China unites America and Europe in alarm
But they don’t agree on the solution
Reminders of a wicked world are multiplying at the Arvfurstens Palace in Stockholm, stately seat of Sweden’s foreign ministry.
A bronze briefcase, bearing the initials rw, has for some years stood outside the front door.
It honours Raoul Wallenberg, a young diplomat who used his country’s profitable—and at times shameful—tradition of neutrality to save thousands of Jews in Nazi-occupied Hungary with Swedish “protection passes” he had crafted, before he vanished into the prisons of the Soviet Union.
Of late, four large flags also adorn the stone-floored entrance hall.
Three reflect Sweden’s proud self-image as a champion of free trade, development aid and international co-operation.
These are the Swedish flag, the flag of the European Union and the United Nations standard.
The fourth is new: the flag of nato, the defence alliance that Sweden joined in March.
The country was jolted out of 200 years of neutrality by Russia’s invasion of Ukraine.
Russian aggression led Sweden (preceded by Finland, which joined nato a few months earlier) to bind its security, formally, to that of the American-led West.
Sweden’s resolve, and that of like-minded European governments, has been strengthened by what China did next.
In late May Chaguan attended the Stockholm China Forum, a closed-door meeting of American and European officials, business executives and analysts, as well as Chinese scholars.
Your columnist has attended these forums since 2008.
This one stood out for a convergence of views over the challenge that China poses to the global security and economic order.
Participants expressed alarm over China’s support for Russia’s arms industry.
They reported the seeming indifference of Chinese leaders when told by Western visitors that help for Vladimir Putin’s war machine undermines security in Europe.
China has so far paid no real cost for its supplies of dual-use components that go into Russian missiles, drones and tanks, the gathering heard.
Instead, Chinese diplomats offer Europeans bland denials, Kremlin talking-points about the West provoking the war, and what a participant called implicit hints that “you should be glad we are not doing more”.
Speakers described unsubtle Chinese attempts to split Europe from America, and to play divide-and-rule among eu member countries.
The forum heard of a Chinese visitor telling a European official, in effect: Donald Trump will be back in the White House, Russia is winning on the battlefield, so why not dump Ukraine and come with us?
There was much talk of Europe’s interests beyond its neighbourhood.
In an on-the-record speech to the forum, Sweden’s foreign minister, Tobias Billstrom, called Russia’s invasion an “irreversible turning-point” for Sweden’s foreign and security policy.
He added that his country has a national interest in a stable Indo-Pacific, including in the Taiwan Strait.
“If international law is called into question in one part of the world, that concerns all of us,” explained the minister.
In EU debates about whether to impose tariffs on Chinese battery-powered cars and other green technologies, Sweden joins a free-market camp worried that France and other advocates of tariffs may trigger a full-blown trade war.
But even free-trade champions like Sweden back “de-risking” with China, meaning measures to reduce dangerous dependencies that harm economic security.
Alas, China has no intention of co-operating. Its ruler, Xi Jinping, calls it a useful deterrent for countries to be dependent on China.
More broadly, he and his aides concede no ground when European leaders ask about overcapacity in key export sectors.
For all the signs of convergence between America and Europe, important differences may be seen.
The EU calls China “a partner for co-operation, an economic competitor and a systemic rival”.
It matters greatly that this tripod has now gained a fourth leg, with several Europeans in Stockholm declaring China a full-blown security threat.
Yet it also matters, a lot, that America’s vision of relations with China has lost its leg marked “partner”.
The Biden administration is still trying to avoid conflicts and to co-ordinate work with China on climate change, drug-smuggling and other global issues.
Examples of active co-operation are now rare.
Then there is the election in America this November.
The China agenda of a new Trump administration would overlap on trade with Biden-era policies.
But the forum heard of ways in which political tensions could soar unpredictably, for example if Mr Trump appoints China hawks who release American intelligence on the wealth of Chinese leaders and their families, or impose entry bans on Communist Party officials.
That would stoke fears in Beijing that America is bent on all-out regime change.
Economic security v national security
On trade, big differences loom. Europe still wants China to grant more reciprocal market access.
American officials are more focused on tariffs, tougher investment-screening rules and export controls.
Several European governments are wooing Chinese electric-vehicle (EV) makers and battery manufacturers to open plants in their countries.
In effect, they will accept dependency on China in strategic industries as a price worth paying for new jobs and affordable green technologies.
On the American side, with the Biden administration imposing 100% import tariffs on Chinese EVS, the logic is closer to decoupling.
Leaders of both American political parties have little or no faith in the World Trade Organisation, seeing it as unable to constrain unfair Chinese practices. Most European governments are not ready for a post-wto world.
Despite that convergence, Europeans see no way to stabilise the world without engaging with China as a partner.
In contrast, America increasingly sees China as a bad actor whose ambitions will make the world worse.
On the sunniest Stockholm day, storm clouds lurk.
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