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“Third way”: EU tries to avoid a hard choice between US and China

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According to Euronews, the EU-China online summit of June 22 “was held in a tense atmosphere.” The EU has toughened its position on trade negotiations with Beijing, but observers note that Brussels continues to stay clear of the ongoing trade war between the US and the People’s Republic. Meanwhile, just as President Trump talks about “breaking ties” with the Celestial Empire, the United States is pulling out of OECD-organized negotiations over an international tax on digital companies above a certain revenue threshold. US Trade Representative Robert Lighthizer is looking for legal grounds for imposing unilateral duties on the European countries willing to jack up taxes on US IT companies. The situation may well lead to a new trade war.

By the turn of this year, Europe had still been desperately trying to walk the fine line between Washington and Beijing and implement its own version of the game in a world where parties can always agree or nix almost any bilateral deal. When in Washington, the European Commission backed the US side in the conflict with China, while during a visit to Beijing its delegation showed “understanding” of China’s position in trade disputes with America. However, even then, the Old World’s stand on the intensifying tug-of-war for dominance between the world’s two leading powers looked both ambiguous and “dangerous.”

The US wants the Europeans to clearly and unambiguously honor their political and even legal obligations, threatening otherwise to completely dismantle the entire system of relations, which has for decades relieved Europeans of the need to make independent, albeit difficult and costly decisions. Trump’s unilateralism has exacerbated the crisis in transatlantic relations to a degree that the concept of “Westlessness” took center stage at this year’s security conference in Munich. It was about the erosion of Western power to an extent that “the very concept of” the West “is now devoid of any strategic content.”

Meanwhile, China’s rapid economic, technological and political growth is forcing Europeans to decide whether they want to trade and exchange technologies with a possible future leader in many important areas of scientific and technological progress. And, ultimately, if the Old World is able to maintain its status of one of the most advanced socio-economic regions of the world.

Finally, while over the past few years the United States has become increasingly self-absorbed, Europe and China have been aligning their positions on global trade, including their rejection of Washington’s growing protectionism, and on climate change. Beijing has made it clear that in the event of a weakening of transatlantic ties, it is ready to immediately move in and fill the gap.

It is against this backcloth that towards the close of last year the number of European politicians holding out for Europe’s greater strategic autonomy from the United States reached a historic maximum. Optimists see the future of the European Union as a “counterweight” to the United States, should the latter “cross the line.” The new leadership of the European Commission has proposed the creation of a full-fledged European “center of power” to interact with the rest of the world, the US included, but with an emphasis on rational political interests.

At the same time, the Europeans are wary of the increasing centralization of political power in China under Xi Jinping, the state’s growing role in the economy and Beijing’s increasingly “assertive” foreign policy. By the end of 2019, the EU had gradually tightened control over Chinese investments, especially in the high-tech sector and infrastructure, but described all this as “regrettable but necessary measures” designed to create a new political platform for the development of closer ties.

However, in a matter of just a few weeks the coronacrisis forced the EU to start reconsidering its strategic worldview. First, the pandemic called into question the efficiency of supranational institutions as such – both in terms of legitimacy and the resources they are able to use to combat the challenge of catastrophic proportions. Amid the ongoing COVID-19 crisis, the “failure of the US global hegemony” has become “painfully obvious.” Finally, even before the pandemic struck, Britain’s withdrawal had deprived the EU of much of its “strategic weight.”

As for relations with China, Mark Leonard, Director of the European Council on Foreign Relations, said that the EU now sees Beijing’s strong desire to use its position as a leading producer of medicines and medical equipment as a means of increasing its political leverage. “The COVID-19 crisis has triggered a new debate within Europe about the need for greater supply-chain ‘diversification,’ and thus for a managed disengagement from China.”

That being said, right now the EU’s dependence on China “in strategically important areas” has actually increased. Diversifying sources of supply will not be easy. Experts argue that it would be crazy for a business to leave China, especially when it produces goods that are extremely important for the Europeans, such as pharmaceuticals and medical equipment. They also warn that producing all this in Europe and procuring in other countries, would cost more.

On the other hand, the outbreak of the epidemic has created preconditions for a new rapprochement between the United States and Europe. Still, the outbreak of the coronavirus infection on both sides of the Atlantic has been strong enough to force nominal allies to fight each other for resources. It is “every man for himself” now. The situation with the pandemic and its socio-economic impact on the United States is so bad that it is now undermining Donald Trump’s chances for reelection in November, forcing him to look for ever new ways to appease and rally his voters, even at the cost of slapping new tariffs on America’s closest allies. Bloomberg reports that in response, “Germany is preparing to strike back against the US if President Donald Trump follows through on his threat to kill off the Nord Stream 2 gas pipeline with additional sanctions.”

Strategically speaking, however, the EU and the US continue to have shared concerns in their confrontation with Beijing, including alleged theft of intellectual property, “forcing” private Western companies to transfer technology, industrial subsidies and violations of market rules by China’s state-owned firms. Speaking at a June 25 online conference, organized by the German Marshall Fund, US Secretary of State Mike Pompeo said that Washington had accepted a proposal by European Union foreign policy chief Josep Borrell to create a US-EU dialogue on China to discuss “the concerns we have about the threat China poses to the West and our shared democratic ideals.”

In a recent interview with Euronews, NATO Secretary General Jens Stoltenberg said that “… China is coming closer to us with weapons systems … the rise of China makes it even more important to maintain the bond between North America and Europe, the transatlantic bond.”

The EU remains formally committed to developing a “strategically- oriented foreign policy” that would give it “a sense of initiative and action.”

 “We grew up in the certain knowledge that the United States wanted to be a world power,” German chancellor Angela Merkel told parliament in June. “Should the US now wish to withdraw from that role of its own free will, we would have to reflect on that very deeply,” she added. French President Emmanuel Macron urges Europe to act more independently in world affairs in order to completely get rid of the need to choose between America and China. This is exactly what the EU’s top diplomat Borrell has in mind when he speaks about a “third way.”

Still, what has been discussed so far is at best preparation of documents to serve as a “strategic compass” for coordinating government measures.

Systematic inability to reach political and procedural consensus on many pressing international issues is the Achilles heel of EU foreign policy. The past few years have seen a rapid decline in the overall level of public confidence in traditional European elites, which has inevitably weakened the potential of political leadership across the EU. Besides, the growing sense of uncertainty among the leaders of individual EU countries is by no means adding to the unity of the 27-member bloc either.

On the one hand, the pandemic has “allowed Europeans to become less naive and more united in the face of Beijing, which supposedly tries to set them apart.” On the other hand, in its relations with the United States, Europe has found itself in a situation where it will have to try hard to make sure that America does not lose interest in continuing any “special” relations with Europe. Overall, the EU’s internal weakness and fragmentation, exacerbated by the current coronavirus pandemic, threatens to push the “united Europe” to the periphery of world politics.

According to most forecasts, tensions between the US and China are set to grow. Moreover, the old bloc system is actually a thing of the past now. The EU’s position will be determined by the severity of the humanitarian, financial and economic impact of the epidemic. It will also depend on whether the “soft power” of Europe is not accompanied by a “hard” one. The EU’s foreign policy has to maneuver between a mix of unenviable geopolitical roles of serving as a “buffer zone” in the new Cold War between China and the US, and of someone who has “dropped out of history” due to the loss of “identity and philosophy.” Europe will not be able to return to the “table of the great powers” unless it finds answers to these questions and avoids ending up their prey.

From our partner International Affairs

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Deciphering EU’s new investment deal with China

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The perceived economic gains of the Comprehensive Agreement on Investments (CAI), which the 27-nation European Union recently struck with the People’s Republic of China, come at the cost of disregarding human rights, which the Western bloc is known for, amid clear and irreconcilable systemic differences.

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The closing days of 2020 saw the European Union and China striking a deal known as the Comprehensive Agreement on Investments (CAI), thereby concluding seven long years of negotiations, as per the year-end deadline. China is also the EU’s biggest trading partner after the United States, but a strategic and systemic rival too.

The European Commission, Brussels-based executive arm of the EU, primarily led the negotiations on behalf of the bloc. Germany, being the holder the EU Council Presidency and led by Chancellor Angela Merkel’s continued push, combined with Beijing’s last-minute concessions, proved instrumental in expediting the process of finalising the CAI before the end of 2020.

However, the deal will still have to wait for a formal ratification by both sides and an approval by the Strasbourg-based EU Parliament, a tougher task, before finally setting it on course to be effective in a couple of years’ time, if not by early 2022.

Better rules, level-playing field for European businesses

The EU, by this deal, aims to widen the access for European companies to lucrative Chinese markets, with billion-plus consumers, on a wide range of sectors, particularly in services such as healthcare, finance, cloud-computing and air travel, among others, that has always been restrictive to foreign players in the past.

The deal could bring in a level playing field in the conduct of European businesses in China wherein Chinese state-owned enterprises will no longer be given preferential treatment through subsidies, thereby promoting fair competition and ensuring transparency in technology transfers. Newer possibilities for the expansion European businesses in China will be opened.

The CAI also promise better rules, investment protection, and an investment dispute settlement mechanism within two years of signing, which will replace all the separate bilateral investment treaties currently signed between China and EU member states. The EU maintains that the main purpose of this new deal is to address the economic imbalance in its relations with China.

However, the most striking aspect of the CAI is that, for the first time, China commits to follow accepted standards on climate and labour aspects, even though in a vague form. And for the EU, the timing of this deal with China is significant as a way of signalling its reengagement with the world in the aftermath of a post-Brexit scenario.

At the same time, the CAI reaffirmed reciprocal access for Chinese companies into European markets, which they always had. So, the deal matters to Europe, more than it matters to China. So, the real question is the extent of compromises which European negotiators had to make to strike the deal with the Asian superpower.

The issue of forced labour in China

Many EU member countries and the US had been apprehensive about the human rights situation in the northern Xinjiang province of China where there have been evidences and investigations on the use of forced labour from the media and elsewhere, which has not been duly factored in while concluding the investment deal.

It has been alleged that in the past several years, the Chinese government has forced over a million Uighur minorities in Xinjiang to perform seasonal labour against their will and are often underpaid. But, the Chinese government has repeatedly denied such allegations.

Many European lawmakers believe that China is not interested in fully complying with international agreements after signing it and is not a responsible and trustable partner. The presence of mass detention camps in this province, as verified by satellite imagery and other documents, is also a human rights concern which the EU was not supposed to ignore, considering its historical commitments to human rights.

US concerns and strategic rivalry

The incoming Biden administration has also raised concerns about the CAI, stating that it would “welcome early consultations” with its European partners on shared concerns surrounding China’s unfair economic practices, hinting at the issue of forced labour and the deal’s lacking on the question of enforcement of human rights.

Being a security and strategic partner of the US and part of the North Atlantic Treaty Organisation (NATO), any such deal which EU and its member countries sign with its strategic rival, China, could effectively undermine American-led efforts to counter the strategic and geopolitical threat posed by Beijing’s aggressive and expansionist policies around the world.

It also flies in the face of an incoming Biden administration which is openly committed to mend relations with allies in Europe that had been worsened under Donald Trump. Many experts in the US have felt the EU should’ve waited for a few more weeks until the Biden administration takes charge to form a co-ordinated approach, as it related to their common systemic and strategic rival, China.

Moreover, the deal comes at a time when individual EU members such as Germany and the Netherlands have recently released their own outlook on the Indo-Pacific strategy, which is perceivably aimed at containing China’s rise and to ensure balance of power in the region. Meanwhile, France’s outlook is in existence for two years now.

Way ahead for implementation

The deal has now been reached at the technical level, paving way for a final ratification. But, getting the deal through the European Parliament, which attaches far more significance to human rights concerns than the Commission and the Council, is going to be a tough task, as many European legislators are increasingly sceptical of Chinese intentions and commitments to any deal.

The coming months are going to be crucial with regard to how the European legislators will debate and take forward the deal to the next level.

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Hungry for change: An open letter to European governments

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In 2020, the entire world knew what it was to be hungry. Millions of people went without enough to eat, with the most desperate now facing famine. At the same time, isolation took on a new meaning, in which the lonely and most remote were deprived of human contact when they most needed it, while the many victims of Covid-19 were starved of air. For all of us, the human experience fell far short of satisfying even the most basic needs.

The pandemic has provided a taste of a future at the limits of existence, where people are bereft, governments are stymied and economies wither. But it has also fuelled an unprecedented global appetite for change to prevent this from becoming our long-term reality.

For all the obstacles and challenges we face in the weeks and months ahead, I start 2021 with a tremendous sense of optimism and hope that the growling in our stomachs and the yearning in our hearts can become the collective roar of defiance, of determination and of revolution to make this year better than last, and the future brighter than the past.

It starts with food, the most primal form of sustenance. It is food that determines the health and prospects of almost 750 million Europeans and counting. It is food that employs some 10 million in European agriculture alone and offers the promise of economic growth and development. And it is food that we have learned impacts our very ecosystems, down to the air we breathe, the water we drink, and the climate we enjoy, come rain or shine.

Even before the pandemic, 2021 was destined to be a “super-year” for food, a year in which food production, consumption and disposal finally received the requisite global attention as the UN convenes the world’s first Food Systems Summit. But with two years’ worth of progress now compressed into the next 12 months, 2021 takes on a renewed significance.

After a year of global paralysis, caused by the shock of Covid-19, we must channel our anxieties, our fear, our hunger,and most of all our energies into action, and wake up to the fact that by transforming food systems to be healthier, more sustainable and inclusive, we can recover from the pandemic and limit the impact of future crises.

The change we need will require all of us to think and act differently because every one of us has a stake and a role in functioning food systems. But now, more than ever, we must look to our national leaders to chart the path forward by uniting farmers, producers, scientists, hauliers, grocers, and consumers, listening to their difficulties and insights, and pledging to improve each aspect of the food system for the betterment of all.

Policymakers must listen to Europe’s 10 million farmers as custodians of the resources that produce our food, and align their needs and challenges with the perspectives of environmentalists and entrepreneurs, chefs and restaurant owners, doctors and nutritionists to develop national commitments.

We enter 2021 with wind in our sails. More than 50 countries have joined the European Union in engaging with the Food Systems Summit and its five priority pillars, or Action Tracks, which cut across nutrition, poverty, climate change, resilience and sustainability. And more than two dozen countries have appointed a national convenor to host a series of country-level dialogues in the months ahead, a process that will underpin the Summit and set the agenda for the Decade of Action to 2030.

But this is just the beginning. With utmost urgency, I call on all UN Member States to join this global movement for a better, more fulfilling future, starting with the transformation of food systems. I urge governments to provide the platform that opens a conversation and guides countries towards tangible, concrete change. And I encourage everyone with fire in their bellies to get involved with the Food Systems Summit process this year and start the journey of transitioning to more inclusive and sustainable food systems.

The Summit is a “People’s Summit” for everyone, and its success relies on everyone everywhere getting involved through participating in Action Track surveys, joining the online Summit Community, and signing up to become Food Systems Heroes who are committed to improving food systems in their own communities and constituencies.

Too often, we say it is time to act and make a difference, then continue as before. But it would be unforgivable if the world was allowed to forget the lessons of the pandemic in our desperation to return to normal life. All the writing on the wall suggests that our food systems need reform now. Humanity is hungry for this change. It is time to sate our appetite.

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Blank Spot in EU

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The historic exit of the Great Britain from the European Union sparked both opportunities and chaos alike. Whether it comes to sectors within and beyond the orders of Britain, the trade policy with Northern Ireland or the isolated position of the bloc as the pandemic continues to perforate the continent with each passing day. It took a span of 4 years and a combination of referendums, disagreements in the House of Commons, displacement of public office and relentless efforts of the diplomats to bargain and negotiate an exit deal. Despite of the celebrated trade deal in action, much of the uncertainty still looms across Europe. The economic bloc now faces an empty spot of a 28th member post UK-exit and with rilling economic desperation and the Coronavirus spiralling alike, EU seeks a promising role to displace some of the pressure buildup.

The United Kingdom, mainly London, serves as the only unarguable financial rival to the metropolis of New York. Although the financial epicentre casted no qualms over trade post Brexit and even the EU financial markets reported no apparent glitches in trade across borders now subject to custom rules and regulations, the sheer volume of the trade denominated in LIBOR projects a sinister possibility of financial turmoil in the near future. Moreover, the trade deal negotiated, hailed by either parties as a victorious bargain, does little to placate uncertainty in the financial markets which further encourages the need of a solid alliance or partnership to fill the gap and subsequent irregularities faced by the European Union.

Turkey stands as one of the aspirants seeking EU membership. Every European state enjoys the privilege to seek EU membership which is subject to yearly review. Turkey has been a lurking party to seek EU approval since 1987. The opportunities opened up in 2016 after decades of tensions over Turkey’s shady democracy and violent role in dealing with their Kurdish minority, residing on the south-eastern borders of Turkey shared with a war-torn Syria. A refugee deal was signed in 2016 between Turkey and EU to facilitate Syrian refugees amidst the greatest refugee crisis since World War II. The deal served as a defining chapter in improving bilateral relations. Despite of Turkey’s conditions in the refugee deal: demanding a $60 billion grant from EU to pivot the refugee crisis, EU subliminally promised an expedited track for Turkey’s ascension to EU membership. 

However, Angela Merkel, the Chancellor of Germany, and arguably the most powerful political figure in the circles of Europe, always stood against and awry to Turkey’s membership in EU. The talks of Turkish membership were even stalled back in 2019 in the EU parliament and the prospects looked murky. However, as Merkel inches closer to departure from Germany’s political benches after decades of systematic control, Turkey cites the opportunity as a blessing in disguise. Coupled with Germany being at the verge of a severe recession synonymous in scale to the financial crisis of 2009, Germany’s position could actually shift in favour of Turkey ever since UK-exit baffled even the most sage minds of the continent.

The opportunities, however, are not the only blocks paving way for Turkey towards EU. Turkey shares a brutal conflict with Greece, another EU member state that has muddled the chances of Turkey in the EU for decades. Turkey has the longest continental coastline in the East Mediterranean which has been long contested with Greece over the gas reserves found profoundly in the waters of the East Mediterranean. Both countries have overlapping areas and have time and time again rejected each others claims over respective maritime borders and continental shelves. The icy relations between the duo have been hazy due to multitude of other reasons as well. Ranging from disputes over Turkish migrants crossing Greek borders to ships anchoring in the disputed regions without prior alert. The recent turmoil incited when Turkey officially declared Hagia Sophia, a museum in Istanbul and a historic remnant of Greek Orthodox Christian Cathedral, as a mosque which infuriated the Greek patriots.

Turkey’s ascension to membership might be a solution to economic disparity in the region; Turkey serving as a corridor between Europe and Asia and opening channels of economic flourish to EU like Silk Road initiative with China. The ascension could even solve the border disputes with Greece and project a solution to the energy reserves in Mediterranean, solving the divide once and for all. Even with Recab Tayyab Erdogan’s boasting position over improving relations with EU, the extent of ease in bilateral relations is still unclear. As top Turkish Diplomat’s schedule visit to Brussels in a week, and Turkey and Greece are to resume exploratory talks over territorial claims in the Mediterranean on January 25th, glimmers of astounding results are on cards in the arching diplomacy of Europe.

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