The flags of the European Union (L) and China are in Berlin, Germany on June 20, 2023.
Sean Gallup | Getty Images News | Getty pictures
It is unlikely that China and the European Union will quickly become close allies.
“I don't see the EU and China against the USA,” said Max Bergmann, director of Europe, Russia and Eurasia at the Center for Strategic and International Studies (CSIS).
At the geopolitical level, the two powers could be open to more commitment, but economic clashes and existing questions related to trade and competition are a major hurdle, he explained.
“The potential for the economic orientation of the EU and China is limited because both export-oriented economies are and are therefore violent competitors, especially in the automotive and clean tech sector,” said Bergmann.
“I think there will be interest on both sides, but deep practical restrictions for both. If China is not ready to make some major concessions, I have difficulty combining the EU behind a strategy of deeper engagement.”
EU China voltages
The EU and China have a brittle relationship. While China is one of the largest trading partners in the EU next to the United States, economic relationships between the two have also been characterized in the past by investigations and tit-for-deed measures in connection with trade.
The EU has long claimed that Beijing subsidizes important sectors such as electric vehicles, batteries as well as steel and aluminum in a way that is harmful to global markets and competitiveness. Last year the EU CHINA met with tariffs on electric vehicles.
In the steps regarded as retaliatory measures, Beijing then started against pork and brandy against EU exports from the EU and an anti-subsidy investigation by EU milk products.
And it is not just the trade that causes tensions in the EU China relationship, Carsten Nickel, Managing Director at Teneo, told CNBC.
He added that there were “fundamental differences” between the two “regardless of what is going on with the USA” “
“This has to do with unresolved questions about overcapacity in China. It has to do with persistent concerns in the European Parliament, especially with regard to the human rights situation, and it has to do with concerns about China's support for Russia and Ukraine,” he said.
Ian Bremmer, founder and president of the Eurasien Group, also pointed out that there is a “deep” European distrust of China in areas such as intellectual property and technological surveillance and industrial policy.
This “does not disappear that the United States will become an opponent,” he told CNBC.
Attempts
However, China could try to take the opportunity to solve the US-EU compounds in order to build a closer bond with the EU, said analysts.
“China will in particular have the opportunity to break open the transatlantic alliance and to draw Europe closer,” said CSIS 'Bergmann.
On the other hand, some Europeans may imagine “securing security between the United States and China and perhaps to reduce their support for the Russian defense industry and open it economically,” he added.
China and the EU seem to have been drawn closer recently.
On Thursday it was reported that the two planned plans to set minimum prices for Chinese electric vehicles instead of the EU tariffs. Spanish Prime Minister Pedro Sanchez met Chinese President Xi Jinping in Beijing on Friday and then demanded a more balanced relationship. The Chinese Foreign Minister Wang Yi also attended Europe at the beginning of this year and campaigned for closer relationships and deeper cooperation.
At the beginning of this week, the President of the European Commission, Ursula von der Leyen, and the Chinese Prime Minister Li Qiang spoke by phone – although the EU chief “emphasized the critical role of China in combating customs duties”, and asked Beijing to work on a negotiated solution for the questions caused by Tariff.
The language that was used around the call from the European side appeared “softer” than in the past, according to Teneos Nickel.
Change forward?
Ultimately, however, Nickel says: “The focus is on the administration of this very challenging situation for the global economy.”
Nickel said that this does not mean that the underlying challenges in the European relationship with China have disappeared overnight.
The US tariff campaign could even make things between China and the EU more difficult, nickel suggested that it could worsen existing problems such as the overcapacity of the Chinese export.
Emre Peker Peker and Mujtaba Rahman of the Eurasia Group repeated this idea in a Thursday notice.
“Commercial diversions If the US China tariff's tariff fight escalates, the European Commission is prompted to use protective measures to prevent China's and other country quickly to empty their goods on the EU market,” they said.
Regardless of this, Trump tariffs will force Brussels to tighten his trade in Beijing, who go beyond the current efforts to counteract economic imbalances with China that threaten European industry, “said the analysts of the Eurasien Group.
At the same time, European political decision -makers will use “softer rhetoric” towards China to avoid that a trade war is triggered on two fronts. “However, it is highly unlikely that it translates into the Brussels cooperation against Washington,” she concluded.
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