Why EU's ties with China are likely to remain tense

Arab News

20 hours ago

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Relations between the EU and China last reached a mini-high during Donald Trump's disruptive first presidency, when Beijing and Brussels agreed a Comprehensive Agreement on Investment. However, bilateral ties have not warmed during Trump's second term in the White House, despite the US president threatening to instigate several new trade wars with his tariff policies.
Certainly, the mood between the EU and China is generally constructive and both sides are keen to showcase some achievements in relations during this landmark year, which marks the 50th anniversary of bilateral ties. This includes during their upcoming annual summit on July 24, when European Commission President Ursula von der Leyen and European Council President Antonio Costa will hold talks with Chinese President Xi Jinping and Premier Li Qiang.
Both sides stress that they have no insuperable conflicts of interest, and instead share common economic and political interests that are deepening. Underneath this high diplomacy, however, growing challenges are chilling relations, including the issue of the war in Ukraine.
Take the example of rare earths. This is a topic on which von der Leyen and Costa will this week urge China to end restrictions that require EU-based exporters to secure licenses from Beijing, which controls more than 90 percent of the global processing capacity for these key metals. During the G7 Summit in June, von der Leyen accused China of 'coercion' and 'blackmail' over the measures, asserting that 'no single country should control 80-90 percent of the market for essential raw materials and downstream products like magnets.'
On the economic front, China's trade surplus with the EU hit a record high in May, and now stands at about €400 billion ($465 billion). One of the steps the EU has taken in response is to levy tariffs of up to 35 percent on Chinese electric vehicles, citing unfair subsidies. Beijing retaliated with inquiries into the European dairy and brandy sectors.
In the face of these proliferating challenges, von der Leyen, Costa, and other top EU officials are trying to build a broader, bloc-wide stance on China. This reflects the fact that Brussels has struggled at times to find common purpose across all 27 EU member states on the issue, especially those such as Hungary that are more sympathetic to Beijing.
Worse still, leading EU officials have become increasingly concerned in recent years about whether the nature of China's external interventions in Europe represent a strategy of divide-and-rule in an attempt to undermine the continent's collective interests.
The former EU foreign affairs chief, Joseph Borrell, even asserted that Beijing was a 'systemic rival that seeks to promote an alternative model of governance' to that of Europe. Von der Leyen said more recently that 'China has an entirely different system' with 'unique instruments at its disposal to play outside the rules.'
Brussels has sought to unite the bloc around a stronger policy toward China.
Andrew Hammond
The backstory to this is that Europe is becoming an increasingly important foreign policy focal point for Beijing, economically and politically. The rising superpower had generally enjoyed growing influence across much of the region, at least until the COVID-19 pandemic.
In the past five years, however, since the pandemic and Russia's invasion of Ukraine, relations have become chillier. This has affected issues such as climate cooperation, with doubts reported about whether Beijing and Brussels will sign a joint climate action pledge during their upcoming summit, despite the precedent of previous important collaboration in this area.
Brussels has therefore sought to unite the bloc around a stronger policy toward China, with von der Leyen taking the lead on the issue, even though the role of European Commission president does not include any formal foreign policy mandate.
While the EU still deeply values its relationship with China, the direction of travel for policy on Beijing appears to be moving in a more hawkish direction. Even on issues in which breakthroughs have been made with China over the past five years, such as the Comprehensive Agreement on Investment in 2020, ratification of this key economic deal has stalled for years in the European Parliament as a result of deteriorating relations.
A central challenge for von der Leyen, however, remains the splits within the 27-member bloc regarding views on Beijing. It is too simplistic to characterize this as an East-West dichotomy within the region, not least because Hungarian Prime Minister Viktor Orban is perhaps China's biggest cheerleader in the EU.
There are nonetheless differences in outlook, primarily between hawkish Eastern European nations such as the Czech Republic, Poland, and Lithuania, versus Western counterparts such as France and Spain that do much more bilateral business with China. The positions of those Western European nations can be particularly problematic for Brussels, given that both Paris and Madrid want extensive economic engagement with China to continue.
The longstanding, deep business ties between Paris and Beijing are widely documented, so it is no surprise that President Emmanuel Macron is sometimes more equivocal than von der Leyen on the issue of China. During a joint visit with her to Beijing in 2023, the French president raised eyebrows in Europe by taking a large business delegation with him. He also utilized the language of economic reciprocity, rather than the European Commission president's preferred choice of 'derisking,' and did not appear to put significant pressure on China regarding its support for Russia in Ukraine.
This challenging context underlines why the upcoming summit might underdeliver on even the low expectations that surround it. Overall EU relations with China are likely to remain chilly for the foreseeable future, and could yet go into a deep freeze during von der Leyen's second term as European Commission president.
• Andrew Hammond is an associate at LSE IDEAS at the London School of Economics.