When it comes to ties with China, European pragmatism trumps the US

PUBLISHED : Monday, 02 November, 2015, 2:05am
UPDATED : Monday, 19 September, 2016, 3:08pm

Europe is less vexed about its relationship with China than the US. As the fallout of an American warship testing Chinese territorial claims in the South China Sea was still reverberating last week, Dutch King Willem-Alexander had just left Beijing, German Chancellor Angela Merkel was on a two-day visit and French President Francois Hollande was preparing for this week's journey. The euphoria of President Xi Jinping's British trip was still fresh; the deals signed, warm words and promises made were aimed at making Britain China's European gateway for trade and investment. Although the nations do not speak with one voice on foreign policy, they are increasingly pragmatic in their approach to ties.

Economics plays a considerable part in China and Europe moving closer; each has what the other needs to boost growth. Trade was almost non-existent two decades ago, but has mushroomed to the point that the European Union is China's biggest trading partner, while China is the EU's second largest behind the US. During Merkel's visit, Premier Li Keqiang sought backing for a free-trade pact between China and Europe and support for internationalising the yuan. Among the deals signed was one for Chinese airlines to buy 130 Airbus aircraft.

China's "One Belt, One Road" initiative linking the nation to Europe via Asia makes plain its plans to develop markets and improve the reach of companies with investment and construction projects. EU governments have shown their desire to be part of the scheme through the Asian Infrastructure Investment Bank; 14 of the EU's 28 nations were founding members, along with non-EU partners Norway and Switzerland. The US stayed away and actively campaigned for countries not to join. It is understandable given American reticence about embracing China's rise that Beijing is turning towards Europe. Unlike the US, Europeans are less worried about Chinese companies working in key sectors.

Germany's slowing economy, the civil war in Syria and the European refugee crisis are cause for Merkel to turn to China. While the same matters are likely to be on Hollande's mind, his focus is believed to be on getting Chinese support for a UN climate deal in Paris in December. In the long term, good relations are vital for the interests of China and Europe, particularly in economic terms. They have differences that cannot be avoided, but being pragmatic is an essential part of ensuring mutual benefits.