Finding Common Ground
The summit was a first occasion for the EU and China to engage bilaterally at the highest level in order to pursue constructive and stable relations. Despite the lack of enthusiastic predictions about the summit’s outcomes, some areas of mutual agreement were still found. As European Council President Charles Michel said, the “EU and China have a shared interest in a stable and constructive relationship based on respect for the international rules-based order”. President Xi complemented that “the China-EU relationship has strategic significance and implications for global peace, stability and prosperity. It is incumbent on both sides to provide greater stability for the world and stronger impetus for development”. Furthermore, as key economic partners with trade exceeding two billion EUR in goods on a daily basis, it is vital for the EU and China to preserve good relations, not only for their prosperity but also for the global community. Building mutual trust and understanding is a necessary step towards addressing their differences and “develop a right perception of each other”.
At the summit EU and Chinese leaders discussed global challenges, such as climate change and health, representing significant areas of shared interest. The EU acknowledged recent progress on the expansion of renewable energy in China, while EU officials welcomed China’s signing of a pledge on methane emissions at the COP28 summit. Both partners are also cooperating to improve health through the international pandemic treaty.
As regards the development of new technologies, the EU and China agreed to encourage cooperation on AI governance. European Commission President Ursula Von der Leyen detailed China’s commencement of a global AI governance initiative, noting that the EU is currently in the process of finalising its inaugural AI Act aimed at ensuring its alignment with fundamental rights and values. She emphasised mutual agreement to pursue global-level cooperation on artificial intelligence, despite differences in governance models.
The EU welcomed the resumption of the EU-China human rights dialogue, a platform to discuss, address and promote human rights globally. The summit saw both sides agree on restarting the EU-China High-Level people-to-people dialogue (HPPD). The dialogue gathers decision-makers and practitioners in the fields of education, culture, youth, sports and gender to share ideas and areas of cooperation. People-to-people exchanges are crucial to foster mutual understanding and trust, two aspects of the EU-China relation that have been severely impacted by the physical decoupling caused by the (travel) restrictions related to the covid-19 pandemic. The resurgence of this dialogue marks a noteworthy stride in revitalising the exchanges that decreased during the pandemic period. In addition, at the summit the EU and China discussed the events unfolding in the Middle East, aligning their focus on providing critical aid to the most vulnerable and advocating for the revival of a political process based on a two-state solution.
A pinch of controversy
Divergent viewpoints were notably centred around trade relations as the primary point of contention. The EU side called for a “more balanced economic relationship” with a level playing field and greater reciprocity, asking China “to take more concrete action to improve market access and the investment environment for EU investors and exporters”. As concerns the EU’s de-risking strategy, it clarified its intention to enhance resilience by tackling crucial dependencies in particular sectors. The Union assured China of its commitment to avoid decoupling, highlighting their mutual interest in an effective rules-based trading system centred around the WTO.
Chinese Premier Li Qiang expressed optimism for the EU to maintain openness in its trade and investment markets and urged caution in implementing restrictive economic and trade policies. Additionally, he highlighted China’s stance against the breach of fundamental market economy norms, politicisation of economic and trade matters, and the broadening of the security concept beyond reasonable limits. European Commission President Ursula Von der Leyen hinted at potential advancements in redressing trade imbalances across sectors like medical devices, cosmetics, and geographical indicators for food products.
A second point of controversy in their discussion concerned the war between Russia and Ukraine. At the summit, the EU conveyed its support for the Ukrainians and urged China to actively participate in brokering a peace initiative. As a permanent member of the UN Security Council, the EU stressed that China bears a unique responsibility in safeguarding the fundamental principles outlined in the UN Charter. The EU called for “China to use all of its influence on Russia to stop this war of aggression”, “to refrain from supplying lethal equipment to Russia and to prevent any attempts by Russia to undermine the impact of sanctions”. The discussion also touched on the situation in Gaza, Taiwan and the East and South China seas.
During the summit, the EU presented a list of companies based in China involved in supplying Russia with dual-use goods and suspected to circumvent EU sanctions. EU leaders asked China to take measures against these companies, as EU countries are planning to discuss the addition of these companies in the Union’s upcoming package of sanctions. Chinese President Xi’s response to that list was not communicated, though he did mention that both sides should “increase understanding and properly handle differences through constructive dialogue”.
A low bar for expectations
Everything considered the Summit’s main achievement may have been its taking place itself. The last in-person summit between EU and Chinese leaders dates back to April 2019, a pre-covid era representing a very different world than the one we are facing today. The 2019 summit resulted in the signing of a joint statement with both parties committing to work towards “peace, prosperity and sustainable development” and to promote “multilateralism, and respect for international law”. While the EU had designated China in its New Strategic Outlook on China as a dialogue and negotiating partner, an economic competitor and a systemic rival only a number of weeks prior to the summit, both sides agreed to enhance economic cooperation by addressing their trade imbalances, promoting fair competition, and improving market access, affirming their dedication to the development of digital infrastructure and transportation.
Since the 2019 Summit, the dynamics between the EU and China have undergone significant changes, mirroring shifts within the geopolitical landscape as well as the impact of the covid-19 pandemic. While Sino-US relations have been taking a nosedive amidst heightened competition, EU-China relations have also become more complex. Even though the EU and China remain key trading partners, trade imbalances have extended, while a trust deficit has further emanated, amidst an EU call for more transparency, reciprocity and a level playing field for European companies in China. In addition, the March 2021 EU sanctions imposed on four Chinese individuals and one Chinese entity related to human rights violations in the Xinjiang Uygur autonomous region, and the consequent Chinese counter-sanctions on ten individuals and four entities in the EU – including Members of the European Parliament and of the Council’s Political and Security Committee – have had a severe impact on EU-China ties, thus putting the Comprehensive Agreement on Investment (CAI) on hold. Both parties are also involved in a World Trade Organisation (WTO) dispute over a Chinese embargo on exports from Lithuania.
Yet, their bilateral trade deficit has doubled within a span of two years and has reached almost 400 billion EUR. According to the EU, this surge is attributed to China’s domestic policies of restricting market access and manufacturing overcapacity thanks to illegal subsidies. Brussels has therefore started to investigate subsidies in China’s electric vehicle sector while also considering actions against Chinese state subsidies in critical areas like wind turbines, medical technology and solar equipment.
Despite the differences, China and the EU continue to bolster their relationship through ongoing dialogues, with several EU commissioners and EU leaders having visited China following the lifting of pandemic restrictions, and Chinese officials having made the trip in the opposite direction since German Chancellor Scholz re-opened the dialogue season with his visit to China in November 2022, shortly followed by EU Council President Charles Michel’s visit to Beijing on 1 December 2022. For instance, Virginijus Sinkevičius, European Commissioner for Environment, Oceans and Fisheries, visited China from 22-26 September 2023 to follow up on the High-Level Environment and Climate Dialogue held on 4 July 2023. Both sides held key discussions on biodiversity, ocean governance, environment and water. Commissioner Sinkevičius, alongside Zhao Chenxin, Vice-Chairman of China’s National Development and Reform Commission (NDRC), launched the first High-Level Dialogue on Circular Economy in Beijing. During this dialogue, they reached a consensus to renew the Memorandum of Understanding on Circular Economy initially signed in 2018.
Cooperation on climate was also discussed at the EU-China strategic dialogue held on 20 October 2023, which was co-chaired by High Representative of the EU, Josep Borrell, and Chinese Foreign Minister Wang Yi. The dialogue provided an opportunity to explore critical dimensions of the China-EU relationship, ranging from economic ties to security matters and potential areas for cooperation.
Moreover, European Commission Executive Vice-President, Valdis Dombrovskis, and Chinese Vice Premier of the State Council, He Lifeng, co-chaired the 10th EU-China High-level Economic and Trade Dialogue on 25 September 2023. They engaged in discussions covering economic and financial affairs, with a particular focus on agreeing to establish technical communication channels regarding export controls. Additionally, they aimed to sustain the potential for an EU-China transparency mechanism concerning supply chains for raw materials. Furthermore, several high-level meetings between Member States and Chinese leaders were held with the Spanish Prime Minister, Sánchez Pérez-Castejón, French President, Emmanuel Macron, and the German Foreign Minister, Annalena Baerbock, visiting China throughout the year.
As it is essential to maintain open dialogue channels, China and the EU could pursue additional high-level agreements by focusing on practical/more technical collaboration, tackling global challenges. The summit’s main success was encapsulated in its taking place, offering a forum for discussion and dialogue after four long pandemic years and online discussions.
Going forward
Notwithstanding the complexities and challenges facing EU-China relations, the summit highlighted the necessity for a more balanced trade relationship. This underscores the importance of maintaining continued high-level dialogues, crucial for nurturing trust, addressing critical concerns, and fostering collaboration on shared interests between China and the EU. Furthermore, the High-level Dialogues focusing on Environment and Climate, Circular Economy, and Economic and Trade are key to the advancement of EU-China relations, while fostering the need to initiate dialogues in crucial domains, like on emerging technologies. The EU-China summit revealed critical areas for enhanced cooperation particularly in the fields of climate change and new technologies, both at the multilateral and bilateral level.
Given the shared crucial interest in tackling the climate crisis, further areas of desired closer collaboration exist in this domain. EU Commissioner for Climate Action Wopke Hoekstra met with China’s Special Envoy on Climate Change, Xie Zhenhua on 16 November 2023 in Beijing to prepare for COP28 in Dubai. Discussing key issues on the COP28 agenda, they agreed to work more closely together, enhancing the alignment of their climate ambitions, fostering greater cohesion and bolstering negotiation efficiency in multilateral meetings. Bilateral cooperation on climate should also be pursued on issues such as carbon pricing and the implementation of the EU’s Carbon Border Adjustment Mechanism (CBAM), measuring and reducing methane emissions, and scientific analysis. Moreover, the EU and China could agree on joint actions on the African continent, requiring immediate climate adaptation strategies, alongside ensuring food security and fostering sustainable economic growth. The EU, as the world’s leading source of international climate finance, and China, a significant investor in renewable energy, can collaborate and leverage their expertise to enhance the resilience of other nations, like in Africa, in facing the challenges posed by the climate crisis. Potential closer collaboration or coordination between the EU’s Global Gateway strategy and China’s Belt and Road Initiative could potentially provide a platform to facilitate such cooperation.
In light of greater transparency and dialogue, cooperation on the development of new technologies could also be enhanced between China and the EU. As they have agreed to collaborate on AI governance during the summit, such progress can pave the way for exploration into more sensitive cooperation areas in the future. An agreement was also reached to ease cross-border flows of non-personal data during the 10th EU-China High-level Economic and Trade Dialogue, discussions on flows of personal data could therefore follow. Establishing trust will be pivotal in this pursuit, while strengthening collaboration on technology in sectors such as agriculture and sustainable urbanisation could help serve as a catalyst in fostering the essential trust needed. Moreover, the EU and China could take the lead in advancing multilateral collaboration to define regulatory frameworks around these emerging technologies. For instance, they have already agreed to collaborate with the U.S. in managing the risks associated with AI technology at a summit held in the U.K. on 1 November 2023.
Even though the December 2023 EU-China summit did not lead to any major agreements, considerable achievements or a joint statement, it was a valuable occasion to resume the in-person dialogue and exchanges at the highest level and restate the importance of upholding stable and mutually beneficial ties. The EU and China maintain key trade relations as well as shared interests, especially in tackling global challenges and the development of new technologies. Even though points of contention exist between the EU and China and there is a growing level of complexity in the relations between them, the summit provided a platform for discussion and deescalation at the highest level. With the EU elections in sight this was the last summit held under the current EU leadership. Yet, the path for continued dialogue has been paved for the incoming leadership after the June 2024 EU election. Despite the complexities in their relations, their interdependencies, trade ties and the international global order have proved the need for China and the EU to work together.
Author: Dilara Kasikci, EIAS Junior Researcher
Photo credits: Flickr