of a European president and “High Representative” for foreign affairs are essential if Europe is to avoid being further marginalised by the US-China relationship.

The hope is to replace talk of a “G2” – America and China – with a “G3” in which Europe becomes a vital third-party in the shaping of a new, multi-polar world.

More hardline voices, who also support ratifying Lisbon, are calling for Europe to get tougher with the Chinese, adopting a policy of reciprocal – as opposed to unconditional – engagement, which would see Europe withholding access to markets and officials until China gave ground on fundamental issues.

Other suggestions include the creation of a European bond market to spur Chinese investment in Europe and the creation of a strategic policy framework to help Europe decide on how to manage the political implications of much-needed investment in Europe by the Chinese state and state-run enterprises.

Equally as important, say many analysts, will be massive Europe-wide investment in Chinese studies to make up for the EU’s comparative dearth of China expertise and language skills, which is seriously hampering the Commission’s ability to deal effectively with China.

But none of these suggestions can overcome the fundamental weakness in the EU-China relationship which was characterised by one think tank as a game of chess, with China on one side and 27 opponents on the other, all crowding the board and squabbling about which piece to move.