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date: 25 February 2020

China and the European Union

Summary and Keywords

European Union–China relations have despite different histories and values, economic and political development, geographic distance and interests, not only strengthened over time in institutional terms, but also moved beyond the core area of economic interactions to involve political, security and cultural cooperation. On the whole the relationship is based on partnership and neither sees the other as a potential enemy. Both support a strong United Nations, the existing international trade system, the non-proliferation regime, and the Paris Agreement on Climate Change among others. These joint perspectives are particularly valuable given the retreat of President Trump from a number of hitherto US honored international agreements and commitments, such as on multilateralism, arms treaties and international governance. On the down side initial expectations that growing economic interactions between the EU and China would narrow the gap on human rights and democracy issues between the two parties have not materialized and the EU can no longer pretend to shape the China in its own image. There are also a number of unresolved problems affecting the partnership. Among these are disputes over trade imbalances, investment access regulations in China and human rights issues, on the one hand, and the persistent arms embargo sanctions and unfulfilled market access status for China, on the other. Overcoming these is not being helped by existing misperceptions that Europeans and Chinese have about each other. Furthermore, as China continues to gain economically, partly through the Belt and Road Initiative, seeks to broaden its international relations policy with Chinese characteristics, and moves to an aggressive maritime policy in the East and South China Sea, the EU will find the partnership more testing at both the bilateral and multilateral level.

Keywords: European Union, European Union politics, China, economic interactions, political dialogue, security cooperation, societal relations, values, human rights

Introduction

In the study of EU–China relations, which began to flourish in the 1990s, a number of research themes have been prominent. Of these, the economic relationship has been the main object of interest, followed by concerns with political relations, especially with regard to the human rights dialogue, issues of multilateralism and global governance, and environmental matters; and, to a lesser extent, by interests into security concerns, societal aspects and institutional links. The dominance of economic factors is not surprising, given that China is the second most important economic partner of the EU and the EU is the most important for China. The EU and China are two of the three largest economies and traders in the world. However, other areas have gained currency in the literature since 2010, due to rising concerns with security issues, such as with cyber fraud, terrorist attacks, and the establishment of the EU–China People-to-People Dialogue, (Kirchner, Christiansen, & Dorussen, 2016; Telò, Chun, & Xiaotong, 2017; Wang & Song, 2016). While many publications on the EU and China focus on single events, such as EU–China summits, policies or issues (Farnell & Crooks, 2016; Holzer & Zhang, 2008), some have a wider remit covering the whole spectrum of historical, institutional and policy relations (Christiansen, Kirchner, & Wissenbach , 2018; Snyder, 2009).

In terms of approaches used in the study of EU–China relations, realist perspectives with the emphasis on inter-state power competition, Balance of Power or containment principles, which are characteristics of Sino–US relations (Allison, 2017), have not featured much in EU–China relations, reflecting mainly the lack of EU statehood and military capability. However, studies with a neorealist vocation have found fertile ground in EU–China studies (Shambaugh, 2005; Vogt, 2012). Liberal internationalism as an approach of study can be deemed as the dominant focus from the EU’s perspective of EU–China relations, focusing largely on the gains from economic interaction and the role both partners play in the conduct of international trade and multilateralism (Biscop & Odgaard, 2007; van der Putten & Chu, 2011). Constructivist analysis has also informed research focusing on identity-building of the EU and China as foreign policy actors, and the transfer of values, such as democracy and the rule of law, from the EU to China (Gottwald & Duggan, 2012; Pan, 2010). An approach in EU–China relations with less theoretical pretentions has been foreign policy analysis, focusing on the EU as an external actor, and paying attention to the underlying causes of EU external policy, the stipulated aims and concrete policy measures, the specific policy instruments invoked, and the success and failures in policy achievement (Casarini, 2009). Such an analysis is more at ease than traditional theoretical approaches with accepting the fact that the EU is not a state, but rather is a regional identity with state-like functions, and with a legal personality in international affairs.

Rather than pursuing theoretical aims, this paper will seek to provide an account of the core pillars and drivers of EU–China relations and the performance trends of that relationship. It will focus on four specific areas of EU–China relations, namely, economic, political, security and cultural relations, which can be considered the mainstays of that relationship. The aim of the article is to establish whether, despite different histories and value orientations, economic and political development, geopolitical positions, and interests, the EU and China are able to cooperate in the four respective areas, and if so, to what extent. It will involve exploring the factors that either promote or impede EU–China cooperation in the four policy sectors. As EU–China relations do not unfold in isolation but are part of “outside” influences, consideration will be devoted to influences from external actors such as the United States and Russia. Besides teasing out the different trends in level of cooperation across the four sectors, attention will also be paid on the cumulative effect on EU–China relations generally.

The article will start with a review of the “Evolution of EU–China Relations” by tracing important events and institutional developments since the 1970s. It will then explore the development of EU–China relations in the four policy areas, “EU–China Economic Relations,” “EU–China Political Relations,” “EU–China Security Relations,” and “EU–China Societal Relations,” before finishing with a “Conclusion” assessing the speed and direction of EU–China relations. The main references of the paper will be drawn from key official EU and Chinese documents and statements, and relevant secondary sources.

Evolution of EU–China Relations

In the evolution of EU–China relations since 1975, when diplomatic relations were first introduced between the two partners, three events have left a significant and lasting impact on the direction and speed of that relationship. These were the 1985 EU–China Trade and Cooperation Agreement (TCA), the occurrence of the Tiananmen Square incident in 1989, and the 2003 agreement on a Maturing Partnership—Shared Interests and Challenges in EU–China Relations. It is possible that a fourth important event might be added to these three in the shape of the unfolding of the Belt and Road Initiative (BRI) and the fallout from the “America First” policy introduced by President Trump in 2017.

The 1985 TCA provides the fundamental legal agreement between the two sides to date and also established an EU–China Joint Committee to manage the relationship. It was concluded after China had embarked on a reform course that made it an attractive trading partner with which the Europeans initially enjoyed a surplus. It also occurred at a time when Europe was making a successful transition from the deep seated energy and economic crisis of the 1970s and early 1980s to an uplifting economic growth program via the single market initiative. For China, Europe was soon seen as an emerging pole in a multipolar world and like itself a counterweight to the two superpowers, but Europe was also welcome as a partner for domestic reform and development especially for joint-venture investment, technology and know-how transfer (Christiansen et al., 2018). Although the TCA marked an important milestone in EU–China relations, it took another 13 years before the first EU–China Summit meeting took place. In part this delay was affected by the Tiananmen Square event of 1989.

The Tiananmen Square incident of 1989 provoked severe criticism from both the member states and the EU for what was perceived as the “brutal repression of the people of Beijing” (European Council, 1989) and resulted in the arms embargo sanctions against China, which EU countries and the US jointly introduced and which remains in force. In human rights terms, the EU used the Tiananmen Square incident to harden its stance on China’s human rights record by a strategy of pressure and criticism in multilateral forums such as the United Nations (UN). These actions changed in 1998 when the EU General Affairs Council decided to present a human rights report each year and to establish a dialogue on human rights with China. An important reason for this change was a fear of losing the China market to US and Japanese competition especially in investment (European Commission, 1995, p. 8). Already with the entry into force of the Maastricht Treaty in 1994, which enlarged EU competences in the political fields, a start had been made for a political dialogue between the two partners, and for a phasing out of most sanctions (except for the arms embargo) and the launching of new cooperation projects.

The 2003 agreement on a Maturing Partnership between the EU and China elevated the relationship considerably. It followed the successful entry of China into the World Trade Organization in 2001, for which the EU had lent support, and the fallout from the terrorist attacks on the New York twin towers and the Pentagon in 2001. It was also motivated, if not fostered, by a “similar understanding of the post-Cold War international system and of both partners’ place within it” (Casarini, 2012, p. 23). The 2003 European Commission Communication on the strategic partnership was later paralleled (but not mirrored) by China’s first official “communication” on this subject, the 2003 EU Policy Paper (MOFA, 2003), which echoed the perception of the partnership as strategic in nature (Smith & Xie, 2010, p. 13). A declared common objective of the EU–China strategic partnership is to conduct relations in a spirit of equality, reciprocity, and mutual benefit. Moreover, after the Lisbon Treaty, China has decided, with EU prompting, to upgrade the EU–China strategic dialogue to the same level as that of the China–US strategic dialogue

A further strengthening of the strategic partnership was made in 2010–2012, when the EU and China launched a High-level Strategic Dialogue together with the High-Level People-to-People Dialogue, and in 2014 the two partners introduced the China–EU 2020 Strategic Agenda for Cooperation. In the same year China introduced a Policy Paper on the EU, entitled Deepen the China–EU Comprehensive Strategic Partnership for Mutual Benefit and Win–win Cooperation. Moreover, in July 2016, the Council adopted the EU strategy on China for the coming years (European Commission, 2016a). For its part China issued a Paper on the EU in 2018, which states that: “The European Union, a grouping of countries with the highest level of integration and strong overall strength, plays a strategically important role in the international arena” (Xinhua, 2018). This paper was followed up by a European Commission communication in March 2019 on EU–China: A strategic outlook, which emphasized the need for “reciprocity” and simultaneously portrayed China as a partner and strategic rival in global governance (European Commission, 2019).

EU–China dialogues exist on human rights, and on regional cooperation. Complementing these dialogues are annual EU–China summit meetings, which in turn are facilitated by a number of meetings at a lower level, such as the annual meetings of EU and Chinese Political Directors and the meetings between the EU’s High Representative and the Chinese State Councilor and Foreign Affairs Minister. Overall, EU–China relations represent one of the most broad and institutionalized structures in EU external relations.

Despite the various dialogues and meetings between the EU and China, relations have fluctuated over time or have achieved uneven results across different policy sectors. In part this is a reflection of different value orientations (democracy, sovereignty, and identity), geopolitical positions, and interests between the EU and China. Considerable progress in EU–China relations was made in the 2003–2007 period, ushering-in the Strategic Partnership and benefitting from the fallout (lack of participation by some EU states in the US-led Iraq invasion of 2003). This period is often referred to as the “honeymoon era” of EU–China relations. However, the long-running talks between Beijing and Brussels over a new Partnership and Co-operation Agreement (PCA) stalled, partly because of China’s reluctance to open its markets (Grant, 2013) and partly because of the EU’s reluctance to comply with Chinese wishes for lifting of the arms embargo (Weske, 2007, p. 4), and partly because of China’s reluctance to comply with EU stipulations for greater democratic and human rights reforms. Further, China’s initiative to create a cooperation group with 16 (17 By 2019) mostly Central and East European countries (involving Central European EU member states) have been perceived within the EU as an attempt by China to divide or undermine the collective identity of the EU (Stanzel, Kratz, Szczudlik, Pavlićević, & Doyon, 2016) and the EU’s exclusive competence to manage trade relationships with third countries.

How far the two partners can build on existing ties or are able to overcome existing differences will be particularly tested by two new (by 2016–2017) separate but interrelated factors, namely the impact of the Chinese Belt and Road Initiative (BRI) and the influence of Trump’s “America First” slogan. While the BRI will have a more long-term implication, Trump’s policies will most likely have a more immediate impact on EU–China relations, either directly (issuance of US sanctions on both the EU and China) or indirectly (the safeguarding of free trade principles and the role of multilateral institutions). As developments surrounding these two factors are in flux, a concrete assessment of their likely impact on EU–China relations remains a task for the future. What can be done, however, is to examine the steps that the EU and China have taken since 2016 to the BRI and Trump’s policies and to project their likely future developments. In the following an attempt will be made to explore, to the extent possible within the time frame of this research, the areas of EU–China relations that are likely to be affected by these developments.

EU–China Economic Relations

Since the 1970s, economic relations have been the dominant and significant feature of EU–China relations, with trade and investment reaching $1 bn per day. While the EU is China’s largest market, China is the second largest for the EU. Remarkably the long-standing considerable upswing in EU–China economic interaction has occurred despite setbacks, such as—on the EU side—the economic slowdown caused by the financial crisis in the Eurozone area in 2010–2014, and the drop of Chinese economic growth rates after 2010 from 10 % to around 6 %. However, the growth in EU–China trade and investment has not been without problems and has resulted in trade frictions. Disputes and irritations derive from a number of causes. Among these is the growing imbalance in bilateral trade, with China consistently exporting more to Europe than it imports in return. The EU’s trade balance with China has been consistently negative for the past decade, recording a deficit of €176 bn (trade in goods) in 2017 (Statista, 2018). On the EU side there have been complaints about unfair Chinese business practices and calls for greater openness in China, such as in opening public markets (Godement & Vasselier, 2017, p. 16). Chinese counterclaims relate to the EU’s refusal to recognize it as a full market economy member of the World Trade Organization (WTO). A change in trade patterns is also affecting the trade relationship, with China increasingly producing similar kinds of high value-added goods, which puts both partners in competitive situations in their own markets as well as in third countries. This trend, combined with European suspicions about Chinese overproduction leading to the dumping of its goods, such as steel, at below-cost prices, has meant that trade disputes have become a more regular occurrence. A further source of irritation on the Chinese side has been the fact that while the EU has agreed or ratified Free Trade Agreements (FTA) with South Korea, Vietnam, the Philippines, Japan and is finalizing one with Singapore, it is not willing to negotiate an FTA with China.

Economic relations have also expanded from trade into other areas such as foreign direct investments, monetary policy cooperation and joint development of infrastructure projects. Foreign direct investment (FDI) flows between China and the EU are relatively low when compared to EU’s FDI flows with other third countries. The EU is responsible for approximately one-fifth of FDI inflow into China, but this only represents 6 % of total EU FDI outflows (Goodman, 2015). However, there has been increase since 2014 of Chinese investments into the EU, partially induced by the economic austerity programs that several European countries experienced in the aftermath of the financial crisis 2010–2014. Explanations for the relatively low levels of investment flows between China and the EU have their origin in existing restrictive practices, primarily by China and to some extent by the EU. The EU has long complained about the restrictive regulatory conditions under which EU firms operating in China are required to hand over their intellectual property as a condition for market access and the problems they generally encounter with the protection of intellectual property rights (IPRs). On the other hand, China has complained about being prevented from investing in high-profile European companies, which Europe sees as a strategic threat to its position in the global market place (Christiansen et al., 2018; Niquet, 2018). In view of a string of Chinese investments in sensitive European assets, including utilities, transportation infrastructure and technology, the European Commission has identified the establishment of reciprocity as a pressing challenge (European Commission, 2016b) and has adopted a new instrument thatwill allow it to screen incoming FDI (including but not exclusively from China) against considerations of public security and order where the FDI could affect EU projects or interests (Godement & Vasselier, 2017, pp. 54–57).

The benefits of the two-way flow of investment capital is well recognized, but increasingly so are the perceived risks that come with foreign control over key parts of the economy. While more work is required to find satisfactory solutions to the investment flows, there are encouraging signs in other areas that point to an understanding of mutual economic dependence between China and the EU. The recession in Europe, resulting in a significant drop of Chinese exports to the EU, also had an impact on growth in China, where, as has been remarked, growth rates dropped from 10 % in 2009 to 6–7 % in 2015. This reduced growth also led to Chinese support for the European economy, be it through a rise in investments (for example in infrastructure projects) or through the purchase of sovereign debt of individual European states. In turn, it also paved the way for the decision by most EU member states to become members in the China-inspired Asia Infrastructure and Investment Bank (AIIB), which is the financial arm of the Chinese BRI. EU member states have secured 20.2 % of all votes, secondly only to China with 26.06 % of votes.

The aim of the BRI, which seeks to embrace 65 countries, is to develop a series of trade and economic corridors. At the EU–China 2018 summit, the two sides reiterated their commitment to continue to forge synergies between China’s BRI, which requires an estimated €1.3 trillion per year for infrastructure investment in the coming decades, and the EU’s initiatives, including the EU Investment Plan (Juncker Plan of €315 billion) and the extended Trans-European Transport Networks, and to promote cooperation in hardware and software connectivity through interoperable maritime, land and air transport, energy, and digital networks (European Council, 2018a). These activities will also be promoted through the EU–China Connectivity Platform, which was established in 2015.

Yet these attempted synergies also face important challenges, such as assuring that Chinese investment in the planned infrastructure projects in Eurasia meet EU public procurement standards and environmental provisions. Already, Chinese investments in a rail link between Budapest and Belgrade, a BRI showcase project in Europe, are currently under investigation for their compliance with EU public procurement law (Financial Times, 2017).

Large-scale Chinese investment in Europe’s infrastructure, moreover, does not only bring about economic challenges. Concerns are also raised by China’s growing political clout in Europe, which might increasingly enable China to neutralize the EU’s stance on contentious issues by cajoling individual member states into blocking or toning down joint EU statements and initiatives (Godement, Parello-Plesner, & Richard, 2011). Already there have been indications of such occurrences. For instance, Hungary and Greece, both major recipients of Chinese infrastructure investments, pressed the EU into toning down its reaction to a ruling by the permanent court of arbitration issued in July 2016, which sought to settle a maritime dispute between the Philippines and China over the legal basis for Chinese claims to “historical rights” to resources in the South China Sea (Fallon, 2016). Another case occurred in June 2017 when Greece blocked a EU statement prepared for the scheduled review of China’s human rights situation in the UN Human Rights Council (Klose, Pepermans, & Wang, 2017). The multilevel nature of EU policy-making, exacerbated by the 16-plus-1 arrangement, and the continuing tendency of states to seek their own arrangement with Beijing, makes it easy for China to play off one level (or even one state) against another (Meunier, 2014).

A relatively new challenge to EU–China economic relations has been the “America First” slogan introduced by President Trump, which not only has resulted in the US levying custom duties of Chinese and European imports on such products as steel and aluminum in the summer of 2018, but is also threatening to undermine the role of the WTO. Being a fierce critic of WTO and a believer that bilateral deals suit America’s interests better, the US administration is blocking nominations to seats on the WTO appellate board, which could leave it unable to hear cases after 2019.

In response to this pending threat, leaders at the EU–China 2018 summit agreed to cooperate on WTO reform. At that summit the European Council President stated: “The EU is committed to working towards the modernisation of the WTO and calls on all partners to contribute positively to this goal” (European Council, 2018b). However, there was also an indication that, whilst the EU disagrees with Trump’s tactics, it agrees with the substance of America’s grumbles about China’s forced transfer of technology, uneven protection of intellectual property, and state subsidies for its firms which have caused gluts in supply of commodities such as steel. There is, hence, a strong EU desire for reform of the existing WTO rule book.

Overall, the economic relations between the EU and China have shown themselves to be durable. Decades of growth in trade and in foreign direct investment have created a strong sense of interdependence, and on the foundations of flourishing economic exchanges other aspects of the relationship—political, security, societal—have also been expanded (Chen, 2016). The question for the future is whether, in a rapidly changing global climate where trade liberalization is seen increasingly critically, and where the nationalist politics of President Trump might herald a new era of protectionism, the economic relations between China and the EU will be able to weather the coming storm and, in particular, reduce the asymmetry in openness to each other and rediscover the virtues of cooperation

EU–China Political Relations

While economic relations represent the core of EU–China relations, EU–China political relations can be considered the high ground of that relationship involving such issues as democracy, sovereignty, multilateralism and global governance. It will hence be the objective in this section to establish to what extent EU–China relations are converging or diverging on those issues. In particular, two specific aims will be explored. First, EU concerns over Chinese barriers to democracy, freedom of expression, adherence to the rule of law, and respect for human rights will be addressed. Or, to put it differently, to what extent is the EU able to transmit its values to China on, for example, democracy and the rule of law? Second, an attempt will be made to determine the extent to which China is supportive of EU multilateral efforts, the stability of international organization and the maintenance of global governance.

Democracy and Human Rights

Although both partners have made efforts, especially the EU, it has not been easy to overcome different views between the EU and China on issues of human rights, religious freedom, or democratization. These differences reflect cultural and historical factors. For example, when the Chinese talk about democratization, their focus is on responsibility, responsiveness, and accountability of government authorities; for Europeans it is all about empowering civil society, the rule of law, and respect for human rights (Geeraerts, 2013, p. 498). While the EU puts stress on personal freedom and the rights of individual citizens in a universal (UN) context, China favors the community over the autonomy of the individual and emphasizes the notion of equality among citizens. Nonetheless, in 1998 China signed the UN Covenant on Economic, Social and Cultural Rights (ICESCR) and ratified it in 2001. It has also signed (1998) but not ratified the International Covenant on Civil and Political Rights (ICCPR). There have also been visits to China by the UN Commissioner for Human Rights.

Despite these progressive developments, serious shortcomings in China’s human rights remain, resulting in EU complaints that the EU–China human rights dialogue is not producing tangible results, and that expectations are increasingly not being met (e.g., European Commission, 2006, pp. 4–5). The shortcomings are in such areas as the suppression of freedoms among certain ethnic minorities and political dissidents, the use of forced labor (the practice of re-education through labor persists), a still underdeveloped system of rule of law, and the extensive use of the death penalty. Freedom of expression, religion, and association are still not guaranteed in Tibet and Xinjiang, and whilst NGOs and think tanks have grown (for further details see “EU–China Societal Relations”), they still face important hurdles in realizing their full potential (European Commission, 2003, p. 12), and repeated EU calls for ratification of the ICCPR have not been met. Moreover, in its 2016 China strategy paper, the Commission expressed its disquiet about China’s crackdown on defense lawyers, labor rights advocates, publishers, journalists, and others for the peaceful exercise of their rights, and for China’s adoption of a number of restrictive national security laws (European Commission, 2016a, p. 4). While Chinese intransigence affects EU–China cooperation on human rights issues, on the EU side, tensions between economic interests and human rights principles, together with the existing inadequate coordination between the European Commission and member states’ strategies on these issues, also hinders closer cooperation between the two partners (European Commission 2006, p. 5; Fox & Godement, 2009; Kaya, 2014). Hence, the key problem for the EU is how to square the large economic benefits derived from trade with China with its normative (reform-minded) ambitions for that country; a problem that appears increasingly staged in favor of the former (Crookes, 2013).

Looking to the future, limited progress in EU–China political relations, such as accompanied by successes in the EU–China People-to-People Dialogue, seems to be in the offing. However, there is also a possibility that a waning interest by the US Trump administration for democratic reforms and human rights concerns in China is likely to undermine EU efforts in this field.

Multilateralism and Global Governance

China and the EU not only have extensive economic interactions, they also occupy a large part of global trade. Much of these achievements have been due to the existence of liberal international trade rules and organizations, such as the WTO and the UN, and relatively stable international political developments. However, while both partners benefit from these international conditions, they are not equally committed to their cause. Different identity formations and interests between China and the EU hinder common views and significantly impede joint actions in support of multilateralism and global governance. China and the EU not only have different interests with regard to global governance, they also differ with regard to their respective outlooks on principles such as sovereignty and non-intervention. The EU, by its very nature, has a more flexible understanding of the principle of sovereignty and is widely seen as a normative or “civilian” power. This understanding also makes Europeans believe that states have the responsibility to protect in case of serious breaches of human rights. By contrast, for China, sovereignty and the pursuit of national interest remain an absolutist concept. The Chinese undiluted concept of sovereignty is partly shaped by a domestic insecurity lingering from the “century of humiliation” alongside a view that domestic decision-making is “culture-specific.” The Chinese have also traditionally been wary of participation in traditional multilateral institutions in which they are uncertain of playing a formative and prominent role. Instead they have created or sought involvement in new organizations such as the Shanghai Cooperation Organization (SCO), BRICS (Brazil, Russia, India, China and South Africa), the East Asian Summit, or the G20 group (Gill & Small, 2012, p. 56). China is also promoting new financial international governance structures such as the New Development Bank (NDB) and the Asian Bank for Infrastructure and Investment (AIIB), which could be seen as rivaling—or in China’s parlance merely supplementing—the IMF, the World Bank, as well as the Asian Development Bank. This diverging Chinese commitment presents an awkward choice for the EU as to whether to concede ground (i.e., a reduction of its representation in existing international organizations such as the IMF and the World Bank) to emerging powers like China, and how to react to the proliferation of a new governance structure in which China dominates. It is for this reason also that while China sees these institutional fragmentations as part of a strategy to replace the dominant position of the United States in global governance, with a more multipolar one, the EU is reluctant to fully share such endeavors.

Arguably, given their size global trade share and economic capacities, EU–China political relations matter for global stability and prosperity. However, even in the areas where there is EU–China cooperation at global level, their contributions to global governance are not always substantial. The absence of China in the G7/G8 and the lack of a formal role for the EU in the UN Security Council limit the opportunities for deeper and more systematic security cooperation in multilateral and global fora, even if, in the economic realm, recent developments with regard the G20 and the AIIB have brought a large number of EU member states and China together in the context of a changing global governance architecture in this field. An area where close multilateral cooperation between China and the EU exists is with regard to the Iranian nuclear deal, which was concluded in 2015 between Iran and permanent members of the UN Security Council plus Germany and the EU, known as the Joint Comprehensive Plan of Action. In the aftermath of President Trump’s decision in the summer of 2018 to withdraw from the agreement and to introduce new sanctions against Iran, both China and the EU expressed support for the continuation of the agreement.

The US withdrawal from the Iranian nuclear agreement in 2018 was only one of several steps President Trump had taken since coming to office to repudiate the rules-based international order, such as with regard to free trade, climate change, and the role of international institutions. Both China and the EU have indicated a desire to strengthen cooperation in an effort to combat this erosion at the international order, giving particular strong expression to this effect at the EU–China summit of July 2018 (European Council, 2018a).

In the era of Donald Trump, Europe can no longer rely on America to protect the liberal international order the EU needs to seek common ground with China and possibly Russia. However, it will be interesting to see to what extent the EU can rely on China to deliver support in practice. There have been a number of high-level speeches, such as the keynote address delivered by Xi Jinping at the World Economic Forum in Davos in January 2017, to position China rhetorically as a champion of the existing international order and the global governance system. To judge by actual deeds, such as China’s rejection of a ruling by a tribunal established pursuant to the UN Convention on the Law of the Seas (UNCLOS) in 2016), expectations of a championing of the existing international order have been unsubstantiated to some extent, which gives credence to those who expect that these speeches reveal a plan for a risen China sitting at the heart of a Sinocentric regional order (Rolland, 2018).

Overall, there are considerable obstacles to making progress in EU–China political relations. The EU is overwhelmed by internal and external challenges, e.g., Russian threats in Eastern Europe. China has proclaimed itself a champion of globalization, but the playing field for foreign businesses in China is still far from level. However, if Trump quits the WTO, other powers, like China and the EU, or Japan and the EU, will have an opportunity to rewrite rules. The extent to which shared economic interests between these parties also affect security interests will be examined next.

EU–China Security Relations

As the foregoing sections have demonstrated economic, political, and security concerns are becoming increasingly intertwined. For example, with respect to enhancing economic security, both China and the EU have sought to stimulate growth through large-scale investment programs supporting infrastructure projects and thereby enhancing opportunities for trade. As suggested by Gartzke (2007), economic interdependence enhances prospects for peaceful cooperation, limits the scope for conflict and helps to underpin mutual security. Yet it also needs to be stressed that the EU lacks military credentials, as member states rather than the EU have the mandate for security relations, consequently affecting the cohesion of EU security policies (Duke & Wong, 2016). Furthermore, the absence of a distinct EU military presence in Asia, and the NATO membership of most EU countries, diminish EU attractiveness as an independent security actor in its dealings with China. The lack of EU military presence in Asia makes the EU look impotent in terms of dealing with potential conflicts arising from the Taiwan Straits or Chinese assertiveness in the East and South China Seas, or for that matter with upholding the freedom of navigation in that region. This ineptness is further undermined by the absence of the EU from the Six-Party Talks concerning the North Korean nuclear arms program. In seeking to be taken seriously as a (hard) security actor in East Asia, the EU finds itself torn between, on the one hand, the potential irrelevance that comes with having no assets of its own in the region and, on the other hand, losing its potential as a neutral player due to its close association with the United States (Christiansen et al., 2016). While this does not altogether exclude cooperation on military matters between the EU and China, it does put the emphasis more strongly on cooperation in the non-traditional aspects of security, where both the EU and China may perceive common threats and desire a common response, for example, with regard to counterterrorism and climate change.

Despite shortcomings in the overall level of EU–China global security governance cooperation there are areas where both partners have made progress, such as on maritime security (the anti-piracy EU mission in the Gulf of Aden), non-proliferation of WMDs (the Iranian nuclear deal), counterterrorism, especially with regard to combatting the financing of international terrorism, and civil protection, such as on emergency management and disaster emergency humanitarian aid cooperation in the field of peacekeeping. With China becoming the second-largest contributor, after America, to the UN’s peacekeeping force and the third-largest donor to the UN’s budget after America and Japan, there are increasing prospects for cooperation in this field, such as is the case already in Mali between the Chinese UN peacekeeping force and the EU mission. Moreover, at the EU–China summit of July 2018, both partners expressed the desire to maintain high-level exchanges on security and defense policy, strengthen their communication and facilitate cooperation through policy dialogue mechanisms, actively promote training and seminars for personnel, and maintain the momentum of cooperation in such areas as anti-piracy escort missions and international peacekeeping. A further plus point in EU–China cooperation is the commitment of both partners, once again expressed at the 2018 EU–China summit, to the 2015 Paris Agreement and the intention to honor its implementation.

Whether security cooperation can be expanded via the BRI appears both as a challenge and an opportunity. Opportunities arise from the road part of the BRI that will traverse Central Asia, and would provide synergies between Chinese investment plans in infrastructure and connectivity and the EU’s (Juncker Plan) investment program, as well as through the services of the European Bank for Reconstruction and Development (EBRD) and the European Investment Bank (EIB). However, Chinese investments in Central and Eastern Europe and Central Asian infrastructure, besides raising concerns about EU competition and environmental standards, also invoke the specter of geoeconomic and potentially political dominance in that region. In other words, there is a danger that Chinese investment in Central Asian states will make them dependent on Chinese capital and increasingly bound by Chinese rules governing everything from trade to cybersecurity. Robert Kaplan (2018) goes as far as to argue that China’s BRI uses infrastructure as a weapon for neocolonial domination. Yet, the US withdrawal from the Trans-Pacific Partnership (TPP) risks some Asian countries being sucked closer into China’s orbit. On the other hand, the EU expansion of FTA’s with a number of Asian countries, and not China, is regarded by China with some hostility, and might be the source of future disputes (Ye, 2015).

Besides Chinese and EU interests in Eurasia, Russia also consider this region its sphere of interest. As part of maintaining its interest in the region and in part to dilute or prevent EU enlargement in Eastern Europe or Central Asia, Russia has established the Eurasian Economic Union (EEU). Russia and China have agreed to pursue convergence between the BRI and the EEU. As the three main integration projects in the Eurasian landmass—the EU, the EEU and the BRI—geographically overlap, there might be an opportunity for them to work together to avoid conflict and look for synergies between their objectives. However, the EU is rightly suspicious that the EEU is more of a Russian geopolitical project than a genuine economic union between its members (Bond, 2017). In addition, significant changes on the part of Russia’s foreign policy, such as with regard to the Ukraine, would need to happen before the EU could engage into a trilateral strategic dialogue with both China and Russia.

Overall, EU–China efforts to develop a security partnership remain at a low level. However, in the context of structural differences and adverse global conditions, this is actually quite significant. Even a low level of cooperation is, after all, cooperation, and as such a counterpoint to the hostility that frequently characterizes China’s relations with, say, the US and Japan, or the mistrust that has developed between the EU and Russia in the aftermath of the Ukraine crisis (Christiansen et al., 2016). Actual security cooperation has tended to be selective, covering mostly non-traditional aspects of security such as non-proliferation, energy and climate change and the fight against international terrorism. Several factors are responsible for this. First, with few exceptions (e.g., climate change) the EU lacks coherence in its security policy approach with China in that it is unable to effectively coordinate security policy among the various national strands and parallel attempts of member states to conduct their own policies with China. Second, the EU lacks a sufficiently distinct security profile with respect to the US. It can therefore be too easily discredited by China as lacking independence, relevance, and trust. A case in point is the non-lifting of the arms embargo, as already mentioned. These EU deficiencies are further exposed by EU security concerns emanating from Chinese maritime activities in the East and South China Seas and the growing Chinese geopolitical influence in Eurasia and the Middle East, as advanced by the BRI and as facilitated by the Chinese military base in Djibouti and planned naval base in Gwadar.

EU–China Societal Relations

For economic, political, and security cooperation between two or more countries to flourish, an understanding, if not appreciation, of their respective societal characteristics and cultures is important. In addition, citizen diplomacy can be considered an alternative problem-solving strategy, underpinning the role that non-state actors may play in mitigating difficult inter-state relations and helping to resolve deep-rooted conflicts that political leaders and the private sector cannot solve alone (Fulda, 2013, p. 2).

Formally speaking, societal relations can also be seen as another aspect in the strategic relationship between the EU and China since “people-to-people relations” constitute a third pillar in the dialogue structure of the strategic partners, and thereby have developed into an essential aspect of public diplomacy between the two sides (Burnay, Hivonnet, & Raube, 2014). This strategic aspect is evidently the case with the EU–China High-Level People-to-People Dialogue (HPPD) on Education, Culture, Youth and Research, which was established in 2012. The HPPD represented an important step in EU–China cultural relations that have grown in stature since 2010, partly helped by the EU gaining competencies through the Lisbon Treaty to deal with cultural matters. The first EU–China cultural summit in 2010, which has become an annual event, was followed in 2011 with the China–EU Year of Youth and in 2013 with the China–EU Year of Intercultural Dialogue. Beyond this officially sanctioned interaction, societal relations more generally can be considered a channel for normative encounters between people from Europe and China, and as such constitute an arena for “soft power” in EU–China relations.

Cultural links between individual EU member states and China, facilitated by cultural organizations such as the Alliance Française, the British Council, the German Goethe Institute, the Spanish Cervantes Institute, the Italian Dante Alighieri Society, and the Portuguese Camões Institute, have been long-standing. Since 2012, China has established some 700 Confucius Institutes (CI) and classrooms around the world, teaching the Mandarin language, providing information about China, and showcasing Chinese arts and culture. While much of this is uncontroversial, the rapid rise in the number of Confucius Institutes around the world, and the resources that China has made available to the “CI project,” has raised questions and comments about this aspect of Chinese soft power. There is also a connection between the soft power aspects of the CI and those attributed to the BRI.

These cultural institutions have promoted educational and academic links and been complemented by EU and Chinese government efforts. On the EU side, a number of programs were initiated from the late 1990s onward, such as the EU–China Higher Education Programme, and the establishment of Jean Monnet chairs, centers and teaching modules on European Studies in China and the fostering of student and academic exchanges between China and the EU. Other EU initiatives have been the establishment of the China–Europe International Business School, the European School of Law, and the EU–China Academic Network. On the Chinese side a number of government-sponsored programs have been introduced since the early 2000s, providing inter alia scholarships for Chinese postgraduate students to study in Europe. The argument can be made that such education cooperation constitutes an important part of the EU’s public diplomacy, and is therefore an element of Europe’s soft power (Yang, 2015). On the other hand, it also reflects China’s interest in tapping EU knowledge (Wiessala, 2013, p. 218).

Besides cooperation in the sector of EU–China higher education, efforts have also been made to bring Europeans to China through the EU–China Junior Managers Training Programme, and to encourage links among social organizations or civil society organizations (CSOs). However, as Sausmikat (2010, p. 89) suggests, Chinese CSOs are constantly being confronted with the fact that their Western partners follow their political agenda of system change, and are unable to accurately judge the circumstances in China, which places the Chinese CSOs under enormous pressure. For the European CSO, the challenge when dealing with their Chinese counterparts is to tread a delicate balance between CSOs and NGOs that are officially recognized or sanctioned by the Chinese Government and those that are tacitly tolerated at the grassroot level. Moreover, in dealing with their Chinese counterparts, EU CSOs and NGOs want to be seen as pursuing, as far as possible, a reform-oriented agenda rather than one which is simply seen as supporting the regime.

Tourism has also become an increasingly significant part of EU–China relations. The fast growth of this aspect of the relationship is demonstrated by the fact that, by 2016, the number of Chinese tourists in Europe had risen to 10.2 million (European Travel Commission, 2017). Stress was given again at the EU–China summit in July 2018 to find agreement on visa facilitation and on cooperation in combating illegal migration (European Council, 2018a).

Yet despite these growing societal interactions between China and the EU, perceptions Europeans have about China are not necessarily reflecting this trend. A poll by the German Marshall Fund, undertaken in 2013 in 12 EU member states found that 46 per cent agreed that China is more of an economic threat than an opportunity (German Marshall Fund of the United States, 2013). These European perceptions of China point to a need for more socialization in order to bring greater trust and confidence between European and Chinese cultures and peoples. As suggested by Gillespie (2013), Europe and China suffer from mutual knowledge and comprehension deficits, reinforced by uneven and selective media coverage of each other.

In recent years, following greater liberalization of China domestically and the growing commercial connections between Europe and China, societal contacts have grown exponentially. In the absence of dedicated research, it is difficult to gauge the wider impact that such societal interaction has had on EU–China relations. What is evident, in any case, is that even when contacts are predominantly of a cultural or social nature, the political and economic dimension of such interaction is never far removed.

Conclusion

Starting from very low levels of economic interaction in the 1970s, EU–China relations have since multiplied and strengthened as evidenced in a number of highly institutionalized dialogues. This evolution is not only apparent in the economic sphere, where the EU is China’s largest trading partner and China the EU’s second-largest one, but also in stronger ties in the domains of security, through the Strategic Partnership, and culture, through the People-to-People dialogue. Important manifestation of the strengthened relationship have also been evident in Chinese support for overcoming the Euro crisis 2010–2012, and joint efforts by the EU and China to defend international agreements, such as the Paris Agreement on climate change and the Iran nuclear deal, as well global free trade. Hence, despite different histories, economic and political development, geopolitical positions and interests, the EU and China have become strategic partners cooperating on a wide range of issues and have established a strong platform for further interaction.

Yet these achievements aside, considerable differences remain between the two sides over values, such as on the concepts of democracy and sovereignty, and the issues of human rights. In Europe the notion of state and sovereignty is undergoing fundamental changes, while in China it is still very much steeped in exclusive state sovereignty traditions, because of historical and developmental factors. On human rights issues, two observations seem appropriate. First, the hope that a China with open markets and a firm rule of law will be more likely to respect human rights and allow democratic freedom (Barysch, Grant, & Leonard, 2005, p. 52) has not sufficiently materialized and the EU can no longer pretend to shape the China in its own image. Second, the EU has not been more successful in extending its concept of universal human rights to China partly due to internal coordination problems and an uneasy coexistence between normative concerns and material interests. Besides differences over values, there are also other areas in which the two sides diverge, such as with regard to Chinese market access under WTO rules and a lifting of the EU’s arms embargo on China, or have different concerns, such as over Chinese maritime activities in the East and South China Sea.

In addition to the impact of internal impediments on EU–China relations, external actors, such as the United States and Russia, also affect the relationship. Already by mid-2018 there were indications that Trump’s “America First” slogan was challenging hitherto practiced international trade and diplomatic principles, which are important pillars of EU–China relations. How the two partners will rise to these challenges, or to changes in the geopolitical sphere (e.g., denuclearization efforts of Korea peninsula, Russian foreign policy adventures), requires careful future assessment. What will undoubtedly help to meet future challenges is the fact that China and the EU consider themselves partners rather than enemies.

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