Europe’s co-operation with China is not business as usual

In recent months, China’s ‘One Belt, One Road’ (OBOR) initiative has become a major feature of Chinese foreign policy discourse. Cooperation with China nowadays has to be viewed within this framework, whether a country is located on the path of the continental ‘Silk Road Economic Belt’ or along the ‘21st Century Maritime Silk Road’.

Europe, standing at the endpoint of both ‘Belt’ and ‘Road’, is a logical focus point for greater co-operation with Beijing under this umbrella.

For China, Europe is primarily a market. The EU is China’s biggest trading partner ($467 billion trade in 2014, expected to grow to $650bn in 2020) and a major source of advanced technology. In terms of geopolitics, Europe is a potential counterbalance to American hegemony, even if Chinese observers seem to believe it is unrealistic to expect the EU to be a major pole in the world order anytime soon.

China is less comfortable with the EU’s normative power and with its embrace of values such as rule of law or civil society empowerment. Beijing has generally adopted a two-pronged approach to Europe and sought to exploit its internal divisions by mostly interacting at the bilateral instead of the institutional level in order to get more leverage for its own benefit. But this situation has recently evolved.

Over the last three years, China has started to engage Eastern European countries using a new type of platform that is neither bilateral nor European. The ‘16+1’ Framework, launched in Warsaw in 2012, includes five non-EU members (Albania, Bosnia-and-Herzegovina, FYROM, Montenegro and Serbia), as well as Bulgaria, Croatia, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia and Slovenia.

The fourth ‘16+1’ Summit convened in Suzhou in November 2015 identified several sectors for co-operation over the next five years, including transportation, agriculture and people-to people exchanges. Chinese Premier Li Keqiang indicated that China expected its companies ‘to be the main players in these projects’ and proposed a new ‘finance company’ to fund them.

Instead of simply dealing bilaterally with EU members as in the past, Beijing is now also pursuing new possibilities for economic engagement at the EU level. Here, the favoured buzzword is ‘synergy’. China has been quick to realise that the ‘EU Infrastructure Investment Plan’ (EU-IIP), also dubbed the ‘Juncker Plan’, announced in November 2014, would provide ample opportunities for reinforcing its own Belt and Road Initiative. The Europeans’ response has so far been enthusiastic. Both parties agreed in September 2015 to develop co-operation on investment and find further synergies between the OBOR and the Juncker Plan. The proposed increased co-operation between China and the European Bank for Reconstruction and Development also quickly came to fruition with China officially becoming a member in January. Finally, the EU and China issued a declaration on the development of 5G mobile networks, showing that both parties expect to harmonise their standards and develop common research in this domain. China insists on the commonalities between its own ‘internet Plus Strategy’ and the EU’s ‘Digital Agenda’. However, as some in Europe have begun to recognise, opening an increasing array of sensitive sectors such as information and telecommunications to Chinese investments could present some profound security risks.

China and Europe have been partners for so long that these latest trends might look like a natural continuation of an extended list of previous bilateral economic project developments. Yet, Europe’s co-operation with China under the ‘Belt and Road’ umbrella is not business as usual.

Times have changed. Europe today is weaker than ever before, assailed by unrelenting internal and external crises on political and socio-economic fronts. Meanwhile, China’s power and global ambitions are growing, and its leverage over Europe is getting stronger. Its Belt and Road initiative has more to do with a national grand strategy than an altruistic contribution to global public goods or the simple pursuit of economic gain. China’s overarching strategic purpose, which the OBOR is intended to serve, is its own unimpeded rise; with the inherent corollary demise of American hegemony. As the director of the China-Europe Academic Network, Wang Yiwei, recently wrote, the Belt and Road Initiative’s objective is to ‘help redirect the centre of geopolitical gravity away from the US, back to Eurasia’.

Viewed in this context, Europe’s co-operation with China within the OBOR framework has the potential to draw Europe closer to the Chinese gravitational field, and further away from the US. Desperate to boost its economy, Europe looks eager to soak up any investment China is willing to make for short-term gains, without considering the possible long-term geopolitical consequences. At the same time, Beijing’s approach to both Central and Eastern Europe is likely to create a further EU split along an East-West dividing line, with a potential 11-strong pro-China lobby in Brussels.

Already, the EU seems to be leaning increasingly towards granting China market economy status, despite US objections that it is still too heavily state-financed and centrally organised to deserve this designation. Several European countries have damped down criticism of China on issues such as human rights, even as their own citizens have been the victims of Beijing’s crackdown. These countries’ silent disavowing of their own fundamental values in order to not ‘provoke’ China is particularly worrying. Despite its own interest in preserving freedom of navigation in Asia, Europe’s position on this issue has been timid at best. There is a real risk that in the event of a crisis involving the US and China in the East or South China Seas, Europe would be deterred from siding with its transatlantic partner for fear of China’s reaction and possible use of economic leverage.

Gaining diplomatic influence from economic exchange is certainly not an easy task. But China is planting seeds for gaining influence and access in Europe, and along the entire Eurasian continent, that can be cultivated and used to achieve its own strategic ends. Whether or not they succeed, these efforts will have significant implications for Europe and for the Western liberal order of which it is a part.

Nadège Rolland is senior project director for Political and Security Affairs at NBR.

This article first appeared on Lowy Interpreter and is republished with permission.