The EU’s approach to China + Zelensky-Xi call + Italy’s MoU on the BRI

In this issue of the MERICS Europe China 360°, we cover the following topics:

• The EU’s approach to China: What happened to systemic rivalry?

• Zelensky-Xi call and China’s peace-branding – Proceed with caution

• Italy’s MoU on the Belt and Road Initiative: To renew, or not to renew, that is the question

The EU’s approach to China: What happened to systemic rivalry?

By Francesca Ghiretti

Recent visits of European representatives to China have rightfully placed much attention on diplomatic engagement and some on economic competition. The issue of systemic rivalry was largely ignored – with the exception of a few comments by European Commission President Ursula von der Leyen and German Foreign Minister Annalena Baerbock. During the first official visits in years amid growing tensions with China, it was an understandable omission of a touchy subject. But as the EU reviews its approach to China – currently a mix of re-engagement with von der Leyen’s proposed de-risking – it would be a mistake to marginalize systemic rivalry.

As a framework, de-risking does a great job of encapsulating the complexity of the relationship with China while avoiding polarizing narratives. It addresses difficult aspects such as managing strategic dependencies while seeking a more positive agenda of diplomatic engagement and collaboration. As such, de-risking is open to multiple interpretations and flexible applications.

A testament to its flexibility is the adoption of the term by a multitude of actors who have not always seen eye to eye on China. For example, Jake Sullivan, US National Security Advisor, in a speech at the Brookings Institution in April showed support for de-risking instead of decoupling. Regardless of the difference in approach towards China between Washington and Brussels, the term seems to appeal to both audiences.

Systemic rivalry was a new element in the European Commission’s 2019 Strategic Outlook on EU-China relations. Its three-pronged approach described China as a partner, economic competitor, and systemic rival. While de-risking seems well-suited to navigate in the context of partner and competitor, it is not as fitting for systemic rivalry.

One example is respect of the rule of law. While EU policies are carried out according to the rule of law, China has displayed a preference for the “rule by law”. The difference of a mere preposition is significant: rule of law means that the law sets the rules and enforcers follow them regardless of political or contingent preferences. Rule by law means that the law is used ad-hoc to pursue political objectives.

Systemic rivalry is thus important for the bilateral relationship. Europe’s identity is rooted in specific values and approaches that do not correspond to those of an authoritarian system such as China’s. It must be preserved when dealing with China in bilateral agreements, inbound or outbound investments, trade, or any other aspect of the relationship.

In addition, when dealing with third countries and in international fora, the differences between these two approaches cannot be marginalized. This means, for example, promptly condemning the invasion of Ukraine, respecting WTO rules, or including clauses on environmental and labor standards when financing a project.

While de-risking offers a much-needed pragmatic line to safeguard our interests, it implies that our differences with China result merely from fears about economic performance and/or technological advancement of the EU. That is already the lens through which Beijing views much of the pushback from the EU. But the systemic differences between the two matter in how the EU interfaces with China because each advances a different view of society and the world.