Covid-19 Apr 29

Coronavirus trouble brewing behind EU-China ties

EU criticism is mounting over China's perceived opportunism and propaganda about the global virus crisis

by David Hutt
Coronavirus trouble brewing behind EU-China ties
 China, EU relations are fraying over Beijing's handling of the coronavirus crisis. Image: Twitter/Axios

When European Union (EU) officials allegedly delayed and then rewrote a report on China’s state-sponsored Covid-19 disinformation campaign, it represented Beijing’s latest strong-arm attempt to control the pandemic’s narrative.

The Financial Times reported that Chinese officials warned EU politicians at least three times and even threatened bilateral relations if the EU publicly criticized Beijing for spreading propaganda about the pandemic’s origin and China’s response to it’s initial outbreak in the city of Wuhan.

“The Chinese are already threatening with reactions if the report comes out,” Lutz Güllner, head of communications at the European External Action Service (EEAS), the EU’s foreign service, wrote in a letter to colleagues quoted in media reports.

When the report was finally published on April 24 in the form of a summary of Covid-19 related events, European politicians claimed it left out detailed criticism of China’s pandemic propaganda that were included in previous versions of the report.

'Bowed to Chinese pressure'

“We are revolted by the reports revealing that the … EEAS bowed under Chinese pressure and modified its findings about the Chinese disinformation campaign on Covid-19,” Sandra Kalniete, a member of the European Parliament and vice-chairwoman of the center-right European People’s Party grouping, said in a statement. 

Spokespeople for the European Commission, the EU’s executive, have denied they watered down the report. But the controversy comes as EU-China relations have arguably hit their lowest point in decades, chiefly over Beijing’s handling of the coronavirus crisis.

In mid-April, the French foreign ministry summoned the Chinese ambassador to Paris for a private dressing down after the Chinese Embassy reportedly published online posts claiming that French nursing home workers were “abandoning posts” and leaving “residents to die of hunger and disease.”

Around the same time, British Foreign Secretary Dominic Raab said there could no longer be “business as usual” with China after the pandemic. The comment may have been motivated by an open letter several senior politicians from the governing Conservative Party wrote to Prime Minister Boris Johnson calling for a “rethink” of UK-China relations.

The European Union and China have an increasingly complex and conflicting relationship. Photo: Facebook

Sweden gets tough

This month Sweden closed down all of the Confucius Institutes, China’s state-run language and cultural institutes, active in the country, the first European state to do so. Meanwhile, several Swedish cities ended their twin-city agreements with Chinese cities, including the country’s second largest city Gothenburg’s ties with Shanghai.

Aside from China’s disinformation campaign, which has reputedly bid to denigrate Europe’s responses to cast its own in a more favourable light, there is rising ire over Beijing’s medical equipment donations and contributions to virus-hit EU members.

Covid-19 test kits sent by China to several European states, notably Spain, have proven to be faulty and substandard, while criticism has also centered on Beijing’s sale of medical equipment to EU states after many had donated them to China when it was the epicenter of the virus outbreak in January and February.

'China has lost Europe'

“Over these months China has lost Europe,” Reinhard Buetikofer, a German Green party lawmaker who chairs the European Parliament’s delegation for relations with China, said in media reports earlier this month.

That sentiment tracks with opinion polls in America, where Covid-19 deaths have surpassed 58,000. A Pew Research poll released this week shows that the percentage of Americans with an unfavourable opinion of China rose to 66%, up from 47% last year, and the highest since the pollster began asking the question 15 years ago.

No up-to-date poll has been published on the views of Europeans, though a Pew Research poll conducted last year found Czechs and Swedes to hold the least positive views of China.

One recent poll commissioned by the Henry Jackson Society, a British neoconservative foreign affairs think tank, found that 80% of Britons want their government to demand an international inquiry into China’s handling of the crisis, while 71% said London should sue Beijing for Covid-19 damages.

US politicians seek to hold China financially and legally accountable for the Covid-19 pandemic. Photo: Facebook

A war of words were sparked earlier this month after Germany’s largest newspaper, the tabloid Bild published an article under the headline “What China owes us,” asserting that Berlin could demand as much as €150 billion (US$162.7 billion) for damages caused by the pandemic.

The Chinese embassy in Germany responded in an open letter accusing the newspaper’s editor-in-chief, Julian Reichelt, of “nationalism, prejudice, and hostility against China.” Reichelt responded in turn with an even more scathing critique of the Chinese Communist Party.

As US-China tensions escalated in recent years, especially after US President Donald Trump took over the White House in early 2017, the EU and major European states have tried to carve out something of a “third path” between the two superpowers.

At the same time, however, the EU has tried to sound more assertive vis-à-vis China. The EC described China as an “economic competitor” and “systemic rival” in an official paper released early last year. Around the same time the influential Federation of German Industries also dubbed China a “systemic competitor.”

European 'naiveity'

French President Emmanuel Macron war, meanwhile, warned last year that the time of European “naiveity” of China was over; he more recently said it was “naïve” to think China handled the coronavirus crisis better than European states.  

When Macron met with Chinese President Xi Jinping last year, he made a point of inviting other European leaders to what was usually a bilateral summit, a sign that Europe needs to be unified amid growing superpower tensions.

Yet most analysts reckon it’s unlikely that even after the coronavirus crisis the EU will be able to agree to a unified position on China. And it’s even less likely that Brussels will engage in the sort of antagonistic contest with China that the US has under Trump.  

Europe’s rising frustration with China will more likely be expressed in the economic realm.

2020 was supposed to the year that pen was finally put to paper on an EU-China investment pact. But the agreement, which was already being negotiated at a snail’s pace, has been put on hold due to the pandemic.

German Chancellor Angela Merkel welcomes China’s President Xi Jinping to the G20 summit in Hamburg, Germany, July 7, 2017. Photo: AFP/ Odd Anderson

It’s unclear whether a hyped special summit in Leipzig, Germany, in September where Chinese President Xi is expected to meet EU heads of government and leaders will still go ahead.

Clemens von Goetze, the top German envoy in China, told Caixin on April 25 that “against the backdrop of the economic impact of Covid-19, a breakthrough” in the EU-China investment deal “is more urgent than ever.”

However, many analysts think that an EU-China investment treaty is now even less likely to be agreed this year, and new concerns about how much Europe is dependent on China’s economy could put another spanner in the works.

Phil Hogan, the EU’s trade commissioner, said in April that there needs to be a debate in Europe “on what it means to be strategically autonomous”, a comment that signalled a possible lurch towards more EU protectionism after the pandemic.

He added that discussion should focus on building “resilient supply chains based on diversification [and] acknowledging the simple fact that we will not be able to manufacture everything locally.”

'Decrease dependence on large powers'

French Finance Minister Bruno Le Maire said earlier this month that there will be “a ‘before’ and an ‘after’ the coronavirus [outbreak] in global economics.”

He went on to say “we have to decrease our dependence on a couple of large powers, in particular China, for the supply of certain products” and “strengthen our sovereignty in strategic value chains.”

Germany, which has long been accused of being soft on authoritarian nations including Russia, is also accused of prioritizing domestic interests in doing business with China over EU concerns of a unified stance.  

In March, analyst Noah Barkin noted in an article for Carnegie Endowment for International Peace, a think tank, that German Chancellor Angela Merkel’s government’s “reluctance to antagonize Beijing risks undermining the EU’s push for a common policy toward China and perpetuating a situation where member states look out for their own interests, often to the detriment of a common European front.”

Barkin also wrote that Germany’s “wake-up call” about China came in 2016 when China’s Midea Group paid $5 billion to purchase Kuka, a German robotics manufacturer. When no other non-Chinese firm could be found to rival the bid, it went through.

But the following year, Washington successfully pressured Berlin to stop an already-agreed Chinese takeover of Aixtron, a German chip-maker whose technology was used in America’s Patriot missile defense systems.

Restrictions on foreign takeovers

In 2019, several European governments and the EU introduced new measures to prevent foreign takeovers of strategic and vital European firms, mainly those in the technology sector. Those restrictions could be expanded in light of the coronavirus crisis.

Washington has spoken firmly about the need for more decoupling of its supply chains from China, while the Japanese government has recently offered financial help to its firms that seek to relocate back home from China.

European governments may or may not seek to urge firms to relocate their supply chains out of China, but they will almost certainly implement measures to prevent Chinese firms from buying up virus-hit, financially-distressed European companies.

Many European economies are expected to slip into pandemic-caused recessions this year, a downtrend that will put financial pressure on many European firms to seek new outside investors.  

However, Margrethe Vestager, the EU competition commissioner, suggested in a Financial Times interview in April that European states should even consider buying stakes in their struggling domestic firms to prevent the “threat” of Chinese takeovers.

This story appeared first on Asia Times