The relationship between the European Union (EU) and China is one of the most important issues in current international relations, especially in the light of a trade dispute between the United States and China that, arguably, goes much further than trade. It is a struggle between values, between perspectives of what the world should look like, between multipolarity and unipolarity, and for the economic and political system that will prevail. Specifically in respect of global economic governance – the rules and norms that govern the economic regime of international trade and institutions – China seems to be building an alternative to the prevailing Western model where the fundamental liberal values of democracy, freedom, and human rights prevail. Instead, the Chinese model prioritizes national sovereignty, social stability, and the survival of the Chinese Communist Party (CCP).
In the context of the Conference of the Future of Europe and the development of a new EU China strategy, my analysis uses an altered model of the Prisoner’s Dilemma to illustrate how communication can promote cooperation between both actors and lead to mutual understanding. It also incorporates the domestic policy perspective in the analysis as relevant variable to consider when analysing China’s foreign policy perspectives and to increase their cooperation through a more effective EU China strategy. Finally, some policy recommendations are made, including delinking values from interests in EU-China dialogues, improving communication channels, building lasting people-to-people relations through soft power, a two-tier China Strategy, and the creation of a ‘China intelligence unit’.
The relationship between the European Union (EU) and China is one of the most important issues in current international relations, especially in the light of a trade dispute between the United States and China that, arguably, goes much further than trade. It is a struggle between values, between perspectives of what the world should look like, between multipolarity and unipolarity, and for the economic and political system that will prevail. Specifically in respect of global economic governance – the rules and norms that govern the economic regime of international trade and institutions – China seems to be building an alternative to the prevailing Western model where the fundamental liberal values of democracy, freedom, and human rights prevail. Instead, the Chinese model prioritizes national sovereignty, social stability, and the survival of the Chinese Communist Party (CCP). When translated into foreign policy, it is a model that does not include any kind of conditionalities but that is motivated by economic profit and overall national interests; while the EU and its Member States have traditionally been guided – both rhetorically and in setting the conditions for aid – by the promotion of anti-corruption, transparency, respect for human rights, and ultimately democratic norms and values.
The EU is thus faced with the challenge of designing and implementing its own, independent ‘China strategy’, which will be an intrinsic part of its Conference for the Future of Europe (CoFoE). This strategy, and the CoFoE, is about Europe’s role in upholding multilateralism in global governance, in standing for the values that have traditionally been at the core of its foreign policy and that now have to be even more strongly enforced at home and abroad if it aims to be an autonomous global actor capable of independently protecting and preserving those liberal values worldwide. In this paper, I argue that it should continue to aspire to be such an actor, especially in the context of a retreating and increasingly isolationist United States: US President Joe Biden may claim to ‘be back’ when it comes to fighting common threats such as climate change, but the US clearly is not ‘back’ when it comes to foreign policy, as witnessed by the speedy and messy retreat from Afghanistan during the summer of 2021.
My analysis uses an altered model of the Prisoner’s Dilemma to illustrate how communication can promote cooperation between both actors and lead to mutual understanding. The classical idea of the Prisoner’s Dilemma comes from game theory, and it represents a situation where two individuals acting in their own self-interest leads to a suboptimal outcome, because their impulse to protect themselves leads them both to a worse state than if they had cooperated with each other in the decision-making process. This concept could help us set the policy framework to avoid what has been popularized in the media and academia as a ‘new Cold War’; we will also analyse the probability of this happening by mapping current spaces of dialogue between the EU and China, as the world moves away from US dominance towards a more multipolar world with two great powers, which could potentially lead to a Thucydides Trap. This is a trap identified by the ancient Greek historian Thucydides, who explained that Athens’ rise instilled fear in Sparta, leading to the latter’s militarization and ultimately the war between the two powers.
From the liberal internationalist perspective, I examine how the EU should react to China’s efforts to move away from the existing liberal globalist world towards a more interest-led, state-controlled economic and foreign policy: that is, how the EU can use the existing bilateral forums of dialogue to achieve a better understanding of China and its intentions, and to either respond accordingly by accommodating its demands and thus avoiding confrontation, or counter-balancing it. Finally, to make this analysis relevant and complete, I will incorporate the body of research that takes domestic politics into consideration and evaluates how international politics also has the potential to shape the domestic preferences of ruling elites, as the basis for a longer-term strategy to socialize China into the existing ecosystem of global governance.
In responding to the rise of China, in the context of the aftermath of the biggest health crisis that the EU has ever had to face, this paper aims to provide a theoretical framework with which to understand the dynamics of the relationship of cooperation and conflict between the EU and China and to offer recommendations for the design of a more realistic, fruitful, and forward-looking China strategy.
Therefore, we have to ask how the EU can optimize its China strategy within the structure of EU–China dialogues. This boils down to considering how each region’s domestic politics influences the foreign policies of each other and to identifying the main points of contention and the most potentially fruitful areas for future cooperation. The paper considers and includes the variable of domestic stability in China, national security, and respect for its political party structure as particular points of contention that can hinder foreign policy cooperation, and it analyses how the regions perceive each other and how these societal perceptions incentivize or hinder more cooperative foreign policy. Finally, we will see that the topic that each EU–China dialogue is meant to address – in particular, how sensitive this topic is for the CCP in terms of its national priorities – is the main determinant of the outcome in the modified Prisoner’s Dilemma framework: a cooperative outcome, defection from the negotiations, or withdrawal or avoidance to negotiate altogether from China’s side, and an indicator of distance or divergence with respect to EU’s starting negotiating position.
Forever caught in a Prisoner’s Dilemma
In many situations, especially those related to values such as democracy, human rights, and fundamental freedoms, the EU and China get caught in a Prisoner’s Dilemma-like situation, where conflict prevails and both end up defecting from any kind of agreement. To avoid a Nash equilibrium, wherein both players choose rationally to defect because of fear, greed, or distrust, Majeski and Fricks propose an alternative that better resembles the real world of international relations, which is more liberal than a truly anarchic, neorealist world, as I will explain. In their view, two players – for the purposes of this analysis, the EU and China – have repeated interactions and pursue multiple negotiations at the same time, creating channels of communication and building mutual trust. They also have the option to withdraw from negotiations as an alternative to defecting on a previously agreed commitment. The difference between this withdrawal option and the traditional ‘exit’ or defection option is that withdrawal means that the actor decides not to take part in a negotiation and this is communicated in a way that has no further negative consequences for the other actor; while defection means that the actor defaults on the commitments it made in past negotiations.
However, this happens in an environment where there are other sources of mutual mistrust, such as espionage, economic sanctions, cyberattacks, or the spread of misinformation. In this context, it is worth considering how to maximize the level of trust in EU–China dialogues, especially those related to values. Binding commitments consolidate trust, so we can consider the more material or economic interest-dominated dialogues to have a positive impact on the relationship, as their potential for mutual understanding and cooperation is higher, because economic interests and common commitments to fight climate change and foster digitalization make it easier to agree. This is demonstrated by the commitment to two high-level dialogues in 2020, one on the digital area and the other on environment and climate. The first High-Level Digital Dialogue took place on 10 September 2020, where they identified “priorities in the digital transofmration of both the EU’s and China’s economies, including areas where concrete progress is possible” and recognising the fact that “the EU and China will both play a role in defining how global technological developments will go forward. The dialogue is therefore necessary to foster cooperation, but also to address divergences we have, like on reciprocity, data protection and fundamental rights”, as Executive Vice-President Vestager recognised. On the EU-China High Level Environment and Climate Dialogue, already the second meeting took place on 27 September 2021, where they “reaffirmed the urgency of taking immediate action to fight climate change in the context of the UNFCCC and the Paris Agreement”, confirmed their commitment to “showing climate action leadership”, and “emphasized the importance of working together” so as to “inspire other countries to join their efforts”. They agreed to expand cooperation in many areas of environmental policies, and to continue this dialogue regularly at an annual basis.
The EU needs to capitalize on the trust that has been created to make progress towards agreement on human rights and values. Therefore, let us focus on what the EU should improve and change in its policy towards China within the focus of the CoFoE; Chinese foreign policy is thus beyond the scope of this paper. In that regard, the EU, and the European External Action Service (EEAS) in particular, should develop cultural training for its diplomats, to better equip them to understand the different conceptions that China has of the traditional notions of human rights and democracy, among others potential areas of misunderstanding. EEAS diplomats have been accused of having tunnel vision, believing that their vision of human rights is superior and universal, like some kind of universal idea that has not yet been discovered by the Chinese. A more practical pedagogical approach would probably be more productive, characterizing China as an equal partner and engaging in mature discussions about the nature and substance of human rights that would lay the groundwork for finding a common point from which to start a fruitful discussion on how to build respect for human rights and fundamental freedoms in China and the world. This pedagogical approach would involve a willingness to continuously teach, learn, and adapt, that is, to be influenced by the social, cultural, political, and economic conditions of the other actor. Greater cultural immersion and understanding of the Chinese psycheis needed in both Beijing-based and Brussels-based EU diplomats. If the EU believes its understanding of human values to be uncontested and unique, any discussion will be inherently conflictual and antinomic.
This more productive and fruitful approach would allow both the EU and its Member States to reprioritize human rights as a top concern in their foreign policy towards China, which will create a virtuous circle of understanding and rapprochement. A premise of this approach is a clear and systematic unity between the 27 Member States on what the substance and policies around human rights ought to be. Opposition from members such as Hungary or Greece, as witnessed in the past, need to be avoided by all means; it would show weakness and disunity, giving China greater leverage to avoid compromise and continue its obstruction, refusal, and hostility in respect of any talk of human rights. Any domestic concessions made by China on human rights issues as a result of its dialogue with the EU are often subject to quid pro quo, but this transactional approach will not be possible if China believes that it can take without having to give, as has been the case in the past.
Beyond that, this approach is fundamentally liberal. First, it is rooted in the theory of Keohane’s analysis of cooperation in international relations, in which cooperation is different from both discord and harmony:
<EXT> Cooperation, as compared to harmony, requires active attempts to adjust policies to meet the demands of others. That is, not only does it depend on shared interests, but it emerges from a pattern of discord or potential discord. Without discord, there would be no cooperation, only harmony. </ext>
Thus, cooperation is a mutual adjustment process, dependent on the existence of common interests, and regimes have the function of creating certainty and giving access to credible information so that states have incentives to cooperate. Cooperation in the world political economy is ‘a means of attaining self-interested economic and political goals’. As we have seen, with the modified Prisoner’s Dilemma, communication can facilitate cooperation and policy coordination, through a scheme of dialogues (see Fig. 1 for a visual map of the dialogue architecture) and other formal and informal platforms that can lead towards harmony and help avoid a new Cold War-like situation of radical division among world powers.
However, we need to account for very different political configurations and political norms that govern the EU and China if we want to coexist in a multipolar world. As Christiansen explains:
<ext> The more hierarchical arrangement in China permits more strategic action and also means that its diplomatic agenda is presented more consistently than that of the EU. In the face of the often-mixed tones coming from Europe, China tends to repeat the same message, and does so with one voice. On the other hand, the institutional set-up in China is not very flexible and tends to be slow moving, something which creates particular challenges when quick reactions to crises are required. </ext>
This shows the importance of the dialogue architecture as the main framework for communication and the promotion of mutual understanding between the EU and China. It also highlights the opportunity that the CoFoE presents, especially if it leads to treaty changes, as it provides the opportunity for reforms that are a prerequisite to an equal-to-equal, dynamic relationship with China, taking advantage of the intrinsic shortcomings in China’s political system.
Since the CoFoE is based on public consultation, it can facilitate the development of a China policy that resonates with public opinion in Europe and the consensus across Member States needed to promote a unified approach towards China, by developing a greater synergy between the political elite and society at large. This gives it a stronger hand in negotiating with China, since the fact that the EU’s position comes from this prior policy process makes it more legitimate but also more inflexible, and puts China in a position of having to conform or risk having no agreement at all if it forces the EU to go back and renegotiate internally. This is the only way Europe will be able to stand its ground and uphold multilateralism, which involves the protection and promotion of a specific role and direction for existing international institutions, in the face of China’s very different views.
The domestic is international
It is important to understand the domestic drivers of the CCP’s policy on human rights, as these are arguably the biggest obstacles to a rapprochement with the EU on this issue. As far back as 1988, Putnam stated that ‘domestic politics and international relations are often somehow entangled’. Indeed, they are, in a complex relationship that Gourevitch calls ‘the second image’, where he claims that ‘instead of being the cause of international politics, domestic structure may be a consequence of it. International systems, too, become causes instead of consequences.’ This means that China’s international policies on human rights are not only influenced by its domestic situation – stability, Party politics, and societal perspectives – but also that these domestic factors are themselves affected by the international system and, ergo, by what China agrees to on this issue with the EU. Domestic politics ‘provide an important foundation for the institutionalisation of bi- and multilateral contacts’ by providing cognitive priors – which refer to available theoretical, logical and empirical information previously held that is used to evaluate a particular situation in a context of imperfect information – for diplomats and political officials, and provide a context and the bureaucratic machinery to conduct foreign policy. (ibid) But, at the same time, according to constructivist International Relations theory, those international contacts and foreign policies ‘socialize’ political elites and promote intercultural learning and norm transposal across all social strata, with regard to any culture, not only China.
Let us analyse first the domestic influences of globalization in China. First and foremost, we have to factor in President Xi Jinping’s consolidation of power. Through a massive anti-corruption campaign, and multiple constitutional changes, he has eliminated his critics all the way from the local level up to the Politburo, and has secured his leadership role permanently, centralizing power across all policy domains, including foreign affairs, around himself. Brown argues that:
<ext> The anti-corruption struggle has a predominantly political function. […] It is a fight for the very soul of the Party, and one that ranges far beyond the figure of Xi. If it succeeds, then a fundamental part of this mandate – to create a sustainable one-party rule – will be in his and the Party’s grasp. If it fails, then the party is vulnerable to the sort of implosion that overwhelmed the Soviet Union and others. Its dream, a Party dream, perhaps even a national dream – will have failed. </ext>
We see, once again, that the boundaries between the nation and the Party, in China, are decidedly blurred.
Moreover, Xi has also stepped up repression of popular dissent, with the most egregious examples being the ‘education camps’ in Xinjiang that aim to repress the Muslim Uyghur minority and the promulgation of the new Security Law in Hong Kong. The overall aim of such actions is to preserve internal stability and avoid internal tensions. For this, other imbalances have to be addressed, including the rural poverty created by incredibly rapid urbanization and the creation of ‘super megacities’, and the demographic imbalance resulting from the One Child Policy that has led to a situation today where for every 112 Chinese men, you find only 100 women, one of the largest gender imbalances in the world.
Other major challenges include the effects of climate change – especially water and air pollution – and the lack of strong food and health regulations, combined with poor enforcement of the few regulations that do exist. China accounts today for 27 per cent of global greenhouse gas emissions, while the US contributes 14 per cent, and the EU-27 and India are each responsible for 7 per cent. In this sense, the EU has been working to promote a global approach to tackling climate change through a multilateral framework, committing with its own Green Deal to climate neutrality in 2050. This is why Xi’s pledge at the UN General Assembly in 2020 to achieve carbon neutrality before 2060 is so relevant. We thus see that climate change is a particularly important area for fruitful cooperation and global engagement between the EU and China.
Apart from popular stability at home, Xi has two other main priorities. The first is national security – which has translated into a more aggressive stance in the South and East China seas, the modernization of the Chinese military, and several conflicts with neighbours where there are disputed borders, which has led to border clashes, most significantly with India. The second key priority for the current leadership is the preservation of the socialist system under the rule of the Party. According to Shullman, this is the ‘main driver of China’s assertive influence efforts in developing countries’, which ‘both predated and in fact facilitated Xi’s elevation to power in 2012’. The foreign policy consequences of this are, for instance, the Belt and Road Initiative, which in fact has led multiple developing countries in the South East Asian region and Africa to take on an unsurmountable level of debt. This strategy has been called ‘Chinese debt trap diplomacy’ and ‘creditor imperialism’. Under it, China provides huge project-related loans at market-based rates, without transparency and much more lenient environmental and social impact assessments, with the aim of bending other states to its will. It thereby hopes to advance its strategic interests, including expanding its diplomatic influence, securing natural resources, promoting the international use of its currency, and gaining a relative advantage over other powers. In short, China uses its sovereign debt to offer grants that compel its neighbours to make political concessions, giving Chinese policymakers and investors an assurance of ‘proper behaviour’.
China also promotes its model of governance in those developing countries through a network of Confucius Institutes, university partnerships, propaganda in non-independent media and think tanks, and other cultural and educational initiatives. Likewise, as part of state-building initiatives aimed at aiding developing countries with infrastructure and economic loans, China has sent advisers and engineers to help internationalize its model of a single-party authoritarian political system that weaponizes new technologies for societal control.
Thus we see that, at some level, Xi Jinping’s foreign policy aims are affecting the way China handles domestic politics, and that in fact the two aims are mutually reinforcing and mutually dependent, even complementary. It cannot achieve domestic stability, the preservation of the Party, and full national security if they are not integral parts of its foreign policy, regionally and internationally. For the preservation of its power, which most experts argue is Xi’s main priority, the Party depends on domestic control and prosperity. That is, the legitimacy of the Party depends most of all on the country’s economic prosperity, ‘a new pillar of economic competence and the delivery of economic gains’. In a context of economic globalization, that prosperity depends on China’s economic and political stance in the world; its ability to create long-lasting partnerships and maintain security and stability in its region; and the control and manipulation of the information space to its advantage. It achieves the last of these through cyber tools and new technologies that control the information and ideologies that enter China, blocking or counter the ones that might delegitimize the country’s authoritarian model. The CCP is telling a ‘China story’ at home that is only sustainable as long as freedom of information is restrained.
We now need to factor in the effect that this internationalization of the ‘China story’ is having on the EU’s domestic politics and perspectives, especially during the COVID-19 pandemic. China used this ‘opportunity’ to conduct ‘health diplomacy’ and send personal protection equipment to some EU countries in need, especially during the chaos and stress of the first wave of the disease in early 2020. However, this has backfired because of the secrecy with which it handled the initial outbreak of the virus in Wuhan and, later, its rejection of a transparent and deep investigation of the origins of the virus by the World Health Organization, initially blocking and later constraining it. This, together with the lack of economic reciprocity in the EU–China relationship and China’s disregard for human rights and other core EU values, has significantly worsened the perceptions of China in most EU countries, as multiple surveys show.
Overall, its practices of interference through influence operations ‘to discredit the handling of the [COVID-19] crisis by specific countries, leaders, and organizations, as well as to exaggerate the ability of China to cope with the crisis domestically and provide assistance to others’, with the overall objective ‘to portray the Communist regime as an effective, socially responsible system of governance and China as a conscientious global leader’ have been undermined by its obfuscation of the origins of the virus and its disinformation campaigns on the ground in the EU. As a result, Chinese influence in the EU has been significantly weakened in most countries, and this will arguably affect these countries’ foreign policy stances, first when agreeing on a common EU strategy on China, and second when dealing with China themselves at the national level, considering that they must be accountable and responsive to public opinion. However, they will inevitably have to face a choice between the short-term economic gains that result from dealing with China and the long-term dependencies that come with the intensification of geopolitical competition between China and the West.
By applying the idea of the altered Prisoner’s Dilemma, we have seen how dependent the future relationship between China and the EU is on communication and EU mechanisms, whether institutional or more deliberative, such as the CoFoE. Thus, it is relevant to translate this theory into specific and actionable key steps that the EU should take to shape the domestic drivers that affect its foreign policy towards China and to build the ground for a practical China strategy that maximizes the potential for cooperation – that is, a strategy grounded in the EU and its Member States’ perspectives, but also in the realities that China faces at home and abroad.
Delinking values from interests
The EU should delink the discussions of economics and trade, connectivity, and climate change, on the one hand, from talks on human rights and values, and labour rights, on the other, to avoid being caught in the Prisoner’s Dilemma and to maximize benefits in both areas. This is because the rationales behind the two sets of talks are diametrically opposed, meaning that if the guiding principle is economic gain, the resulting policy options and priorities will often be antithetic to those when the goal is the pursuit and promotion of a specific value. The prevailing strategy of using economic interests to obtain gains in human and labour rights is rigid, limited, and impractical. However, Member States need to make respect for human rights a top priority again, in order to give the EU greater leverage in further negotiations with China. The CoFoE should also be used as a platform to define those value priorities, specifically in the context of dealing with China. If China does not feel compelled to engage in the talks, it will simply defect. This connects directly to getting stuck in a Prisoner’s Dilemma-like situation, the subject of the next recommendation.
The key is communication
This is in fact the main conclusion of the altered Prisoner’s Dilemma. To promote higher levels of cooperation that reduce fear and avoid being guided by greed and ending up defecting from dialogues, the EU diplomats need to abandon their belief that the Western understanding of human rights is superior and universal, because this is a non-starter. The EU needs to train its diplomats to act pedagogically and with reflection, and to engage in constructive discussion about the meaning and substance of human rights, not as something set in stone, but as a dynamic, relative concept so that we can end up finding a compromise position that both parties are comfortable with adhering to and respecting. Once this is found, it will be the starting point for further talks, compliance, and enforcement of respect for the fundamental rights of people in China.
We should also keep in mind here the idea of multispeed growth of a value-driven society, as China may in twenty years open up to the idea of fundamental rights as understood in the West. In the meantime, we have to understand that this process of adoption will be slower than in the West for philosophical, political, and societal reasons. All in all, despite being a more internal matter, the CoFoE should think about the performance of the EEAS and give it the mandate to improve internal training and develop a curriculum better tailored to dealing with China, including a building a better understanding of the cultural dimension behind the Chinese position on human rights, and equipping the diplomatic service with the cognitive tools to navigate this profound, identity-based disagreement.
Build lasting people-to-people relations through soft power
The EU should engage more strongly with Chinese civil society, taking advantage of the extent to which China has opened up over the last 50 years, and utilize China’s own cultural propaganda efforts to the EU’s advantage. On the one hand, education and culture are soft power tools that China has mastered, with its wide network of Confucius Institutes and repatriation of students who have been educated in, gained know-how from, and established lasting connections with other countries. The EU has to maintain links with the Chinese students who have studied in its universities and promote its values and culture in China through them, as well as through Europeans who work, travel or study in China, its network of delegations, Member States’ embassies, think tanks, and nonprofits active in China. It should also involve like-minded partners in the region such as Japan, India, and Australia. As a fundamentally civic – and not only political – platform, the CoFoE should include these civil society engagement strategies – not only with China but also with other authoritarian regimes such as Russia, Venezuela, and Afghanistan – in its programme.
Two-tier China Strategy
The coordination between the EU and its Member States over their China strategy is key. Ideally, there should exist a single EU-led China strategy, which is currently under development, but it is quixotic to think that Member States will abandon their own policies and outsource such an important aspect of foreign policy exclusively to the EU. Therefore, the coordination between their intelligence agencies, their China policy experts, and their China units within their respective foreign ministries is of primary importance. In a two-tier approach, the EU should focus on establishing the broad strategic guidelines, to be approved by the Council, which should then be followed by the EEAS and the Member States. The possibility of a veto in the Council has to be taken into account, and that is why I believe that such coordination should form part of a broader institutional reform, which the CoFoE itself points to, to incorporate qualified majority voting on all foreign policy decisions in the Council, to increase the decision-making flexibility of the EU and its responsiveness to a fast-changing international context. The abovementioned strategic guidelines should include respect for EU values and broad geopolitical, security, and economic priorities, to be developed and further specified by each Member State according to its own preferences. These suggestions for a China strategy and its various elements should be food for thought for the CoFoE.
Facts trump ‘fake news’
The EU should establish a ‘China intelligence unit’ dedicated to monitoring disinformation and misinformation emanating from China with the aim of influencing European society. This could be part either of IDEA (a think tank linked to the European Commission) or a new parliamentary committee. It could be composed of experts in natural language processing, big data, and artificial intelligence who would monitor news and social media originating from China or Chinese sources and identify factually misleading ones. This would require in-house investment in new skills and know-how, not only among EU personnel but also in the educational systems of EU Member States. Particular attention would have to be paid so to avoid crossing the line between keeping the EU’s politics and social climate healthy and creating a censorship unit that blocks Chinese material that ‘we do not like’. For instance, an ethical committee could oversee the unit. Instead of blocking or censoring, it could also provide factual counter-information to the Chinese propaganda and disinformation, which would at the same time increase public understanding of China. This philosophical dilemma of censorship versus the protection of democratic health should also be a topic of the CoFoE, as it should include the views of both the public and political representatives. Beyond that, the unit should also address ways to protect the EU from foreign interference through fake news, disinformation, and more direct cyberattacks.
If you would like to read more on EU-China relations, feel free to check out this other Future of Europe Journal article on the topic here.
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