Wen Jiabao

Political weapon

PUBLISHED : Tuesday, 27 September, 2011, 12:00am
UPDATED : Tuesday, 27 September, 2011, 12:00am

Keep an eye on the European Union's arms embargo on China. As the region digests the impact of Premier Wen Jiabao's historic speech this month to the World Economic Forum in Dalian, it is the economic impact on China's relations with a troubled Europe that has obviously snared the headlines. Wen appeared to shift the traditionally suspicious relationship into a new realm of hard-boiled quid pro quo as he offered a 'helping hand' but urged both the Europeans and the US to get their houses in order.

Just as the extent of Chinese financial support to the euro zone remains opaque, so does the political price beyond Wen's specific demands for Europe to declare China a market economy - a move that would end EU action against the dumping of subsidised Chinese products.

If there is one issue that is stubbornly raised whenever Chinese envoys meet their EU counterparts, it is the embargo on Chinese access to Europe's extensive weapons industry - a legacy of the Tiananmen crackdown in 1989. While a lifting of the ban would undoubtedly boost a rapidly modernising and expanding People's Liberation Army - even though mainland scholars note the way the long years in the cold have forced China to stand on its feet - it also carries political and diplomatic weight.

The issue flared late last year and brought the battle lines into sharp relief. A leaked document by Catherine Ashton, the EU's High Representative for Foreign Affairs and Security Policy, called for the EU to 'design a way forward', noting that the lifting of the embargo on all lethal weapons could 'happen very quickly'.

In Beijing, foreign ministry officials noted that the embargo had severely affected Sino-EU political trust, saying that China had long warned that it was 'completely out of sync' with the evolving strategic partnership.

The leaking of the strategic paper forced some discreet back-tracking from EU security officials amid quiet yet forcefully expressed worries from the US and Japan. There was neither a timetable nor concrete plans - or, significantly, a consensus among the EU's 27 members - officials noted.

Amid the broader questions over the EU's economic future, it will be very interesting to watch that lack of consensus over the next year. Amid the earlier flurry, some traditional opponents within the EU nevertheless acknowledged that the embargo's days were probably numbered. A British Foreign Office spokesman, for example, said at the time that while Britain believed the time was not right, the issue 'should rightly remain under review'.

A few months on and a range of diplomats note that the basic positions haven't shifted, but some privately warn that the European political theatre is changing amid recent pressures and old assumptions are perhaps not as solid as they once were.

Japanese strategic analysts, fearing the sale of dual-use technology that could quieten China's expanding fleet of submarines, are already scrutinising developments. 'It's not a question of if China will play the embargo card again, but simply when,' said one senior Tokyo envoy.

Greg Torode is the Post's chief Asia correspondent.