Europe must keep engaged with China

Europe, China, and the US: a turbulent triangle

Victor Ângelo

 

European policy towards China requires a smart balance between respect for democratic values and economic interests. It is a complex issue that touches the daily lives of European citizens. You only have to look at the map of rail connections - 5,000 freight train journeys are expected in 2021 - or at the sea charts showing the routes of cargo ships to understand the interdependence between Europe and China. We need to import what we do not produce - or have stopped producing. The Chinese need our markets to ensure important levels of economic growth, one of the pillars of internal stability and regime continuity.

This interdependence has increased spectacularly since Xi Jinping came to power in 2013. It is part of his strategy. And the trend is for it to accentuate in the coming years. In addition to mutual investments and the increasing purchase by Westerners of Chinese stocks and treasury bonds, note that the economic corridor is more and more diverse. Some lines pass through Russian Siberia, others through Kazakhstan. Later, there will be a land link via Iran and Turkey, not forgetting the sea routes, which rely mainly on the ports of France, Italy and the Netherlands. The smooth functioning of this vast transit area requires a permanent political dialogue between the countries, which will have to be based on an understanding of mutual interests and perceptive pragmatism. To facilitate this dialogue and open a wider door, Europe should take the initiative to propose the creation of a consultative platform for the Eurasian corridor. Any disruption of traffic, for political or security reasons, would have a dramatic impact on the economy and people's lives, particularly in the European area. This tangle of relationships stems from the process of globalisation that began more than two decades ago. Anyone who thinks that the way in which the international economy is now organised can be significantly reversed is dreaming politics without having their feet firmly planted in reality.

The disruptions currently occurring here in Europe in the supply chains for raw materials or finished products produced in China and the escalating cost of transporting a container from a Chinese port to a European one already give us a bitter taste of what could happen if there were a serious disruption due to disagreement between the parties or the imposition of ill-considered sanctions. For example, before the pandemic, transporting a 40-foot container by sea from Shanghai to Europe could cost between $2,000 and $4,000. Now it has reached $17,000 and the waiting time can be up to several months. And this is despite the fact that Chinese container production accounts for more than 85% of the world's total. These problems may be temporary, the result of an acceleration of economic recovery in the more developed parts of the world and the pressure they put on shipping. Any European importer who needs made-in-China goods or components to maintain their manufacturing activities will be well able to explain the importance of a trade relationship without unnecessary hindrance. The more informed will also stress the need to avoid a further escalation of tensions in Taiwan and the South China Sea. This also applies to the Chinese side, which should not continue to pursue an escalation of offensive actions in these sensitive areas.

In a deeply interconnected world, one cannot think geopolitically and make strategic decisions following past models or seeing the world as a black and white scenario. The Americans have chosen a path of confrontation. On this side of the Atlantic, that option appears to be a dangerous choice and contrary to our interests. This is why Europe cannot and must not copy Washington.

(Automatic translation of the opinion piece I published yesterday in the Diário de Notícias, the old and prestigious Lisbon newspaper)

 

 

China and the international law

Today´s ruling against China by the Permanent Court of Arbitration, a Hague-based UN-related institution, should be noted as a milestone. It concerns one of the potentially explosive areas of the globe, the South China Sea. It recognises that China´s maritime claims to about 85% of that sea are not founded. Furthermore, the Tribunal stated that China has repeatedly violated the sovereign rights of the Philippines and caused considerable harm to the maritime environment.

This decision will have a serious impact on further developments in the region.

China has not accepted the ruling and will continue its policy of military control of the area. That will clash with the interests of the Philippines and also of the other neighbouring countries. It will also aggravate the naval and political tensions with the US.

But China will be on the wrong side of the international law. And it should be constantly reminded that as a Permanent Member of the Security Council it has special international responsibilities. These responsibilities start with respecting the UN-backed tribunals and their patiently worked out decisions.

Taiwan´s elections and post-electoral realism

The people of Taiwan voted heavily for the opposition, both in terms of the presidential and legislative elections. Opposition leader Tsai Ing-wen has been elected as Taiwan’s next president. She will be the first woman to lead the country.

In the past, Ms. Tsai was the leading Taiwanese negotiator with China. Therefore she knows how important is to keep the line open with Beijing, even if the majority of her support comes from those who would like to see Taiwan become an independent country. It is a fine balancing act that is required from her but political realism leaves no other option for Taiwan. Anything else would further complicate the tense situation that is already a key feature of the geopolitical situation in East Asia. 

Chinese politics of intimidation

The aim of the huge military parade the government of China will put on display tomorrow in Beijing, as they celebrate the 70^th anniversary of Victory Day against the Japanese, is obviously related to a policy of intimidation. 

But the ones the Chinese authorities try to intimidate are not based in Japan, not even in the neighbouring countries. To the neighbouring countries, Beijing´s message is clear: our military capabilities are growing by the day and modernising by the hour. It´s an arms race and the Chinese want it to be clear that they have the means and the knowledge to win the run.

Regarding the intimidation, the target is the Chinese people itself. Their government wants them to understand that the armed forces are a powerful instrument of power. It was used in 1989, at Tiananmen Square. And can be used again, now in a much more efficient manner. That´s the message. 

Civil obedience remains the key issue in such a vast country. The leaders are today, as their predecessors were, deeply afraid of any possible loss of political control.

Japan at the head of the G7

Japan will take over the leadership of the G7. That´s bad news for China, I presume. The tensions at sea in their part of the world will certainly gain a new emphasis during the next 12 months. And China will play the role of the villain. Several other players will appreciate it.

G7 in Brussels, a messy affair

Tomorrow Brussels will be hosting the G7 Summit. This was actually supposed to be a G8 thing. But the relations with the Russians being what they are now, we will only have seven of them in the room. The Russian ghost will however be there as well. That might be the main phantom. There will some others in the air: the banking and commercial tensions between Europe and the US, the lacklustre commitment of EU to collective defence, Syria, North Africa and, in the American minds, the growing armed instability in the South China Sea. All in all, including from a traffic perspective, Brussels will be messy.