European Union foreign ministers agreed Monday on an ambitious global infrastructure plan linking Europe to the world.
The infrastructure scheme is designed to rival Chinese President Xi Jinping's Belt and Road Initiative, which Western governments fear encourages countries to take on large Chinese loans that can then be leveraged by Beijing for political purposes.
“We see China using economic and financial means to increase its political influence everywhere in the world. It's useless moaning about this, we must offer alternatives,” German Foreign Minister Heiko Maas told Reuters as the foreign ministers’ summit concluded in Brussels.
Brussels has already inked partnership deals with India and Japan to coordinate transport, energy and digital projects connecting Europe and Asia. Tokyo and New Delhi have also voiced worries about Chinese infrastructure loans making poorer countries beholden to Beijing and have warned about Beijing using commerce as a tool for statecraft and a means to expand political clout.
Montenegro, a member of NATO and a candidate to join the EU, is cited by Western diplomats as the latest casualty of what they call China’s “debt-trap diplomacy.” The Balkan country borrowed nearly $1 billion from China in 2014 to fund a Chinese-built 41-kilometer stretch of highway outside the capital, Podgorica. The loan has driven Montenegro deep into debt and is threatening to wreck its economy.
The EU infrastructure plan mirrors a similar pledge the Group of Seven richest democracies made last month to back infrastructure partnerships, using Western development bank loans and first-loss guarantees to private companies, to rival the Belt and Road Initiative, often nicknamed the New Silk Road.
The West’s new assertiveness
Monday’s initiative continues a recent phase of greater assertiveness by the EU towards China. It follows diplomatic efforts by US President Joe Biden to cajole European allies to take more aggressive action against China, including on forced labor practices, breaches of international trade rules as well as over what Washington sees as Beijing’s problematic global infrastructure financing schemes.
And Mr. Biden has urged America’s European allies to shape a much more united defense of democracy and human rights. China’s crackdown on Hong Kong and on its Uyghur minority in the province of Xinjiang led in May to EU lawmakers stopping ratification of the Comprehensive Agreement on Investment, a trade deal between the EU and China which was signed just in December.
The EU has imposed sanctions on Chinese officials for rights abuses, prompting retaliation by Beijing, which in turn penalized several EU lawmakers and officials.
President Xi earlier this month said in a nationally televised speech marking the 100th anniversary of the Chinese Communist Party that Beijing would no longer listen to “sanctimonious preaching.”
He warned: “We will never allow anyone to bully, oppress or subjugate China. Anyone who dares try to do that will have their heads bashed bloody against the Great Wall of Steel forged by over 1.4 billion Chinese people.”
The EU national governments are far from united in their thinking about China.
German Chancellor Angela Merkel and French President Emmanuel Macron are seeking to revive the stalled investment deal with China and have been emphasizing the need for cooperation with China, saying Beijing’s assistance is crucial for global efforts to reverse climate change and overcome the coronavirus pandemic.
Luxembourg's foreign minister Jean Asselborn cautioned Monday against making China an adversary.
Formally, the EU’s strategy towards China seeks to balance relations with Beijing and Washington. The approach focuses on tackling “specific challenges posed by China without pursuing an outright political confrontation,” said Grzegorz Stec, a EU-China expert in a paper for the Royal United Services Institute, a British research policy group.
He notes that a year ago EU diplomatic chief Josep Borrell “remarked that in managing its relationship with China the EU ‘should be like Frank Sinatra’ and pursue ‘my way,’” but he adds, “the Sinatra doctrine has faded over the past year” with debate under way over China taking place between EU member states. “The outcome may well be a more assertive Europe,” he says.
Others want the Sinatra doctrine to fade faster. Lithuania and a group of smaller EU countries have been calling for at the adoption of a much tougher policy towards Beijing.
Last week, Lithuania’s foreign minister, Gabrielius Landsbergis, complained of Franco-German dominance in deciding EU-China relations. Lithuanian President Gitanas Nausėda has called on European Council President Charles Michel to organize a strategic discussion on China among the 27 EU leaders. In a letter to Michel, first reported by Politico.eu, a Brussels-based new site, Nausėda said: “Regrettably, in recent years China has become less of a cooperating partner and more of an unfair competitor and a systemic rival.”
Pepijn Bergsen, a research fellow at Britain’s Chatham House, says the EU is likely to continue to try to pursue a balancing act between Washington and Beijing for economic reasons and to avoid being drawn into a geo-political tussle. But he says it is a strategy that is unsustainable in the long run.
“While wishing to remain neutral between the two is understandable, particularly from an economic perspective for countries such as Germany, this is likely to turn out to be a difficult balancing act,” he said in a paper released last week.
This report includes information from Reuters and Politico.