Delegation of the European Union to China

Ambassador Chapuis’ speech at World Peace Forum, Beijing

Beijing, 05/07/2021 - 11:56, UNIQUE ID: 210702_4
Press releases

Beijing, 4 July 2021

 

Dear Feng Zhongping, dear Zhou Hong, dear colleagues, ladies and gentlemen,

Thank you for inviting me this morning to this discussion on China-Europe relations. I will focus my remarks on three points:

  • EU-China relations are essential to the stability of the international system
  • The opportunities are not one-sided
  • The challenges need to be faced squarely

1/ The international system is under stress, with major shifts affecting the balance of great powers, the globalization process, and the future of multilateralism.

First, we have witnessed since the 2008 financial crisis major shifts within the international system. The 2020 COVID pandemic has accelerated the existing trends, with more unilateralism, less globalization, more nationalism, less internationalism; in my opinion, the most worrying development is the questioning of the rules-based international order in place since World War II, as if there was a positive alternative.

The European project, the one that led first to the European Economic Community and later became the European Union, to which 27 Member States delegate some critical national competencies in order to project internally and externally solidarity and influence, is based on the negation of conflict and the promotion of shared values and principles that support human development in all its components. It is firmly anchored in the United Nations system, with its three pillars on security, development and human rights. It has significantly contributed to multilateral institutions, like the international financial institutions, and the World Trade Organization. The EU is today one of the three top world economies, alongside the United States and China, followed closely by India. The EU is also the first international aid donor, putting its money where its mouth is. For these reasons, the EU has no interest whatsoever in confrontation, and its purpose, both internal and external, is to set and promote global standards of cooperation, ensuring fair competition and mitigating any form of adversarial relations.  In the regulatory sphere, this has been called the “Brussels effect”: as a recent study argues, “different from many other forms of global influence, the Brussels Effect entails that the EU does not need to impose its standards coercively on anyone—market forces alone are often sufficient to convert the EU standard into the global standard as multinational companies voluntarily extend the EU rule to govern their global operations[1].

The EU-China relationship is a significant illustration of this approach. In our latest strategic outlook on China in March 2019, we have set an ambitious agenda of partnerships, while seeking new agreements including in areas where there is competition and seeking to reduce the negative impact of systemic differences – the first step being to acknowledge the existence of such differences openly.

That is why we could say without hesitation that our relationship is essential to the stability of a rules-based international order, and that any attempt to disrupt this order would be in return detrimental to EU-China joint endeavours.

The recent sequence of high-level meetings these last two weeks (the G7, NATO, EU-US summits and the G20 Foreign Ministers meeting) took place under the shadow of US-China tensions. The fact is that, despite the change of the US administration, the relationship between the US and China continues to unravel, while in the rest of the world, the demise of Trump’s unilateral and coercive diplomacy has reopened the scope for multilateral and cooperative engagement. European Leaders, and the EU itself, do not share the view that confrontation is inevitable and that economic convergence and competitive neutrality with China are impossible. However, we see a significant risk of decoupling between the three top world economies, and this is indeed a source of major concern, not only for businesses, but also for governments.

What is at stake fundamentally is the assertion in China, as well as in Russia, that the rules-based international order is flawed, as if multilateral rules had not been negotiated, agreed and for decades accepted by all. This assertion is aggravated by the confusion between multilateralism, meaning rules-based cooperation in a global setting, and multipolarity, meaning relations between separated centres of power with adversarial claims to leadership, what the EU High Representative for Foreign Policy and Security has called “the return of the Empires”.  

Hence, from an European perspective, the international community is facing structural tensions that need a concerted effort to address, mitigate and overcome.  The EU-China relationship is an essential element in this regard.

2/ The opportunities presented by the development of EU-China relations are not one-sided, contrary to what is sometimes described in Chinese commentaries.

The history of EU-China relations since the establishment of diplomatic relations in May 1975 shows manifest deliverables. The CEIBS in Shanghai and the Law School in Beijing are flagships of higher education in global norms; the cooperation on intellectual property protection has delivered benefits to businesses facing rights infringement; the present projects on climate change, environment, biodiversity and energy show the joint leadership in these existential issues. Science and technology cooperation has reached unprecedented levels. And trade and investment flows have brought productivity gains, economies of scale, and impressive growth for our businesses on both sides.

The political conclusion of the EU-China Comprehensive Agreement on Investment (CAI) in December 2020 after seven years of negotiation demonstrated the common aspiration to create new opportunities for investment while rebalancing some of the most problematic asymmetries between our economies. This was a hard won effort, to the economic benefit of both sides. 

Yet, from an economic perspective, this draft agreement was criticized both in Europe and in China with conflicting arguments: for some, it was too little, too late; for others, compromises were excessive.

What strikes me most is the notion that we hear in China that the economic benefits related to European investments are one-sided, and that China just does not need this agreement. As if European factories in China do not create employment, as if the financial gains are not reinvested in the country, as if the technological know-how that is introduced has not fostered in-country innovation, as if the exposure of the Chinese economy to the global markets has not initiated high speed and high quality development, as if European businesses in China had not become what they are really: Chinese businesses with European ownership and management, who pay taxes to the Chinese government and who employ Chinese talents.

It is in the nature of business to make money, and it is in the interest of the host country to create appropriate conditions for these businesses to operate. Just this last Monday, the Chinese owned company Envision 远景 invested 2 billion Euros in northern France to create a factory of electrical vehicles batteries: isn’t that the evidence needed to support further flows between the EU and China?

Another critical dimension is the people-to-people relationship, without which EU-China cooperation would not be sustainable. The last forty years have witnessed an impressive surge of contacts, dialogues, student exchanges, academic interactions, touristic flows. It is a fact that Chinese studies have developed in Europe to an extent unimaginable a generation ago; the same can be said of European studies in China. For the last 18 months, the pandemic has severely impacted cross-border mobility and the question is when and how China will reopen in order not to lose the necessary and positive momentum of face-to-face exposure. We are all concerned that a protracted closure of China will not serve well the EU-China relationship, or China itself as a global power.

3/ The challenges facing the EU-China relationship are not new, but the time has come to deal with them with clarity in order to avoid further tensions.

Political differences between the EU and China are obvious. Since the policy of reform and opening up, these differences were mitigated by a shared will to explore all possible avenues of cooperation. This process led to building trust and to fostering a sense of convergence in multiple fields. Even on sensitive issues, we conducted different forms of dialogues, keeping channels of communication open, and accepting to agree to disagree when necessary.

However, we must face the fact that this political space of mutual understanding and of mutual trust has been negatively impacted during the last year or so. Is China challenging the political foundation of its relationship with liberal democracies in general, and with the European Union in particular? We note that it is negating any form of critical views on its domestic affairs, calling them “lies and fabrications”, and it is propagating the idea that this is part of an “anti-China conspiracy to instigate a colour revolution”; it is calling into question the universality of the values and principles inscribed in the United Nations Declaration of Human Rights; it is claiming that its governance system is, I quote, “superior”; its diplomacy has become, in some instances, not only assertive, but also aggressive, much to our dismay.  

We have come to a point where our political differences have become an obstacle to our undertakings. Sanctions and counter-sanctions imposed on 22 March create a new situation. What is the way forward?

A Chinese idiom goes by “qiu tong cun yi 求同存异”, seeking common ground while reserving differences. Another says, “zhi zhe qiu tong, yu zhe qiu yi 智者求同愚者求”, the wise seek common ground, the unwise seek differences. I would suggest that today both sides confirm their will to extend cooperation in all possible avenues, while addressing their differences in a way that is respectful of their respective political responsibilities. In the EU, the executive branch of government that conducts external relations is accountable to the parliamentary branch and requires its approval; human rights are not solely a domestic matter; and effective multilateralism implies that all nations sit at the same table with the same rights and accept peer review in a tolerant and constructive manner.

In conclusion, I think that the wisdom we have demonstrated in negotiating the CAI may be called up again to address squarely our political differences in order to consolidate the foundation of a remarkable relationship that has so well served both sides’ interests over two generations.

(end)

 


[1] Anu Bradford (Columbia University Law School), The Brussels Effect: How the European Union rules the World, Oxford, 2020.

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