Czech Senate chairman Milos Vystrcil, left, handed Silver medal of Senate chairman to Taiwanese Foreign Affairs Minister Joseph Wu, right, on October 27, 2021, in Prague, Czech Republic.
MERICS Europe China 360°
17 min read

Taiwan + Climate cooperation + Global Gateway

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

  • The EU’s Taiwan push – a reality check
  • China Debates: After COP26, what’s next for EU-China climate cooperation?
  • EU’s Strategic Compass can offer new assertive tools on China
  • Waiting for Global Gateway, the EU’s answer to China’s Belt & Road Initiative

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Analysis: The EU’s Taiwan push – a reality check

By Grzegorz Stec

Multiple European actors have recently shown increased support for engagement with Taiwan. The European Parliament and national MPs held meetings with the Taiwanese Foreign Minister, a Taiwanese trade delegation toured Central and Eastern Europe, while the European Parliament and Commission released policy documents linked to EU-Taiwan relations.

Increased engagement with Taiwan comes at a time of heightened tensions between Brussels and Beijing, and as many European stakeholders come to realize the importance of Taiwan in global semiconductor production.

Considering the differences between the range of EU actors, an increase in engagement is unlikely to constitute a strategic shift in an EU-wide approach to Taipei even if it brings new quality to EU-Taiwan relations.

Legislators-led engagement

In practice, European legislators led many of the interactions. It is the MEPs that are requesting politically significant gestures of engagement and who called on the Commission and Council to explore a Bilateral Investment Agreement with Taiwan. It is also national MPs that met officially with Taiwan’s Foreign Minister Joseph Wu and led delegations to Taipei. In contrast, the Commission and member states’ capitals, with a notable exception of Lithuania, have been more reluctant to openly engage with Taipei in politically sensitive formats.

While the European Parliament and legislators play an important consultative role in the foreign policy making, ultimately it can only be shaped by a consensus of national governments and, to a certain degree, the European Commission.

Central and Eastern European countries – Taiwan’s Trojan horse?

Among the member states, a few Central and Eastern European (CEE) countries have been at the forefront of engaging Taiwan, namely Lithuania, the Czech Republic, Slovakia and, to a lesser degree, Poland. Over the summer, they provided Taiwan with vaccine donations, more recently welcomed Joseph Wu during his European tour (albeit unofficially in the case of Poland) and signed memoranda of understanding on boosting economic cooperation with the Taiwanese trade delegation. Lithuania also moved forward with opening the Taiwanese Representative Office in Vilnius, a decision which has been a subject of major pushback by Beijing.

Such interest from member states to boost ties with Taipei stems from their position. Given the limited economic links with China, estimated to be a source of less than one percent of overall FDI in the region and a destination of less than two percent of CEE member states’ exports, they face limited risk of Beijing’s retaliation. At the same time, some CEE states are drawn to Taiwan’s experience of overcoming a middle-income trap and consider Taiwan’s economic offers to be attractive; especially given the successful operations of Foxconn, Acer and Asus in the region. What’s more, CEE countries share the similar experience of being in the shadow of a larger authoritarian neighbor and of relying on the US for security.

The pro-Taiwan course may further intensify in some CEE countries in the coming months, for example elections in the Czech Republic brought a more Taiwan-friendly Prague and the potential success of the opposition next year in Hungary may facilitate a shift in Budapest’s policy.

Major adjustments of Taiwan policies require broader EU consensus

While recent EU-Taiwan developments provide positive momentum for expanding relations, any major adjustment of the EU’s Taiwan policy requires a broader consensus. It is unlikely that enthusiasm exhibited by the CEE states will be replicated by other EU members –including France and Germany. These actors have much more to lose from straining relations with Beijing and fewer potential rewards to reap.

The Commission is unlikely to emulate the European Parliament’s approach of publicly engaging Taiwan to showcase international support for the island. Also, the current buzz in Brussels and several EU capitals around “re-engaging” China does not set a precedent to revise their position on Taiwan. An indication of a potential shift would be support from the Council and the Commission to explore the BIA with Taiwan.

The DG Trade has, however, consistently described BIA as lacking economic basis and just recently delayed the announcement of a new format for discussing economic and tech issues with Taipei. This could be motivated by Brussels’ and several EU capitals’ ambition to “re-engage” China. European Council President Charles Michel’s recent public support for the Comprehensive Agreement on Investment and his ambition to organize EU-China Summit by the end of the year signaled a similar intention. Therefore, the circumstances do not to create enough momentum to revise the EU’s position on Taiwan.

For now, there appears to be EU-wide consensus outlined in the Indo-Pacific Strategy in which Taiwan is mentioned regarding semiconductors, trade and investment, data protection and sustainable fishery as well as a worrying increase of tensions in Taiwan Strait. We may expect targeted engagement with Taiwan, exploring the boundaries of the EU’s “One China policy” through second tier initiatives such as the Indo-Pacific Strategy, Global Gateway or European Chips Act. In turn, this will elicit discussion on where European actors will draw the line on Taiwan, but this is bound to take place behind closed doors.

Read more:

China Debates: After COP26, what’s next for EU-China climate cooperation?

The lead up to the world climate conference COP26 was dominated by the question of whether President Xi was going to show up in person and whether China would make any major pledges: both can now be answered with a disappointing no. Back in the PRC, public intellectuals remain largely in line with official pronouncements. They argue that any pledge that requires going beyond the 2015 Paris Agreement pledges is currently unrealistic, China is used to under-promising and over-delivering and the West should do more to help the developing world. Some experts also expressed frustration that, even on environmental issues, Chinese efforts are criticized more than they are commended.

Although such discussions set an unfavorable tone, the prospects for EU-China cooperation on climate change are brighter than often expected. As the experts’ quotes show, there are still areas in which political breakthroughs remain possible and EU-China environmental cooperation is certainly one of them.