After Russia, Europe must wake up to China too

Europe’s real problem with China is not electric vehicles. It is the elemental vehemence of the Chinese Communist Party.

The European Union’s decision to impose tariffs on Chinese-made electronic vehicles was inevitable and correct—yet it solves nothing.

It was inevitable because, regardless of the outcome of the months-long investigation into Chinese subsidies, the United States had already slapped 100 per cent tariffs on Chinese EVs. Without swift action, Europe would have been flooded with even more EVs from China, damaging the efforts of domestically owned carmakers to compete.

The decision was the right one, tiering the tariffs according to levels of co-operation, transparency and state subsidy. BYD, which got off with the lightest price hike, will still be able to offload its Chinese-produced vehicles at prices much cheaper than equivalent European models and will be incentivised to expand its European production operations in Hungary and beyond. The European Commission thus made clear it was trying to protect European manufacturers without triggering an all-out trade war.

The United Kingdom, which is facing a change of government in three weeks’ time and so cannot take major decisions, faces a dilemma. Does it want to become the only remaining northern-hemisphere destination for cheap, Chinese EV imports or will it follow suit?

Yet, in the overall scheme of things, last week’s move solves nothing, because the real challenge facing the EU is to come up with a global grand strategy towards China, within which moves such as this can be coherently framed. But that is absent.

Invading Taiwan

For the whole of Europe, it is time to start defining trade policies towards China in the context of the geopolitical realities created by its president, Xi Jinping—not the economic story told in the years of his predecessor, Hu Jintao, when all connections between east and west were meant to be ‘win-win’. China is building an army and a navy designed to invade Taiwan, as stage one of a strategy to drive the US out of the western Pacific and as proof of concept that, for the rest of the century, ‘might is right’ in the Indo-Pacific region.

No one needs a degree in cryptography to work this out. US intelligence agencies believe Xi has set 2027 as the deadline to be ready to invade Taiwan and a US admiral told Congress back in 2021 that 2027 was indeed the likely scheduled date for aggression.

Last month China surged air and naval assets into Taiwan’s protection zones, declaring the military exercise ‘strong punishment’ for the island’s ‘separatist acts’. Meanwhile, pro-China opposition parties in Taiwan have pushed through legislation seen as weakening its capacity for self-defence.

In turn, the US foreign-policy community has become obsessed with the Chinese threat, even as the Ukraine war is consuming time, money and energy in Washington. In Europe’s worst-case scenario, Donald Trump returns as president and reallocates military resources away from the North Atlantic Treaty Organization to deter China in the Pacific. But even if Joe Biden wins again in November, the US strategic focus will turn primarily to China, posing the question point-blank for European policy-makers: do they want Europe to be a global power or a chessboard on which others play?

The range of implicit responses to that question paints a picture of division and incoherence in Europe’s stance towards China. Hungary and Serbia want to be its European proxies. Romania and Bulgaria want to be its strategic partners. Germany wants to be its critical friend. France desires European ‘strategic autonomy’ and will play the US off against China to achieve it.

Italy and Greece have each played willingly with the Belt and Road Initiative, handing key port infrastructure and stakes in iconic corporations over to China. Under Mario Draghi’s premiership however Italy slowed participation, before Giorgia Meloni stopped it altogether last year.

In Britain, meanwhile, the incoming Labour government will take the same basic view as its Conservative predecessor: it classifies China as a ‘strategic competitor’ at the level of hard power but as a potential collaborator on climate change and economic development. It promises a policy ‘that simultaneously challenges, competes against, and cooperates with China as appropriate’.

Power projection

In short, the absence of a clear European grand strategy or self-image of its place in the world has, in the 12 short years of Xi’s administration, made the continent a venue for Chinese power projection. We shall see how bad this idea was only if the worst happens. At the point China attacks Taiwan, every penetrated company, every bought academic, every proxy politician will rush into the public space to declare that ‘China is not our enemy’.

And in their own terms they might be right. If there is no coherent vision of strategic autonomy and technological sovereignty, and if so many European politicians, universities and companies are willing to be in hock to the Chinese Communist Party monpoly of power in Beijing, why would we expect this fractured continent to take a side in the defence of a country the EU does not even recognise?

For those of us who want a tougher line, it has to begin with a vision of Europe’s future in a world racked by great-power rivalries and the threat of war. Europe is a strong, industrialised continental economy, with democratic values that—including compared with those of the US—have proved the most resilient in the postwar era. As the rules-based order fragments, it is in Europe’s interest to remain part of the most open and multilateral version of the future that can be created.

Thus, strategic autonomy is a goal that has to be pursued within the framework of the existing western alliance system. Even if the whole EU cannot be persuaded to backstop America in its confrontation with China, it must show morally whose side it is on and place no obstacles in the way of European powers that wish to go further.

The most urgent and important problem is Russian aggression. But that is being fuelled and armed with Chinese technology: if Russia were to achieve a ‘frozen conflict’ in Ukraine, there is little doubt its army would be re-equipped by Beijing.

Wars of aggression

Like it or not, the so-called CRINK alliance (China, Russia, Iran, North Korea) has formed just as the late cold warrior Zbigniew Brzezinski predicted it would back in 1998—‘an “antihegemonic” coalition united not by ideology but by complementary grievances’. As the Ukraine conflict shows, and as Iran’s attack on Israel confirms, the direction of travel of that anti-hegemonic coalition is towards wars of aggression.

So it is time for Europe—and I include my own country, Britain—simply to wake up. Whether it slaps 15, 38 or 100 per cent tariffs on Chinese EVs doesn’t matter: when the aggression happens the trade will stop. So the difference between ‘derisking’ and ‘decoupling’ Europe’s economy from China’s is academic. Everything Europe does has to be framed by the deteriorating security situation, the basic untrustworthyness of the CRINK leaderships and their propensity to use external force as a ‘solution’ to domestic instability.

What Europe needs to do today—and should have done many yesterdays ago—is to build a state-backed, European-controlled, resilient EV sector. It needs to construct industrial and soft-power alliances across the Indo-Pacific, even as it focuses its own defence spending on deterrence against Russia. From science to silicon-chip production it needs to relearn state direction.

And it needs politicians and administrators who understand that, even if China is not our enemy, it is not exactly behaving as our friend.

This is a joint publication by Social Europe and IPS-Journal