Reports 2010

China-EU relations: what prospects for the next 35 years?

27 October 2010

Qu Xing, the President of the China Institute of International Studies said that EU-China relations are now at a difficult moment: the EU sees China as a world economic power, but not an equal; its trade policy towards China has become more protectionist; it emphasises Western values and a value-based diplomacy; wants a military balance in the region; interferes in internal Chinese affairs and wants China to assume international responsibilities beyond its capabilities.

However, practical cooperation could improve the relationship by using Europe’s expertise in financial services to introduce competition to China and push for market reform. Europe’s cutting edge technology could help China develop its energy sector, and could contribute to improving environmental protection in China, develop contacts between SMEs and increase cooperation in the transport sector.

Gudrun Wacker, Senior Research Fellow at the German Institute for International and Security Affairs, pointed out that China was now a member of almost every international organisation. With WTO membership it had to adapt to “the rules of the game,” but as it was expected to shoulder more international responsibility it wanted a greater say. As it has grained influence in international groupings like the G20, it might want to redress the balance so developing economies are given more space.

Ms Wacker noted that China gained many benefits from this integration and was gradually increasing its contribution to the international system, while at the same time, the country still adhered to the classical view of sovereignty and non-interference in another country’s internal affairs.

Liu Youfa, Vice-President of the China Institute of International Studies, considered that current EU-China relations were based on the incorrect belief that China and the EU are equal economic partners. The facts do not bear this out: In 2009, GDP per capita in China was $4,000, whereas the UN benchmark is $9,700. Half of the country’s GDP is attributable to Foreign Direct Investment and the average Chinese spends more than two-thirds of his/her income on food and daily necessities.

He insisted China was working towards currency reform, but this would be a long process, as the country still had a lot of catching up to do compared to the EU which had a long economic tradition.

Christopher Dent, Professor in International Relations of East Asia at the University of Leeds, predicted a move towards a multipolar world where there would be more groupings like BRIC (Brazil, Russia, India and China) and where the G20 might even become a G30 or G40. Non-state actors would be more active in international diplomacy, with more regional organisations and more hybrid bodies with state and non-state actors.

EU-China relations would be shaped by global governance developments and security concerns covering issues such as energy, climate change, health and food.