China Looks to Salvage Relationship With Europe

With its ties with the U.S. shakier than in decades, Beijing is becoming wary that its alignment with Russia during the Ukraine crisis could also cost it a relationship that has sometimes functioned as a buffer in its contest with Washington: Europe.

For years, Chinese leaders have deployed a divide-and-conquer approach to Europe, enticing some nations such as Germany and those in Central and Eastern Europe with both market access to the world’s second-largest economy and greater Chinese investments in some of those countries.

The strategy—along with concerns over Beijing’s use of economic and other measures to punish countries running afoul of its interests—has bred growing distrust of Beijing in the European Union, but the bloc remains eager to find a middle way with China that allows it to sidestep Sino-U.S. tensions.

President Xi Jinping’s decision to partner up with Russian President Vladimir Putin just weeks before Russia’s invasion of Ukraine could undercut the EU’s willingness to work with China.

 

When China and the EU meet for a virtual summit April 1, European Commission President Ursula von der Leyen and Charles Michel, president of the European Council, plan to stand with the Biden administration in warning that China’s relations with the bloc would suffer if it provides substantive assistance to Russia in its military assault in Ukraine, according to foreign-policy analysts in Europe.

At stake is one of the world’s biggest economic relationships, with bilateral trade of $828 billion in 2021—and it is one that has become increasingly important to China as ties with the U.S. have deteriorated.

At the center of the business links is China’s trade with the EU’s powerhouse, Germany, which in 2021 marked Beijing as its No. 1 trade partner for the sixth consecutive year. Berlin continues to advocate for engagement with China, long after such calls vanished in Washington.

Those links have provided an outlet for China—one it can ill afford to lose now that the strategic rivalry with the U.S. has taken a possibly irreversible turn over its support of Russia.

To keep the relationship with Europe from falling off a cliff, Mr. Xi is expected to highlight the scope for cooperation between China and Europe during the summit, say foreign-policy experts close to the Chinese government. Much as he did with President Biden last week, Mr. Xi is also likely to seek to present China as neutral in the Ukraine conflict, the experts say, even as China sticks to its partnership with Russia to counter the U.S.-led West.

The Chinese leader is expected to advocate having Europe play a leading role in negotiations and emphasize Beijing’s plans to provide humanitarian aid to Ukraine.

“This could be the most political EU-China summit ever,” said Noah Barkin, a Berlin-based analyst on Europe-China relations at Rhodium Group, a research firm. “The idea of China as a partner to Europe would begin to crumble if China goes beyond its rhetorical support to Russia.”

China was a topic in Mr. Biden’s meetings with European leaders and the North Atlantic Treaty Organization this week in Brussels, with NATO specifically calling out China over concerns about military assistance and disinformation supporting Russia’s narrative around the war.

During discussions Thursday evening, EU leaders and Mr. Biden agreed to convey to Beijing that its cooperation with Russia would come with a price, according to two European officials briefed on the talks.

“Clearly the line we are going to push forward on April 1,” one of the officials said.

Mr. Xi on Friday spoke with U.K. Prime Minister Boris Johnson in what Mr. Johnson’s office described as an hourlong “frank and candid” conversation that included Ukraine.

As with his earlier conversations with European leaders, Mr. Xi told Mr. Johnson that China is ready to play a “constructive role” in facilitating a peaceful settlement to the Ukraine crisis, according to a statement from China’s Foreign Ministry.

The last EU-China summit, in December 2020, ended with a far-reaching investment treaty between the two sides. Back then, four years of the Trump administration had soured Europe’s ties with Washington although Europe was already labeling Beijing a systemic rival as well as potential partner. Mr. Biden, taking office soon afterward, started a rapprochement with Brussels—part of his effort to work with allies to pressure China.

The investment treaty was thrown in a deep freeze as a result of Beijing’s blacklisting of European lawmakers, China experts and diplomats in response to selective EU sanctions on four Chinese officials for Beijing’s treatment of Muslims in Xinjiang.

Over the last two years, the EU gradually has been building up defensive tools to guard itself from Chinese economic pressure, including advanced efforts to prevent takeovers of EU firms by state-subsidized firms and to block subsidized foreign firms from winning EU government contracts.

It also has logged a complaint with the World Trade Organization over Chinese retaliation against Lithuania, whose move last year to let Taiwan open a representative office there was followed by Beijing’s blocking of Lithuanian imports, including Lithuanian components of products from other EU countries.

Lithuania, which has close ties to Washington, was the first country to leave the 17+1 grouping which allowed smaller EU countries to meet directly with Chinese leaders. Others have said they may follow suit over Beijing’s heavy handed diplomatic pressure over Taiwan, a shift that could speed up were Beijing to side openly with Russia over Ukraine.

Ms. von der Leyen and Mr. Michel plan to tell Mr. Xi that China’s posture toward Lithuania is an attack on the bloc’s single market. They might also raise concerns about a Chinese military threat to Taiwan, diplomats say.

 

To better coordinate their responses to China, Washington and Brussels have worked to reduce their own tensions. The last time Mr. Biden was in Brussels, in June, the two sides announced a truce in their 17-year fight over subsidies to Airbus SE and Boeing Co. and started a new forum, the U.S.-EU Trade and Technology Council, to improve dialogue and coordination on emerging areas of concern, many prompted by China and its policies.

They have also established an EU-U.S. dialogue meant to identify and handle economic and political challenges posed by Beijing.

Such trans-Atlantic cooperation in recent months led to close coordination on possible sanctions against Russia over Ukraine, informed by the insights U.S. and European officials had gleaned about each other’s economic strengths and vulnerabilities.

Meanwhile, European business interests are anxious to not push China too far.

Joerg Wuttke, president of the EU Chamber of Commerce in China, said it is important for Europe not to present its message over Ukraine as a threat to China. “Clearly a major concern among Chinese officials is that Europe is losing its independence and is being pushed further into the U.S. camp,” Mr. Wuttke said.

In Europe, officials approach the issue differently.

Days after Moscow and Beijing signed a joint statement that criticized expansion of NATO and declared joint opposition to pro-democracy “color” revolutions across the former Soviet bloc on Feb. 4, Ms. von der Leyen used a speech at the Munich Security Conference to rally against the Beijing-Moscow alliance.

“We are facing a blatant attempt to rewrite the rules of our international system,” Ms. von der Leyen said. “They prefer the rule of the strongest to the rule of law, intimidation instead of self-determination, coercion instead of cooperation.”

Latvian Prime Minister Arturs Krišjānis Kariņš, asked Thursday about the messaging to China on his way into the EU leaders’ meeting with Mr. Biden, said, “It’s a rather simple choice. Put in your lot with Russia, that is waging war against Ukraine, bombing women, children hospitals. Or find a way to work with Europe, with the U.S. and with Western democracies.”

Beijing’s need to salvage its relationship with Europe potentially now provides Europe with some unique leverage.

Its approach to China over the Ukraine crisis has been fragmented, however. While the bloc has united around warning Beijing against actively aiding Russia, EU foreign-policy chief Josep Borrell has repeatedly said China is the only country with the clout and relations with Moscow and Kyiv to broker a peace deal—an apparent endorsement of Beijing’s potential as a mediator that many in both Europe and the U.S. have dismissed.

EU officials and most EU member countries have still favored keeping lines open with Beijing in recent weeks, hoping to persuade China to press Moscow to approve humanitarian corridors for civilians in Ukraine and to explore a diplomatic off-ramp for the crisis.

Last week, when a senior Lithuanian official proposed canceling the EU-China summit “until we see which side China is on” in Ukraine, the pushback was swift.

“It’s important to keep communications channels open,” a senior EU diplomat said last week, noting the reports about China considering helping Ukraine.

Authors: Lingling Wei, Laurence Norman, Daniel Michaels, The Wall Street Journal