Despite the overall trust in solid business exchanges, the survey results also indicate a lack of clarity about the overall trajectory of EU-China economic relations. Of the experts who do not think economic relations will maintain their current trajectory, roughly half expect business ties to improve and half that they will get worse. As the escalating trade row between China and Australia shows, systemic rivalry can hurt economic cooperation.
Indeed, Beijing’s coercive diplomacy is ranked as the number one issue that might burden EU-China relations in 2021. The Chinese government has already signalled that it does not plan to back away from “wolf warrior”-style diplomacy. In an interview to party-state media on January 2, Chinese Foreign Minister Wang Yi mapped out the country’s diplomatic priorities for the year and warned: “We accord friends with hospitality and partners with cooperation. But we also have to stand our ground when dealing with those who are not so friendly.”
What does this continued partner-rival dualism mean for cooperation? EU and Chinese government officials often cite global challenges – and particularly the Covid-19 pandemic and environmental issues – as fields in which Sino-European collaboration remains possible. These policy areas are key priorities as governments around the world continue to fight the coronavirus pandemic and prepare to meet twice at United Nations conferences in 2021 – first in Kunming and then in Glasgow – to discuss biodiversity and climate change.
Survey respondents are pessimistic about international cooperation in public health. No experts or members of the public surveyed see joint vaccine research and distribution as an area in which the EU and China can achieve a breakthrough. But survey respondents do hold some hope for climate policy, which has surpassed the EU-China investment deal as an area that could bring tangible results. About 30% of expert and general-public respondents think that Brussels and Beijing can work together to move towards the Paris climate goals.
The EU’s new tools – and putting them to use
While the EU is expected to continue treating China simultaneously as a partner and a rival, the bloc’s new tools to deal with Beijing’s multifaceted challenge could make a key difference in 2021. Last year, several European policy proposals at last began to be implemented – the EU investment-screening mechanism, for example, became fully operational in October and the global human rights sanctions regulation was approved by member states in December.
More proposals with implications for EU-China relations are in the pipeline in Brussels. For example, the EU is expected to propose new tools to address market distortions caused by foreign subsidies, an anti-coercion mechanism as a new instrument in its trade arsenal, and levies on CO2-intensive imports into Europe’s single market.
As the EU strives for a more sophisticated approach to China, the key will be to put these tools to use. The CAI gave a boost to the economic partnership between the EU and China. But survey respondents want the EU – which has committed to dealing with China’s systemic rivalry and promote liberal values – to do more than that and become a geopolitical player.
Asked about the importance of specific moves, survey respondents said the EU’s top priorities should be sanctions in response to Beijing’s human rights violations in Hong Kong and Xinjiang and the diversification of supply chains to reduce exposure to China. The EU might consider making sure such steps are taken in parallel to any towards more cooperation.