The European Union's New Rival - China

Abstract

The European Union-China relationship, based on an optimistic joint strategic agenda agreed in 2013, has shifted direction, with the EU in March 2019 describing China as a "systemic rival" in some areas. The EU has struggled to find a common approach to China, but this change was agreed at record speed and occurred against the background of growing United States pressure on its European allies to support the Donald Trump administration's hard-line approach to China. As the new EU leadership team takes over, it will have to navigate a difficult path in relations with China and the US. The main reason for the shift in the EU's approach was business frustration at China's failure over many years to implement promises to open up its economy and accept a level playing field. Chinese foot-dragging in the negotiations for a bilateral investment agreement, now running for over six years, was another factor in the changed EU approach. A number of key players, including commissioners dealing with China, members of the European Parliament, and EU ambassadors who had served in Beijing, played a key role in securing this changed approach, which was agreed very quickly despite some long-standing divisions between member states on how to deal with China. Pressure from the Trump administration - which, unlike the EU, views China as a "strategic rival" - also played a part. It is likely that the new EU leadership under Ursula von der Leyen will maintain the tougher line, and place greater emphasis on reciprocity and strategic autonomy as guidelines for dealing with China. Meanwhile there is continuing useful cooperation between the EU and China on the foreign policy front, notably on Iran, and on global issues such as climate change and support for the multilateral trading system. The EU has to invest more in understanding China, which is a growing and formidable rival. EU leaders need to spend more time discussing China and agreeing a comprehensive approach covering all sectors. It should work with like-minded partners where there are shared interests concerning China.