EU on brink: Bloc ‘ill-equipped’ for US-China stand-off as row erupts over Beijing pact

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Negotiations over an EU-China trade agreement were initially approved on New Year’s Eve, after talks between Chinese President Xi Jinping and the European Commission President Ursula von der Leyen proved successful. After its confirmation, outrage was sparked within Washington as it feared a new deal could “complicate policy” between Brussels and the US. This could lead to major issues for the bloc as it struggles to maintain ties with both wealthy nations.

Other criticisms included China’s demand to have access to the EU’s energy sector, with some political analysts – including Phar Kim Beng, claiming such an agreement “exposes European weakness”.

The weaknesses described were also exposed by Brussels’ former trade negotiator Cecilia Malmstrom, who said her time working for the EU had demonstrated that the bloc was unable to cope with the likes of China and the US.

She explained that for the bloc to further its influence it “needed to be tougher”, while ensuring it had a more “centralised foreign policy and stronger rules to ensure EU companies could compete” on level terms with their global counterparts.

Ms Malmstrom worked in Brussels for five years, but said “for all its successes, the EU is not really equipped to deal with a changing world”.

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In 2019, Ms Malmstrom, who describes herself as a “proud liberal” told the Financial Times that the EU had “serious thinking” to do about how it should tackle “this aggressive China”.

The talks between China and the EU began in 2014, and the new pact is described by the European Commission as a deal that “will create a better balance” in trade relations.

In a statement after the deal’s proposal was announced, the Commission added Brussels has “traditionally been much more open than China to foreign investment… but China now commits to open up to the EU in a number of key sectors”.

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Major players in Washington were left furious with their European counterparts, particularly their decision to ensure a pact is made while the US readies itself for a new administration to enter the White House.

President-elect Joe Biden is set to enter office in the coming days, and politicians across both the Republican and Democrat parties snapped at Brussels.

Matt Pottinger, incumbent US President Donald Trump’s deputy national security adviser, said in a statement this month: “Leaders in both US political parties and across the US government are perplexed and stunned that the EU is moving towards a new investment treaty right on the eve of a new US administration.”

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He also warned of damage between relations, arguing “there is nowhere for bureaucrats in Brussels or Europe to hide”.

Mr Pottinger added: “We can no longer kid ourselves that Beijing is on the verge of honouring labour rights, while it continues to build millions of square feet of factories for forced labour in Xinjiang.”

Mr Biden’s nominee for national security adviser, Jake Sullivan, claimed the new administration wanted “early consultations with our European partners on our common concerns about China’s economic practices”.

Writing in the South China Morning Post, Mr Beng argued the agreement had “exposed the EU as a weaker economic and geopolitical actor”.

Even insiders in Brussels were furious, including Reinhard Bütikofer, chair of the European Parliament’s delegation for relations with China, who claimed that the deal was “misguided”.

Writing on Twitter, he added: “It helps EU sovereignty more if we demonstrate that we know when to stand tall to China. And to align with partners.”

Among the main forces behind securing the deal was German Chancellor Angela Merkel.

It emerged that she was aiming to get a deal secured as Germany is one of China’s biggest car exporters, and in recent times the industry in Berlin has been close to crumbling.

Political commentator Gideon Rachman reported in the Financial Times this week that while some “arguments are reasonable enough”, Brussels could be struck by the US later down the line.

He added: “It is hard to look at current events in Washington and feel totally confident about the stability of the US or the Atlantic alliance. A European desire to avoid military confrontation in the Pacific is also rational.

“But relying on an American security guarantee in Europe, while undermining American security policy in the Pacific, does not look like a wise or sustainable policy over the long run.”

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