Beijing should remain calm in the face of a new EU-US trade and technology pact to overcome competition from China, as the interests between Washington and Brussels are still misaligned, according to experts. “The transatlantic tech council may foster better cooperation on standards, which is important, but in other areas it will probably just be a talk shop,” said Douglas Fuller, an associate professor at the City University of Hong Kong. “Hard to have deep cooperation when interests are not fully aligned.” US President Joe Biden and European Commission President Ursula von der Leyen launched in Brussels on Tuesday the EU-US Trade and Technology Council, which will serve as a forum for the two sides to coordinate on removing trade barriers, setting global standards and promoting joint innovation in key technologies. The council, however, is not enabled with legal teeth or necessary authority to enforce sanctions. It marked the latest salvo against Beijing on Biden’s recent European tour, which had seen him succeed in rallying support from the Group of Seven richest nations at their summit in Britain and the North Atlantic Treaty Organisation . The new trade and tech pact between the EU and the US came about three weeks after Washington and South Korea agreed to deepen their alliance to include expanded regional coordination on law enforcement and cybersecurity, as well as promoting greater connectivity and fostering digital innovation within the Association of Southeast Asian Nations . Still, experts indicate that the US push to alienate China in global value chains or to deny the world’s second-largest economy of access to advanced technologies will be a tough task in light of the country’s close integration in global trade and investment flows. China, the world’s second-largest economy, remains one the biggest markets for a long list of products, ranging from consumer goods, smartphones and semiconductors to telecommunications gear, aircraft and hi-tech manufacturing equipment. While Washington’s allies in Europe and Asia may share the Biden administration’s uneasiness about China’s aggressive initiatives in trade and hi-tech activities, it would be hard to persuade them to sever major bilateral deals with China or shun its vast consumer market. These allies, especially in the Western bloc, may not have the same incentive as the US in decoupling from China, according to Wei Jiang, a professor at Columbia Business School. “My prediction is that [the Western bloc] will go in the direction [of decoupling], but it’s unlikely to go all the way,” Wei said. “[Having] complementary economic relations is still the dominant consideration for those countries.” G7’s ‘unprecedented’ united front piles pressure on China, analysts say Other analysts see China as having many advantages in its trade and tech rivalry with the US, especially around the latest cutting-edge technologies. “The reality is that today when it comes to AI , 5G and EVs , along with its mainstay chip supply chain … in Asia, the tech power race has clearly tilted towards Beijing,” said Daniel Ives, managing director for equity research at New York-based Wedbush Securities. Ives indicated that this ongoing “cold tech war” presents many risks for large American companies, including electric carmaker Tesla and tech giant Apple, which have substantial operations in China, the world’s biggest market for cars and smartphones. China has already given notice to its major economic trading partners about joining US-led coalitions. Chinese Foreign Minister Wang Yi, in a phone call with his South Korean counterpart Chung Eui-yong last week, warned Seoul about becoming involved in Washington’s Indo-Pacific strategy. City University’s Fuller, however, indicated that some aspects of the latest US efforts to bolster alliances overseas could help contain China. “The allies will generally agree not to ship the most advanced tech already on the Wassenaar list to China,” he said. “Some of these countries may not say that is what they are doing, but they will do it.” Established in 1996, the Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies is a multilateral export control regime that promotes transparency and greater responsibility in transfers of technology. “For example, I expect the Netherlands will never say that they absolutely will not ever sell EUV litho to China again,” Fuller said, referring to the extreme ultraviolet (EUV) lithography equipment used in advanced chip fabrication. “Under the four years of Biden, they won’t sell it.” The market for advanced machines needed by Chinese companies to make high-end semiconductors has long been dominated by the Dutch company ASML. But ASML has been unable to sell its EUV lithography equipment to companies like Semiconductor Manufacturing International Corp, mainland China’s largest chip foundry, since 2019 because the Netherlands government has denied the company a licence for such a transaction. In April, ASML chief executive Peter Wennink said export controls against China will not only fail to halt its technological progress, but also hurt the US economy. Biden’s East Asia nominee says China is ‘biggest geopolitical test’ for US City University’s Fuller said China will not have cutting-edge chip fabrication plants during the Biden administration so long as current export controls hold. With interests not fully aligned, the US is not expected to see much deeper cooperation beyond current agreements, according to Fuller. “Taiwan and South Korea want to keep [semiconductor] production onshore,” he said. “The US, EU and Japan want to reshore production. They can agree not to sell the most advanced tech to China, but agree on little else.” In May, Taiwan Semiconductor Manufacturing Company Co, the world’s biggest chip foundry, joined a new lobbying group dominated by top American chip developers and users, in a move that may make it harder for China to wean itself off a US-led global semiconductor supply chain . “Whatever technology arrangements the US makes with Europe and South Korea, it will need to compensate [allies] for the cheaper parts and products from Chinese vendors,” said Victor Shih, an associate professor of political science at the University of California, San Diego School of Global Policy and Strategy. How Trump won over Europe on 5G, cutting China out To be sure, the exclusion of Huawei Technologies Co and ZTE Corp from supplying their 5G gear to major telecommunications network operators across Europe shows that the US does not need a high-level council to push its anti-China agenda. The Trump-era 5G foreign policy strategy started with smaller, Eastern European and Baltic countries, then moved last year to bigger countries like France and Britain. This is likely to continue under Biden. Commenting on the new EU-US pact, Zhu Yun, an associate professor in economics and finance at St John’s University in New York, said that initiative relies on how much Brussels can trust Washington’s policies to continue, which could lead to new geopolitical moves. “A stronger transatlantic partnership may further push Moscow to Beijing ,” said Zhu, without elaborating.