- The EU, the UK and several European countries have strategies or policies to deal with China. But China’s rise, its support for Russia’s war effort in Ukraine and the unreliability of Trump’s US as an economic and security partner have sharpened the dilemmas in European policy towards China.
- Trade between China and the EU and UK combined amounts to more than one-third of total global trade. The balance is heavily in China’s favour, and its surplus is widening. Repeated EU and UK expressions of concern have achieved nothing. The problem for Europe is not just the size of its trade deficit, but the wide range of critical goods for which it is largely or entirely dependent on China. China’s industrial over-production is driving European producers out of their domestic markets and their export markets.
- In technology, China has moved from being an imitator to an innovator, and leads Europe in many areas seen as critical to future economic growth and achieving net zero. Through the policy of ‘military-civil fusion’, Xi Jinping is seeking to ensure that the military sector can benefit from civilian technological advances. Allowing China to acquire defence-related knowledge in Europe is worrying because China is helping Russia in its war of aggression against Ukraine, and because it threatens Europe’s democratic partners in the Indo-Pacific region. China is also using the influence it derives from its trade and investment to promote its model of techno-authoritarianism, with some success in the global south and even in Europe
- Europe has to manage its approach to China’s geopolitical challenge in the context of an erratic US administration that is sometimes tough on China but sometimes undercuts its own restrictions on technology transfer, and may intend to pull back from providing security for its European and Indo-Pacific partners.
- European ‘strategies’ for dealing with China and the Indo-Pacific region are vague about ends and even vaguer about means. Europeans want to maintain as good relations as possible with China, while mitigating the risks that it poses. They do not want to discuss what it means for China to be a systemic rival, or how to promote European models of governance against China’s alternative.
- Europeans would benefit from having co-ordinated policies towards China. The starting point should be an improved understanding of what China is doing. European governments should stop thinking that Xi Jinping will eventually level the playing field or open his markets to European competition.
- Both the EU and UK would benefit from regular and intensive dialogue and practical policy co-ordination in relation to China. There are a wide range of topics that could be included in the agenda, including economic security, the protection of sensitive technologies, Chinese cultural and information activities in Europe, and Europe’s broader geopolitical approach to China and the Indo-Pacific region.
- Engagement with China in some areas, such as combatting climate change, is desirable and necessary, but Europeans should not be naïve. The UK and EU both shy away from labelling China as a hostile state, still less an enemy. But China has built up its power with a view to pursuing ends that will in many cases not be aligned with European values or interests.
- The EU is right to say that China is a systemic rival. The UK says that “the challenge of competition from China has potentially huge consequences for the lives of British citizens” and speaks of the need for alignment with G7 and other partners. But neither the EU nor the UK have drawn the policy consequences from their analysis. Europeans must now work to ensure that the European liberal, democratic model of governance shows its superiority to the authoritarian model promoted by Xi Jinping.
About the author:
Ian Bond has been the deputy director of the Centre for European Reform since November 2023. He joined the CER as foreign policy director in April 2013. Prior to that, he was a member of the British diplomatic service for 28 years.