Regardless of Signs of a Rapprochement, EU-China Relations Face a Bleak Future

Despite signals of easing tensions, EU-China ties face dim prospects dictated by the structural impact of the growing US-China geopolitical rivalry, deep-rooted differences on political and value issues, and the rush to address reciprocal dependencies in the shadow of a potential military conflict in Asia.

This winter felt more like spring. This is not a meteorological observation and certainly not one based on weather balloon research. It is however a characterization of relations between the EU and China. 

Since November, German Chancellor Olaf Scholz and President of the European Council Charles Michel paid their first visits to Beijing in their current capacities, while French President, Emmanuel Macron, Italian Prime Minister, Giorgia Meloni, Dutch Prime Minister, Mark Rutte, and Spanish Prime Minister, Pedro Sánchez, all met with Chinese President Xi Jinping on the sidelines of the G20 Summit in Bali. Soon, President Macron is expected to undertake his own Beijing visit and other European leaders might follow, in what seems to be a year of rapprochement for EU-China relations.

This attempted détente between Europe and China has raised, in different quarters, either hopes or worries. But all these interactions will not have much of an impact on the downward trend of Europe’s relations with China, especially in the long term, because of a number of structural political factors: relations between the US and China, political and ideological differences, and Beijing’s political and geopolitical objectives.

Drifting in the Rough Seas of US-China Relations

The first factor is the state of geopolitical conflict and the continuous deterioration of US-China relations, which will impact Sino-European relations in multiple ways. To start with, as has already been the case recently with export restrictions on semiconductor manufacturing equipment, there will be cases when the US will pressure European governments to take certain harsher measures against China. While there might be some resistance the EU is likely to mostly stick with the US, even though this will not mean a perfect alignment or public recognition of such.

But Sino-American tensions will also have other consequences. For example, as the US increases pressure on China, domestic nationalism and confrontational reactions by Beijing are likely to intensify, with rippling effects likely to hit US allies as well. The EU has already felt the consequences of growing state-sponsored nationalism in China, such as when, in early 2021, some European companies faced consumer boycotts. 

The US-China conflict, combined with the reactions it will likely elicit in Beijing, will also contribute to the deterioration of China’s image overseas, Europe included, which, in turn, will either increase pressure on governments or make it easier for them to take measures that target Beijing. China’s overseas image has already suffered considerable damage over the past few years and things are unlikely to improve.

The importance of what is happening in Washington for EU-China ties can sometimes be underestimated or understated, especially as Europe likes to see the evolution of its approach to China over the past few years as mostly of its own creation. Nonetheless, it should be quite clear that in a world in which the US would still have promoted engagement with China and proclaimed that it welcomes China’s rise as good for the world, as it did until 2017, Europe would have never shifted to its current China stance. After all, the European leaders started reaching out to Beijing late last year – and spared no time doing so – only after the US pursued its own partial détente.

The European shift on China in the past few years did not just come after the US policy change but was shaped by it, not just directly, in the form of talks, briefings or pressure, but also indirectly, as Beijing’s aggressive internal policies and external behavior and the threat that it poses to the West became much more discussed issues after 2017, changing public and elite perceptions. All this will continue as US-China relations are increasingly driven by the narrative of rivalry.

Many European leaders seem unwilling to accept this reality, repeatedly saying they want the world to avoid ‘division into blocs’ and a ‘new Cold War.’ However, the world is already in this state, and in an international system that is closer to bipolarity than multipolarity, the EU lacks the capacity, or even the will, to act as a global great power that could affect these structural developments. For example, the EU does not even try to shape the US government’s China policy the way Washington aims to shape the European China policy. In this context, it is the US that leads and the EU which has to, eventually, follow.

Relations between Washington and Beijing and their state of conflict will continue to shape both the international environment and the EU’s approach toward China, directly and indirectly. In the meantime, as long as European leaders do not accept that their call for avoiding a ‘new Cold War’ might be a noble wish but has already failed, it will be difficult for them to design a coherent China strategy.

Ideology at the Core

The second factor that will make it almost impossible for the EU and China to significantly improve their relations concerns their ideological and political differences, on issues ranging from human rights to general political distrust. 

The fate of the EU-China Comprehensive Agreement on Investment (CAI) is a case in point, as political differences had a real economic impact. Beijing would want European stakeholders, particularly political leaders but also civil society, to abstain from any criticism of its internal or external politics. However, this will never happen – on the contrary, the attention paid to China and thus the criticism of its government and leadership is only set to increase. 

Conversely, Europe might want Beijing to provide freedom and democracy to the Chinese people or, at least, refrain from human rights abuses, but unfortunately, that is also not a prospect on the horizon. In this context, tensions are unavoidable, while managing them will be difficult, because of a lack of political trust, political commitment to sustained engagement, and willingness to make any substantial concessions toward the other side. Just as in Europe, where taking seemingly pro-China positions is frowned upon, the political environment in China, marked by growing nationalism, makes it almost impossible to take steps necessary to defuse tensions – for example, to accept some foreign criticism on human rights without affecting political trust or bilateral relations.

One important source of tensions is the behavior of European non-governmental stakeholders or even individual EU member state governments, whose criticism of China and its various actions will lead to retaliation from Beijing or, at least, a diminishing of trust. In many cases, even when it was the actors not connected to the central government who engaged in criticism of China, Beijing struck back, raising questions if it even understands how democracy and the separation of powers work. In turn, such retaliation affects political and economic trust and sometimes leads to European countermeasures as well. These will become even more robust once the EU approves the Anti-Coercion Instrument (ACI), which will institutionalize the imposition of economic countermeasures.

However, regardless of European hopes, it is unlikely that the ACI will stop Beijing from engaging in its tradition of using economic weapons against foreign political actions it perceives as inimical. Thus, ties between the two sides will become even more vulnerable to wide disruption from local, episodic tensions. 

Technically speaking, this mechanism of bilateral sanctions and Beijing’s penchant for employing ‘sticks,’ could even be used by some actors to intentionally affect relations with China, guided by the idea that if there is no will on the EU side to economically distance itself from China, Beijing can be counted on to do that – as it did with the CAI. 

Such a strategy has not yet been adopted, but the past has shown that the actions of a single European government can generate widespread economic tensions. Judging by Beijing’s behavior, even critical comments from European politicians, especially the ones in government, could also have an impact. And, as ideological and political differences will remain prominent, such episodes are likely to repeat themselves. 

War and Other Dangers

Finally, Beijing’s political and foreign policy objectives, especially its territorial claims, will also affect relations with the EU, either directly or by prompting preemptive moves on the other side – such as the European attempts to reduce economic dependency on China already under way. The nationalistic mindset of the party leadership and Beijing’s territorial claims will slowly boil tensions over the coming years, until they might finally explode, should the leadership act on them. 

If the main source of headaches for EU-China relations was unfair subsidies, uneven market access, cybersecurity, or even human rights and the preservation of the liberal world order, there might have been solutions or at least ways to compartmentalize the problems. But Beijing has numerous territorial claims that it is highly unlikely to abandon, even if China achieves global leadership in other measures of power. Thus, the main problem is the mindset of the party leadership and its territorial claims, which could lead to a complete unraveling of EU-China relations in case of an invasion of Taiwan or another military conflict in the region, even if the EU has no permanent military presence there, nor does it have defense treaties with regional countries.  

Even absent a hot war in the region the mere realization of this threat will drive tensions and an economic and political distancing in the coming years, as Europe will intensify its efforts to preemptively reduce dependencies on China.

On top of that, driven by a desire to deter any aggressive actions from Beijing, it is likely that together with the US and other allies, European countries will also start articulating what might be the consequences of aggressive Chinese military actions – which will in turn not go unanswered by Beijing. In the meantime, China is also interested in reducing dependencies on the US and its allies, Europe included. What emerges is a vicious cycle, which will only lead to the intensification of tensions.

All these major factors influencing the future trajectory of EU-China relations are beyond the control of European leaders. They could put up more resistance against the US attempts to build a united front, try to minimize ideological and political differences and their consequences, or ignore, for the moment, the threat of war. However, these developments of a structural nature will still inevitably affect ties, especially in the long term, the current efforts at a détente notwithstanding.