Is Europe Ready to Work With the United States on China?

by Judy Dempsey*

NOAH BARKIN/ MANAGING EDITOR AT RHODIUM GROUP

It depends which Europe we are talking about. It was positive to see the European Commission publish a blueprint for transatlantic cooperation which touched on many issues related to China. But would that document receive an unqualified endorsement from Berlin and Paris, let alone from Budapest and Athens? That’s not entirely clear.

What we do have in European capitals is a readiness to sit down at the table with the incoming administration of U.S. President-elect Joe Biden to discuss China. Beijing’s image has taken a serious hit in Europe due to its aggressive coronavirus pandemic diplomacy, its crackdown in Hong Kong, its repression in Xinjiang, and its recent trade war with Australia.

There is a recognition on both sides of the Atlantic that only through common action is there any hope of influencing China. This provides reason for optimism.

But Europe still needs to show that it is willing to go beyond words and defensive measures when dealing with China. German leadership will be essential in this regard. Berlin’s new Indo-Pacific guidelines are a positive sign. But its strategic ambiguity on Chinese 5G networks is worrying. The true potential for EU-U.S. cooperation on China may only become clear when Angela Merkel’s successor is sitting in the German chancellery.

JENS BASTIAN/ SENIOR POLICY ADVISOR AT THE HELLENIC FOUNDATION FOR EUROPEAN AND FOREIGN POLICY

Various European countries have expressed a willingness to work with the incoming Biden administration on forging common policy approaches toward China.

But this political will does not immediately translate into capacity for transatlantic cooperation. The fault lines emerging during the past four years are deep. Moreover, the economic consequences of the coronavirus pandemic will continue to shape the diversity of European countries’ relations with the United States and China in 2021.

A key parameter defining transatlantic cooperation on China concerns the departure of Merkel from office following the general elections in Germany in autumn 2021. The emerging debates inside Germany on how to forge a post-Merkel strategy toward China are a challenging test case for the country’s credibility on the European stage and for transatlantic cooperation.

A further imponderable concerns existing divisions among EU member states on how to approach China. These divisions were highlighted by China’s so-called mask diplomacy during the pandemic and continue as regards the debate over conditions for including Huawei in European 5G networks. Trade, investment, and debt exposure to China set institutional limits for European countries’ readiness for transatlantic cooperation.

KRZYSZTOF BLEDOWSKI/ SENIOR COUNCIL DIRECTOR AND ECONOMIST AT THE MANUFACTURERS ALLIANCE FOR PRODUCTIVITY AND INNOVATION

No, Europe is not ready.

China is a predatory regime, whose global ambition is—at best—to “Finlandize” weaker countries and—at worst—subjugate them as future tributary territories. Yet many European governments, including Hungary, Italy, Portugal, and Serbia, see the trees where the United States perceives the forest. Trading short-term commercial advantage for long-term sovereignty erosion, these countries shortsightedly abet the enemy.

Having outsourced military security to the United States, Europe feels that it can have a cake and eat it; monetize temporary business gains while externalizing public defense costs. Yet this will not stand.

Neither the Biden administration nor the American public are ready to continue subsidizing European security without a joint containment of China. Europe has little time to start treating China as an existential threat, much as it did the Soviet Union or Nazi Germany.

There is a conundrum, however, and it has two dimensions. First, the Europeans remain in denial about their share of responsibility for military threats. Rose-tinted views of Russia and China don’t help where intra-European divisions persist. And second, the EU is not equipped to act strategically. The sum of French, Polish, or Italian national interests doesn’t add up to the raison d’etat of the EU.

LIZZA BOMASSI/ DEPUTY DIRECTOR OF CARNEGIE EUROPE

Yes, absolutely. And in many ways, it will be easier to do so under the new, incoming U.S. administration. At the same time, there will also be a greater expectation that a less acrimonious transatlantic relationship will result in stronger transatlantic convergence.

Some areas—like climate change mitigation, trade policy, and global governance—will be easier for the United States and Europe to work together on. Transatlantic interests are so aligned in these spheres that it is only really by lockstepping efforts that headway can be made in managing the relationship with China.

But in other areas like technology and defense policy, despite converging interests, it will be more difficult.

This is partly because policy approach in these two areas has historically and increasingly diverged, and China will continue to leverage these divergences to its advantage.

The bottom line is that it will be difficult to have full transatlantic unity on all issues as they relate to China. Yet full unity is not a prerequisite if there is agreement on the fundamentals. Invariably, some approaches will converge, others will diverge. The key is to match expectations and means with a sober analysis of the facts and realities on the ground.

ERIK BRATTBERG/ DIRECTOR OF THE EUROPE PROGRAM AND FELLOW AT THE CARNEGIE ENDOWMENT FOR INTERNATIONAL PEACE

European leaders have made clear they strongly desire to work with Biden on China as part of a “new transatlantic agenda.”

The Biden team, too, has big expectations for engaging Europe on the China file early on. But the prospects for a robust dialogue with Washington on China ultimately depend on the EU’s ability to formulate a coherent China strategy of its own. Here, the EU has made progress in recent years, but it must do more to firmly push back against China’s growing international assertiveness, which has become even more brazen during the pandemic.

While it has been relatively convenient for EU leaders to dismiss U.S. President Donald Trump’s tough demands on China because of his administration’s unilateral approach, an ambitious and multilateral-minded Biden administration keen on building coalitions of like-minded partners to jointly confront China may present an opposite dilemma for the EU.

In this new context, the notion of a European third way seems increasingly misplaced. Instead, the EU should demonstrate that, on China, it can be a meaningful partner to the Biden administration—including on tricky issues like 5G, reforms of multilateralism, and human rights in Xinjiang and Hong Kong—who in turn should embrace the notion of European sovereignty.

REINHARD BUTIKOFER/ MEMBER OF THE EUROPEAN PARLIAMENT

My first impulse is to reject the question of whether the EU is ready to cooperate with the United States on China—our partner, competitor, and rival. Haven’t we—as multilateralists—been visibly craving for such cooperation, as that follows naturally from our partnership?

Didn’t the EU’s high representative for foreign and security policy, Josep Borrell, initiate a transatlantic dialogue with the United States on China this summer, of which the first occurrence will happen before Christmas?

Haven’t we asked the U.S. government to work with us in reforming the World Health Organization (WHO) and the World Trade Organization (WTO) from within to deal more adequately with China?

Can there be any doubt that Europe would gladly welcome newly minted climate collaboration with the incoming administration to help push China toward real ambition and toward delivering on its promises?

Yes. But.

On the one hand, Europe—while showing growing unity vis-a-vis China as regards threat and risk analysis—still wavers in choosing the right trajectory for its China strategy. How do you cooperate and compete with a systemic rival?

On the other hand, Europe does not fully trust the United States. The Trump shock will not dissipate just like that. So, maybe we’re not fully ready. But that’s irrelevant. We cannot wait until everything pans out. Cooperate on China we must. Now.

ALLISON CARRAGHER/ VISITING SCHOLAR AT CARNEGIE EUROPE

The United States under Trump hawkishly embraced a new era of great-power competition with China. While Biden’s administration will certainly craft its own China policy, it will likely differ more on style than substance.

The EU over the past two years has slowly but surely adopted the substance of this U.S. policy. In March 2019, the EU reached consensus to label China an “economic competitor” and “systemic rival.” EU-wide economic initiatives like the creation of a 5G toolbox and implementation of an investment screening mechanism are clearly intended to counter this competition—even in instances when the EU hesitates to call out China directly.

While many Europeans eschew Trump’s confrontational style, U.S. and EU policy convergence has none the less succeeded because this policy reflects both American and EU core interests. Member states maintain unique attitudes toward China, but they are largely united in their quest for economic security and commitment to so-called Western values. The current Chinese government consistently undermines both these aims.

Europe is ready to work with any partner that shares these interests. The United States should be at the top of its list.

MARTA DASSU/ SENIOR DIRECTOR OF EUROPEAN AFFAIRS AT THE ASPEN INSTITUTE

Yes, in principle, Europe is ready. Or to put it better, common institutions are.

Let’s look at the new EU-U.S. “agenda for global change” issued by Brussels on December 2. The proposal includes setting up a new EU-U.S. dialogue on China to protect common interests and manage the differences that remain. Which differences?

The EU has already recognized China as a “systemic rival.” And yet, as compared to the United States, European governments are much less confrontational vis-a-vis the second-largest economy in the world.

The U.S. approach to China is security first; the European one is economy first. For the EU, the China challenge must be managed through a long and concerted effort within a renewed multilateral framework, starting with the reform of the WTO.

The incoming Biden administration will also ask for more rapid and tangible results, first of all on technology control. That will affect European economic interests—German interests in particular—in the relationship with China.

In the end, the key question becomes “is Europe ready to pay the price of a transatlantic dialogue on China?” And that’s not granted.

ALICE EKMAN/ SENIOR ANALYST AT THE EUROPEAN UNION INSTITUTE FOR SECURITY STUDIES

Yes, this was already the case under the Trump administration—for instance with the launch of an EU-U.S. dialogue on China, still to be consolidated—and it will be even more so following the election of Joe Biden, welcome in many European capitals.

But for a more effective transatlantic cooperation on China, some adjustments will be needed in the coming months in four areas:

-Assessing the efficiency and concrete outcomes of the approaches adopted by both sides so far toward China—including sanctions, negotiations, and more.
-Identifying ways to cooperate more substantially at the multilateral level along with other partners—acknowledging that China is not isolated and is also building coalitions—including on Hong Kong and Xinjiang.
-Addressing the technological challenges in a broader “ecosystem” perspective (not only focusing on 5G), with a comprehensive assessment of China’s technological and innovation capabilities and competitiveness in third countries.
-Consolidating transatlantic cooperation on coronavirus recovery as well as on joint assistance to third countries in a context of emerging competition between pandemic-assistance strategies where China plays an active role, for example in providing masks, vaccines, and technological devices.

In any case, this is no time to “educate Europe on the China challenge,” as it has sometimes been heard in Washington, or to repeat that divergences among member states is the main obstacle to further transatlantic cooperation on China. Much can be done already by addressing the shared objectives above.

MARIO ESTEBAN/ SENIOR ANALYST AT THE ELCANO ROYAL INSTITUTE

The new EU-U.S. agenda for global change issued by the European Commission shows that Europe is ready to cooperate with the incoming Biden administration on a more coordinated China policy.

Despite some discrepancies among EU member states and between the EU and the United States on both their interests and strategies vis-a-vis China—some are more willing than others to prioritize economic links at the expense of geostrategic and normative issues in their relations with Beijing—Biden shares more common ground with the EU on this than the Trump administration did.

These commonalities should allow the transatlantic allies to collaborate in implementing a sophisticated, multidimensional, and multilateral China policy.

This policy would combine elements of containment, decoupling, and cooperation vis-a-vis Beijing—depending on the role they assign to China on different issues—and could materialize both in international fora and in the joint development of capacities on strategic economic sectors, security, and defense.

OLIVIA LAZARD/ VISITING SCHOLAR AT CARNEGIE EUROPE

The EU hasn’t been waiting for the United States to work on climate and China. Chinese President Xi Jinping’s decarbonization announcement at the UN General Assembly in September partly resulted from the EU-China summit a week earlier.

It shows that the EU has a strong hand to play when it comes to China, which the United States should seek to enhance. The EU is ready to work with the United States as partners of complementary strengths. Even more, the EU is ready to support the United States in regaining international leadership, which is essential for climate action.

The EU and the United States should seek to play on their complementarity rather than on bloc alignment, lest they risk creating a bloc response on the part of China in return.

Climate change is causing fundamental shifts in national and global political economies simultaneously. The risk relating to these fundamental shifts is to end up in a competition that is disruptive for global peace—and for global climate action.

The EU and the United States need to co-design a strategy that leverages their joint economic and governance power to demonstrate their values and standards. Only this way can they offer an alternative to the expansionary power accumulation and transactional relationships that China offers as a model. This calls for a redesigning of the transatlantic relationship.

PHILIPPE LE CORRENON/ RESIDENT SENIOR FELLOW AT THE CARNEGIE ENDOWMENT FOR INTERNATIONAL PEACE

Four years after Donald Trump’s election, the transatlantic environment has changed a great deal. Besides complications under Trump, Europeans have had to deal with a very different Chinese regime: more authoritarian and much less willing to compromise with either side of the Atlantic.

The aftermath of the 2008 financial crisis had led to an increased Chinese economic involvement in several European countries and a stronger Chinese diplomatic presence, including the 17+1 forum.

As a result, European technologies and infrastructures were acquired by Chinese state entities. This led Europeans to unite unprecedentedly in 2019, when the EU almost unanimously agreed to launch a new China strategy. Unlike between China and the United States, the competition here may not be “strategic,” but it is indeed “systemic.”

In September, Brussels and Washington started a China dialogue which will become even stronger when the Biden administration takes office.

Like the United States, Europeans have accumulated grievances against Beijing. Come 2021, more transatlantic actions will take place on economic matters, including state subsidies, intellectual property, foreign investment screening, and demands for better access to the Chinese market. Climate and the reform of WTO will also be in the cards. The other aspect on which Europeans and Americans will engage is the promotion of shared values. Hopefully, the West will live up to these domestically.

In sum, the transition period provides a window of opportunity for an enhanced dialogue, which no one should underestimate.

GEORGE PAGOULATOS/ DIRECTOR GENERAL OF THE HELLENIC FOUNDATION FOR EUROPEAN AND FOREIGN POLICY, AND PROFESSOR AT THE ATHENS UNIVERSITY OF ECONOMICS AND BUSINESS

Europe understands it needs to get tougher on China, treating it as a systemic rival and a security challenge, not just a trade partner. But the position is not homogenous—Europe needs to forge a common approach within.

Europe’s trade competitiveness—and Germany’s in particular, given its export and investment exposure to China—nurtures economic dependency and geopolitical timidity.

Europeans realize they cannot claim strategic autonomy if they are dependent on China for health supplies and become dependent on Chinese 5G and AI, and they realize that Beijing’s expanding economic influence through targeted strategic investments could translate into rival geopolitical influence.

Europe is ready to work with the United States on China, but not exactly on U.S. terms. The United States also has to make some steps toward the EU. For instance, recognizing that China is a necessary partner for global, multilateral objectives like climate, that there is a shared interest in maintaining global institutions like the WTO and the WHO—with a shared transatlantic interest in reforming them—and that protectionism is not the way forward.

Europe is right to insist that a Cold War rhetoric—from the United States toward China—could easily escalate into self-fulfilling prophecies and confrontations that all sides should wish to avoid.

JUSTYNA SZCZUDLIK/ DEPUTY HEAD OF RESEARCH AND COORDINATOR AT THE ASIA-PACIFIC PROGRAMME OF THE POLISH INSTITUTE OF INTERNATIONAL AFFAIRS

The EU wants to cooperate with the United States on China, and it seems that Brussels is ready to do so.

In June, during the EU-U.S. talks, Borrell suggested launching a distinct, bilateral dialogue focusing on China. The first virtual meeting was held on October 23, a few days before the U.S. election.

Biden’s victory made the EU optimistic about that cooperation. On December 2, the EU released its proposal for a “new EU-U.S. agenda for global change.” The agenda is broad, focusing on shared values, international law, democracy, human rights, multilateralism, cooperation on technologies, trade, and standards—for example regarding online platforms, market distortion, critical infrastructure, AI, and data flows.

Deepening EU-U.S. cooperation worries China—even though the People’s Republic of China is not mentioned as a target. The EU is appealing to the United States to strengthen transatlantic resilience, which is facing common challenges of growing international assertiveness from various actors. It seems China is among them.

The EU’s readiness to cooperate with the United States on China is due to growing unity and better coordination among EU institutions and member states. As a consequence, the EU presented a sharpened China policy—officially in March 2019, but the process of redefining the EU’s China policy started in 2016—based on building its own resilience by establishing various defensive and protective mechanisms.

However, this does not mean that the EU will follow the United States’ China approach, which under Biden is likely to remain tough, albeit with a slight change in style.

The Trump administration made the EU cautious and focused on its own strategic autonomy idea. Now, the EU-U.S. cooperation on China will depend on America’s response to the Europe’s proposal. The two sides must then translate that very broad agenda into specific domains of cooperation.

*Nonresident Senior Fellow, Carnegie Europe and Editor in chief, Strategic Europe
**first published in: carnegieeurope.eu