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What Does the Coronavirus Mean for EU-China Relations?

A ChinaFile Conversation

2020 promised to be an especially consequential year for the EU-China relationship, but three highly anticipated summits have been thrown into uncertainty, and diplomacy between Europe and China is now completely consumed by the coronavirus crisis.

Over the past several weeks, China has tried to claim a positive role in handling the pandemic through “mask diplomacy”—shipping medical equipment and expertise to disease-stricken areas of Europe. That has generated praise from some European leaders, notably from Italy and EU accession candidate Serbia, who have simultaneously expressed frustration about a lack of support from Brussels. Germany, France, and the EU Parlament, aghast at the challenge to European solidarity, have countered by highlighting the work they are doing to help fight the coronavirus in Europe.

What will happen next? How is the Coronavirus pandemic impacting EU-China relations? And how might it shape the relationship in the years to come? —The Editors

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Somewhat ironically, perhaps, the EU and China could commiserate as the pandemic exacerbates old wounds in both. The EU faces growing problems with its cohesion: Southerners and northerners are having a shouting match over the proposal for corona bonds, while Viktor Orbán’s Hungary is turning even more authoritarian, supposedly in the name of combating the outbreak. China is scrambling to tackle its own structural economic problems, which were challenging the myth of the Chinese Communist Party’s infallibility even before the COVID-19 disaster struck Wuhan. Furthermore, Beijing has been terribly embarrassed by disobedience in Hong Kong and Tsai Ing-wen’s reelection in Taiwan—the same Taiwan that did remarkably well in containing the outbreak, despite being treated as an outcast by a China-steered World Health Organization.

2020 was supposed to be a year of Euro-Chinese summitry. So far, the outbreak has led to the postponement of a high-level meeting between EU institutions and China’s leadership, and it is unclear when the next meeting between Xi Jinping and 17 heads of state from Central and Eastern Europe, originally expected to take place in April, will be scheduled. And then there’s the big event, the 27+1 show in Leipzig next September. While EU-China relations have been set as a priority of Germany‘s EU rotating presidency, it is hard to predict whether the summit will qualify as a breakthrough, with all the bad blood between the two sides. After 20-odd rounds of negotiation, the Comprehensive Agreement on Investment (CAI) is still stuck. The FDI screening mechanism regulation, an implicit shield against aggressive Chinese takeovers of critical EU assets, will come into force next October. And the increasingly toxic debate on the 5G roll-out in Europe only further poisons relations.

The pandemic hasn’t been helpful either. China’s ostentatious display of magnanimity with its “mask diplomacy” has clearly irritated Brussels. Recently, Josep Borrell urged member states to brace for a “battle of narratives” with Beijing. The EU’s foreign policy chief stopped short of calling China a “systemic rival,” as a key policy document of the bloc’s institutions did a year ago, but in essence he confirmed just that.

In a the medium term—and I don’t think anybody can authoritatively say what will happen in the long run—a lot will depend on two factors. First, we need to see whether the EU will come out of the COVID-19 calamity weaker or stronger. A less united EU—and there’s plenty of room for further deterioration—will be more susceptible to China’s pressure or guile. But then again, the EU has come a long way through multiple crises. Second, the outcome of the American presidential race next November will also weigh in, as the U.S. inevitably looms large in EU-China relations. While there seems to be a rare consensus vis-à-vis China on both sides of the aisle in America, the personality and worldview of the man sitting in the Oval Office matters. Europeans’ problem with Donald Trump is not that much what he says about China, but his manners. As Oscar Wilde famously said once, “in matters of grave importance, style, not sincerity, is the vital thing.”

The EU’s approach to China has been on a downward trajectory for several years. By 2019, the European Commission had officially labeled the People’s Republic of China (P.R.C.) a “strategic rival.” Brussels continues to worry about Beijing’s efforts to carve out a sub-regional grouping known as the 17+1, a land-sea corridor stretching from Greece to the Baltic Sea.

Today, COVID-19 is killing thousands, killing economies, and may even kill off the EU itself. When the pandemic hit Europe, individual EU Member States initially refused to share medical supplies. China promptly stepped in to furnish them.

A friend in need is a friend indeed. However, China’s rather clunky propaganda is leaving a bad taste in some people’s mouths. Europe’s earlier aid to COVID-19-hit China complied with Beijing’s request to be discreet. In return, China has trumpeted its aid programs, often conflating aid and sales and suggesting that the EU was not there to help. As it turned out, some of the equipment provided by China proved defective.

The P.R.C.’s propaganda drew concern in Brussels and a blog post by EU High Representative Josep Borrell on a “battle of narratives” between the EU and China. China’s Ministry of Foreign Affairs and state-controlled media even created fake news, suggesting the virus did not come from the P.R.C. Now, the EU is worried about disinformation not only from Russia but also from China.

The propaganda blitz is two-fold: On the one hand, it targets the domestic audience in China to show that Europeans are grateful. On the other, it woos Europeans to China. On social media, bots push the narrative of “Grazie Cina” and fake videos are issued that show Italians singing the Chinese national anthem. But the paradox of propaganda, exposed by Pew research, is that the more Europeans are exposed to China the less they like it.

Long after the bodies are buried, people will remember how, if C.C.P. officials had acted three weeks earlier, 95 percent of people could have been saved. And although some of Europe’s governments might find it convenient to embrace Beijing while pushing a Eurosceptic narrative, the defective equipment they paid for magnified their distrust of China, which is often associated with shoddy and unreliable goods.

With its economic and diplomatic activity, the P.R.C. seeks to divide and undermine the EU. It has successfully neutralized some Member States, e.g. Greece and Hungary, and may well prevent others from joining. Serbian President Aleksandar Vucic, for example, emphasized Beijing’s aid by meeting a plane carrying Chinese medical supplies and kissing the P.R.C. flag, while appearing to take for granted EU aid and previous programs.

Will “mustn’t grumble” become the new watchword in EU-China relations as European companies fear retribution from Beijing if they don’t fall into line on the origin of the virus or show enough deference? The European Commission has issued guidelines to improve FDI screening to protect strategic infrastructure and businesses in post-COVID-19 Europe. In this context, Europeans may well want a homegrown telecommunications champion instead of Huawei. As European citizens in the P.R.C. complain of mistreatment, it remains to be seen what type of appetite will remain for operating businesses there. When the COVID-19 lockdown ends, Europe’s “social distancing” towards China is likely to continue.

Nobody knows, of course, how the COVID-19 pandemic will end up changing Europe-China relations in the long term, but here are three informed guesses.

  1. At the moment, the virus looks as if it will widen the transatlantic gulf in perceptions of China. In Europe, there is nothing like the hurricane of anger against China that one hears from many quarters in the United States, reinforcing a certain “new Cold War” vibe. In a few countries with direct experience of Communist rule, such as Poland, there is (well-founded) skepticism about the way China tells the story of how it has handled the crisis, along the lines of “lies, damned lies, and statistics.” In most of Europe, however, the view of China’s handling of the crisis is somewhere between neutral and positive. The positive feeling is strengthened by publicity around Chinese aid packages (facemasks, testing kits, etc.) to countries like Italy. Almost no one remembers—partly because the Chinese authorities reportedly asked Brussels to keep it quiet—that when China was at the eye of the storm earlier this year, the EU sent medical aid to China.
  2. After the medical pandemic will come the economic one. All European economies will take a huge hit, along with those of China and the United States. No one will come out of this well; the question is who comes out of it least worst. The weaker economies of southern and eastern Europe, especially those with high public debt, will take loans and investment wherever they can find them. The Chinese economic presence in these countries (peanuts for Beijing but giant toffee-apples for Athens or Budapest), and therefore Beijing’s leverage inside the EU via these member states, will probably increase.
  3. The longer-term picture depends on a larger question, namely, will the impact of the coronavirus pandemic, on top of all the other crises Europe already faces, tend more to weaken and divide the EU or to strengthen and unite it? Currently, the former tendency is more apparent. The open borders Europe is so proud of were closed overnight, by the unilateral decisions of national governments, without wider EU consultation. Member states are in national self-isolation. But everyone recognizes that this crisis is too good to waste. In the best case, it might just be a moment of breakthrough to more European solidarity between the northern European and southern European members of the Eurozone, which will be crucial to a larger renewal of the EU. If so, the EU could gradually become a more coherent actor on the world stage, and also in relations with China. Its policy towards Beijing would be “softer” than that of Washington, but then so was its policy towards Moscow, and that transatlantic double act didn’t work out so badly in the end. I wouldn’t bet on it, but if you want a silver lining, that could just be an unforeseen long-term consequence of an unexpected crisis.

It hasn’t been much more than two months since China’s leaders forced a turnaround in the previously negligent approach to the COVID-19 crisis by shutting down the city of Wuhan. At the time, many of us commiserated with the Chinese people for the epidemic that had befallen them and for the way their government wasted valuable time by suppressing the truth about the outbreak. Very few of us foresaw, at the time, how hard the pandemic would hit us, and how deeply it would interrupt our daily lives, disrupt and threaten our economies, and challenge our own political systems to their cores.

As of now, the epicenter of the health crisis has moved to Italy. The death toll in several European countries exceeds that of China. Meanwhile, the U.S. government estimates America might lose as many as 200,000 people. As we languish, China has started a hard propaganda campaign to peddle the narrative of a triumphant nation, which, guided by the people’s leader Xi Jinping, has triumphed over the virus, helped buy time for the rest of the world through its valiant fight, demonstrated the superiority of its political system, and is now graciously willing to help everybody in need.

The jury is still out on the level of damage China’s economy will suffer from this crisis. In Europe’s case, we can only speculate how much economic turndown and uncreative destruction we will witness. Our woes might prolong and deepen China’s predicament. But politically, one outcome of the last two months is already obvious: More than ever before, China will be playing offense and Europe defense. Some elements of our European predicament are self-inflicted. It was European selfishness and lack of solidarity that granted China the opportunity to present itself as “friend and brother” to those left to fend for themselves, at least initially, by their European partners. Tellingly, Paris and Berlin found it important to stress that together they had sent more face masks to Italy than China had. Had China played its cards modestly, it could have collected a wealth of goodwill beyond reproach. But China pushed too aggressively. It peddled lies about the origin of the virus. It boasted too much about its provision of what, in some cases, turned out to be faulty masks. It created credibility problems with the reliability of its own case figures. Collaboratively, the Chinese Party-state and Huawei tried to exploit the situation economically in several countries, notably in the Netherlands but also in Germany and the U.S.

China effectively did all it needed to convince reluctant leaders, both at Downing Street and in Berlin’s Chancellery, that they had to push back against Chinese arrogance. China skepticism has already been spreading throughout Europe over the last year and a half. But the level of resolve with which political leaders attended to changing sentiment from the business community and from civil society was not very high. I expect this will change. In short: Over the past two months, China has lost Europe.

During the global financial crisis, China largely shed its image as a developing country ruled by an odious regime. The crisis offered China a way out of ideological ostracization, inflated both its economic clout and soft power, and brought its influence to regions where it had never before existed, such as Central Europe. China ceased to be regarded as the world’s factory, and for some countries became instead a creditor of the last resort.

Today, the situation is both similar and substantially different. China continues to play a key role in the international economy—now far more developed and sophisticated than during the previous global crisis. It is also a substantially more self-confident player. With countries scrambling for medical equipment, while the U.S. flounders thanks to an erratic and self-absorbed lead, Beijing is trying, once again, to play the role of global savior.

Yet, much is different. With its growing power, China has faced predictable opposition. Its strategic ambitions have provoked the U.S. to adopt a balancing act in the Asia Pacific, while across the Western world, Chinese actions and actors have become a diplomatic irritant—as demonstrated by European and American reactions to Huawei. Also, notwithstanding the ugliness of Donald Trump’s discourse about a “Chinese virus,” the outbreak of COVID-19 did in fact originate in China—and the country’s initially incompetent reaction allowed its spread. While in relation to the global financial crisis Beijing could legitimately claim it was offering a solution, this time it is undeniably a part of the problem.

All of this will shape the future of EU-China relations. However, much will depend on the situation within the EU itself. First, the speed and scope of economic recovery will be crucial. Second, Europe will only be able to recover fully if it rediscovers its solidarity. Without substantial EU-wide transfers, some regions (particularly northern Italy) will not be able to overcome the damage caused by the pandemic. Third, even if efficiently deployed, intra-EU solidarity will come to naught if Europeans don’t internalize it. So far, European institutions and member states have done an extraordinarily poor job pointing out the benefits of cooperation.

If Europe pulls its act together and the EU’s success is sold to the Europeans through an effective communications strategy, EU-China relations will be minimally affected.

The worst-case scenario could become true if Italy is allowed to fall, thus becoming a nightmarish “second Greece.” There, China leased the port of Piraeus; in post-COVID-19 Italy, it could buy the whole country. In some countries, Chinese “help” (often bought in hard cash) is already greeted with devotional reverence. Through their indolence, member states and EU institutions could increase the space for China’s influence. This process would not, of course, go unopposed, but it is not beyond imagining. The result could be an EU torn into pieces along yet another dividing line. As usual, the solution is largely in the Europeans’ own hands.

Europe was a hotly contested space long before the pandemic broke out, at least since the start of the U.S.-China trade war. Tactical alliances with lesser enemies against their main rivals are a mainstay of the Chinese Communist Party’s United Front approach. To outflank the U.S., Beijing has sought closer relations with the EU, yet another variation on the classic triangular balancing of power. Within the EU itself, China has employed a similar tactic, setting Central and Eastern Europe (CEE) against Western Europe through the 16 (now 17) + 1 arrangement.

The coronavirus crisis has only made the situation more acute. Beijing can ill afford an embarrassment that would dampen its ambition to lead the World towards the “community of shared destiny for humankind.” Its claim to global leadership rests on demonstrating that the Leninist one-party system solves the world’s problems more efficiently than the decentralized chaos of democracies. Its initial flop, censoring information rather than controlling the disease, was not a good start. But the sometimes draconian quarantine measures employed afterwards might help restore Beijing’s desired image.

Face-mask diplomacy, moreover, offers an opening to change the narrative. Europe, like most other regions, found itself in desperate want of protective gear when the pandemic reached its soil. In part, this was due to Europe’s having sent exactly this kind of gear to China when the outbreak was at its peak there, and while the outside world seemed relatively untouched.

According to official statistics from the People’s Republic of China (P.R.C.) customs administration, from January 24 through February 29, China imported 2.02 billion face masks. It’s not clear whether this figure also includes donations that came as official aid and bulk-purchases by overseas Chinese communities.

In March, the situation reversed, and face mask deliveries started to go the other way around, from China to Europe and elsewhere, as the P.R.C. ramped up its own production capacity. It is perfectly normal that goods would travel back and forth, driven by the laws of supply and demand. What is less normal is the barrage of propaganda that accompanied the supply when the direction of the flow reversed in March.

While the sourcing of face masks from outside China in February went barely noticed, Beijing made sure that the reverse flow would not be missed. Especially in Central and Eastern Europe, the commercial supplies were presented as “aid,” and almost acts of mercy. In Prague, one of the first planes was met at the tarmac by top Czech government officials, lined up in a bizarre Cargo Cult-like ceremony for a speech by the Chinese ambassador—who, only a few weeks earlier, almost got PNG’d for sending a threatening letter to Czech politicians.

For the time being, face mask diplomacy reinforces the pro-Beijing lobby throughout Europe. But it has also alienated top EU officials, like the EU diplomacy chief Josep Borell. All in all, it seems to have further divided public opinion towards the P.R.C. Only time will tell whether Beijing has once again overplayed its hand, or whether some of the—rather forced—gratitude sticks beyond the crisis.

Xi Jinping to the right of Angela Merkel, surrounded by 26 European Heads of State and Government: That could be the most memorable photographic exploit of the EU-China summit scheduled to convene in mid-September in the German city of Leipzig. Six weeks ahead of the American presidential election, it would send a strong message of EU-Chinese rapprochement in a time of America’s withdrawal from international leadership.

With Germany holding the rotating EU presidency, Merkel’s original idea when she invited her colleagues to Leipzig was a very different one. In 2019, the EU had begun to recognize China as a “systemic rival,” and to more assertively counter Chinese efforts to split the Union. Such efforts had been aimed at winning EU allies on allowing Huawei into Europe’s 5G market, or on support for China’s “new silk road” scheme. Yet, increasingly, EU countries had begun to limit Chinese state-supported investments or the sale of advanced dual-use technology. Merkel and the EU Commission had meant to send a message of European unity and new resolve to Beijing.

That the perspective for Leipzig can now be such an entirely different one is the consequence of the Chinese Communist Party’s (C.C.P.’s) agility in grasping the opportunity to turn around an image of humiliating inability. COVID-19 spread due to an early failure to admit its existence and to stop Lunar New Year travelers from carrying it around the world. Now, a global campaign spreads the convincing narrative that China is defeating the virus faster and more effectively than any other country in the world.

Three factors impacted the EU’s attitude towards China. First, the recognition of an impending public health catastrophe in China. This led to an outpouring of humanitarian aid. Second, the quick transmission of the virus in Europe with rising numbers of infected and dead, beginning in Italy. EU member states instantly regressed to instincts of defending their own territories: closing borders, even for trade of necessary hospital gear, ignoring the need for joint action. Third, the new narrative from Beijing gained traction: The C.C.P., able to manage the crisis, was now ready to help the world. Soon, Italian and Spanish leaders celebrated support from China more than that from European countries, the Serbian president kissed a Chinese flag, and a small-town German official wrote an appeal for help to Xi Jinping. At the same time, aggressive rhetoric from Chinese diplomats in Europe about the inability of democracies to control the epidemic was paralleled by smoother language on China’s hopes for a promising future relationship.

Certainly, the image of European meekness is only a momentary snapshot, the parameters of international politics continue to change dramatically, and the question of the responsibility for the pandemic may yet return to haunt Beijing. But the European Union had better not count on it, and needs to get ready for Leipzig. Josep Borrell, the EU’s High Representative, is already questioning the true purpose of the C.C.P.’s, “policy of generosity.” Europeans ought to ask: Is China able to share responsibility for the international community in earnest, to cooperate on what dealing with the worst global crisis since World War II requires? The challenge is, can it match its propaganda with deeds?

At the turn of the new decade, the EU-China relationship was under serious strain: China’s “17+1” scheme was a major irritant to Paris and Berlin in particular; Huawei was a significant bilateral conflict bubbling under the surface; and China’s flagship Belt and Road Initiative was revealed to be far less universally beneficial than China’s leaders had previously asserted.

Yet there was real hope that the new EU Commission, along with a China-focused European Council in the second half of 2020, could reinvigorate relations. German Chancellor Angela Merkel was lining up the September Leipzig summit to seal the long-negotiated EU-China investment agreement.

Then came COVID-19.

The outbreak compelled China to disclose the magnitude of the challenge, as it began its fight to prevent the virus’ spread. While some voices responded with deplorable racism, characterizing it as a “Made in China” virus, most of the EU answered with sympathy. European governments provided support while EU companies operating in China went into humanitarian overdrive, donating millions in time and resources.

The economic and political impacts of the outbreak began almost immediately. Exports to Europe screeched to a halt and supply chains were universally rocked, forcing companies to consider major diversification. Meanwhile, the outbreak interrupted high-level political meetings, reducing communications to phone calls and video conferences; every face-to-face meeting cancelled represented an opportunity lost to push through important agreements. A wait-and-see attitude began to sink in.

As the virus moved from China to Europe, Chinese leaders reciprocated the support they had received from Europe and sent masks, equipment, and doctors. While this wonderful show of mutual care can help narrow the gulf between the two regions, the xenophobic sentiments from both sides—with many Chinese citizens now believing foreigners pose the biggest threat of a resurgence of the virus within China—will only drive them further apart.

People in Europe are questioning China’s governance model, and the fact that it covered up the problem for several weeks has not gone unnoticed. The absurd attempt to deflect the blame and label the U.S. as the origin of the problem merely stoked anti-China sentiment.

European unity is now critical both to address the virus and to cement EU-China relations. The relationship cannot be approached as a zero-sum game, as that would precipitate a move towards the decoupling championed by President Donald Trump, resulting in rising costs, mass unemployment, and the destruction of international supply chains.

The noun ”crisis” derives from the Latinized form of the Greek, “krisis,” meaning “turning point in a disease.” At such a moment, the person with the disease could get better or worse: It is a critical moment. The current situation calls for bold decisions by both the EU and Chinese authorities that could change the face of globalization forever. They should not waste this crisis, and instead treat it as the turning point it is.

We are in the early stages of understanding how the coronavirus pandemic is impacting and might shape Europe-China relations in the years to come. A lot will come down to whether European governments—once the health emergency is over—will find that they can trust Beijing to be a reliable partner.

For the time being, the outbreak has prompted European administrations to question the reliability of information coming from China at the beginning of the epidemic; rethink their dependency on a single, external supplier for crucial medical equipment; and reinforce their defenses in the event of foreign acquisitions in a time of economic vulnerability.

In addition, European leaders have been irked by what they see as a shameless public relations campaign launched by Beijing on the back of their countries’ need for medical supplies.

To be sure, right now any kind of support, in the form of exports or donations of equipment, is welcome and appreciated. Nevertheless, it is clear that there is a geopolitical component to the “politics of generosity”—as the EU’s top diplomat, Josep Borrell, recently put it—that states like China are playing.

Hoping to divert the European public’s attention away from its own responsibility for delaying the international response to the pandemic, the Chinese government has launched a major propaganda effort. While the U.S. is the main target of conspiracy theories propagated by Chinese government officials, in Europe, too, Beijing has engaged in disinformation activities.

Beijing seems also determined to use this crisis as an opportunity to enhance its soft power, promoting itself as a model for managing the emergency and as a selfless state coming to the rescue of countries in need.

In this endeavor, China’s leaders have been helped by their populist, Eurosceptic counterparts in Hungary, Italy, and Serbia, who contrast what they portray as China’s generosity with a supposed lack of EU solidarity. To serve their domestic agendas, they want to be regarded as the architects of special relationships that are allowing their countries to “save lives.”

Beijing, meanwhile, has conflated exports with donations, giving the impression that all the supplies coming from China are part of aid packages.

In the short-term, Beijing might be able to win some hearts and minds, especially among the more Eurosceptic members of our societies, who are more prone to accept alternatives to traditional alliances. However, in the longer term it will be more difficult for the Chinese government to convince large groups in our governments and societies of its innocence in this crisis and of the benevolence of its gestures.

Some European leaders have already expressed skepticism towards China’s self-promotion. Others have even hinted at a “reckoning” facing Beijing after the pandemic. Now is the time for nations to cooperate on finding solutions to the human suffering caused by this global emergency. But once this is over, European governments will be more clear-eyed about their engagements with China and its ruling Communist Party.