Bilateral Relations Between the EU and China

“The bilateral relations between the EU and China”

Till the 1978, Peoples Republic of China (PRC) was in self employed isolation because of two things, one was Cultural Revolution and another was the transformation of the society and economy from traditional to modern. Another factor which also played a part was the Soviet threat to China after 1958 till 1983. On the other side EU was coming out of the wars and conflicts of the first half of the 20th century and making the headway for global economic power after the economic boom from 1960-1970. Though there were trade agreements between China and EU in 1978 and in 1985, however, till the end of Cold War, relations between the EU and China were at low as latter has not given high priority to relations with former, however, globalisation, and interests in multi polar world became the factors that lead to growing bilateral relations between the two. The bilateral relations between the EU and China developed and reached to its height in 2011, when train started connecting the two mighty economic and political actors of globe through Central Asian Republics. Since the bilateral relations between the two partners are still growing but there are new issues that are need the dynamism to solve the problems, human rights violations in some parts of China, and other issues like lack of transparency in China that was highlighted by EU Ambassador at WTO in June 2012, related to lack of transparency, which makes China’s trade and investment policies in the words of Secretariat’s report “opaque and complex” (EU Ambassador to WTO, June 2012). The paper will analyse

What steps have helped the bilateral relations between the EU and China?

What are the hurdles that need solutions to make the bilateral relations more powerful?

The growing interdependence after the globalisation has played a role in integration of trade, finances and people and ideas that led to speed up the bilateral relations between the countries, regions etc. According to new interdependence phenomenon regional powers, countries having different forms of government came closer to each other and start and world institutions like WTO played great role in promoting the phenomenon by replacing protectionism by free trade. The interdependence at times had made so much impact that many countries adopt policies according to international norms to trade and protect ones economy. In the conference of the Interdependence and Globalisation, Secretary-General of UN said, “There are two main aspects of forging coherence in advancing the development goals in a globalizing world economy … At the regional level; there is a need to broaden and deepen regional integration and to foster coherence through greater coordination of policies and through peer reviews While some regions have taken the necessary steps to achieve these ends, others lag Behind.”[1]

Under the following back ground and arguments about to achieve the goals of necessary steps for the relations with the other countries, regions like (EU) had taken many steps and have shown dynamism for the bilateral relations and trade particularly with the Central Asian countries and China. However, some of the countries lack behind like (China) that is not a positive sign though the Chinese government have made many changes.

Review of literature:

There is literature available on the bilateral relations between the China and EU in the form of different journals, books, reports and conference proceedings. They give the information related to trade between the EU and China and the annual high level summit held between the two. However, most of the literature is related with the trade relations and their impact on both side but about the progress in the other social problems there is stray references. The stress is not given on the peace building capacity and conflict resolution capacity of the both partners jointly or the problems which both are facing in the bilateral relations. Last but not the least to what extent they have made the world multi polar from unipolar. As one of the recent articles published by the by the European Council on Foreign Relations argues that Europe needs a “global China policy,” meaning that it should look at its relationship with China not from a traditional bilateral perspective, but rather from a global perspective that takes into account indirect effects through third countries or regions (Godement, 2010).

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History of bilateral relations between China and EU:

The bilateral relations between China and EU started after 1975 and that were further developed by the economic policy changes introduced by Deng Xiaoping in 1978. Since 1978 China has freed itself from the self imposed isolation and integrated with the world. Not only was this but the major shifts in the world economy which had left their mark on the relations between China and various European economies. The single most important events bringing about a significant reshuffle of the European economies’ economic structure and the pattern of their integration into the international division of labour have been the evolution of a single European market under the auspices of the European Union and the breakdown of socialist block the ensuing transformation of the Central and East European economies into market economies (Markus: 2002). During this period many agreements on trade and bilateral relations were signed by the two like those of Trade Agreement between the EC and China followed in 1978 (Official Journal: 1978). In 1985 this agreement was replaced by the Agreement on Trade and Economic Co-operation between the EC and China. The European Commission opened its representation in Beijing in 1988, and ever since there has been a continuous deepening of economic and trade relations. Since after the opening of the economy after 1978 and especially after the fall of USSR and globalisation, Chinese economy have become the second largest economy. On the other side EU is making it headways to became the major champion of the human rights, rule of law, democracy and is expanding its membership that made the EU major player in this global world. These events make both EU and China think about their larger interests and exchange of goods and rapid development of bilateral trade. China in 2001 joined WTO that helped the both partners to come closer to each other. After 2009 when Lisbon treaty came into force and main motives of the treaty was to overhaul the basic setup of the European Union (EU) had been to make it stronger, more visible and more assertive actor on the international scene. This institutional re-structuring which followed, notably the creation of the European External Action Service (EEAS) and EU delegations with global reach, was also intended to enhance the EU’s role and capacity in supporting peace processes, making relations with other countries more practical (Joris Larik, Catriona Gourlay). When Catherine Ashton was appointed to new post of High Representative for Common Foreign and Security Policy was welcomed by the Chinese government, as it has given China a contact at the top of the EU’s administration with whom they are already familiar through trade negotiations. Such a dynamism of both EU and China saw the fruits when the bilateral trade that in the first decade of the 21century as the EU having surpassed the United States as China’s largest trading partner ( Fox: 2009). On the one side EU has became the largest supplier of technology and equipment, in the form of FDI, and also a number of joint technology projects with China.

Apart from the good and prospective trade relations EU-China co-operation activities are also seen in the categories of measures directed in transition process to an open society based on the rule of law; support of economic reforms; business and industrial co-operation; legal and administrative reform; human resources development; science and technology; environment and energy; regional disparities, poverty alleviation and social cohesion; academic and societal activities (Franco: 2002). Cooperation has extended to other areas, with 100,000 Chinese now studying in the EU, against 60,000 in the United States, and the Chinese invited to join in a number of European technology projects, including the Galileo satellite navigation programme (Europa press release: 2003). This co operation shows the bilateral relation between the two China and EU are reaching to the new heights and levels and can be called the emergence of a new Sino‐European axis in world politics (Shambaugh 2004; Scott 2007). According to the statics of the 2012, the bilateral trade between the China and Europe reached to 443.6 billion Euros in which EU exports to China reached to its height €143.9 billion and Chinas exports to EU reached to €289.7 billion.[2] That means that one billion trade is done on the average between the two partners.

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Hurdles in the Bilateral Relations:

Though the EU China bilateral relations reached to it new heights nut there are also some hurdles that created problems many time and even when Shambaugh wrote in the International Herald Tribune (26 November 2007) that “for Europe the ‘China honeymoon’ is now over”. Starting from 1989, when because of Tiananmen Square protests for more reforms towards democratic setup and its suppression lead to the death of more than 1000 persons. Though this event does not have much impact on the bilateral relations between the two but EU with USA imposes the arms embargoes in place (Franco: 2002). Also the problems like human rights violations in Tibet, Xinjiang and Carbon emissions. These issues reached to its height and created the rift between EU and Chinas bilateral relations, when latter cancelled their participation in the annual EU-China summit in retaliation against French plans to meet the Dalai Lama in December 2008.

On the economic front the problems like dumping issues against China, and EUs response like increasing the anti-dumping tariffs of up to 50 percent on Chinese-made candles sold in the Europe have made bilateral relations somewhat more strangled(ROBERTO: 2010). In 2012, out of 100 fake goods captured on the European borders 64 were made in China that has created the larger problems. The other problems in the economic front are the China laws on the foreign companies that diminish the role of the EU companies and FDI. As for example EU investments in China add up to less than 2% of the total FDI abroad compared with nearly 30% in the United States.[3] The Chinese government also does not use country specific standards than international standards which EU companies fail or find hard to meet. Because of this in 2012, 45 % of EU companies have missed the business opportunities by these standards or regulatory barriers. Since these things need a solution and compromise between the two world largest economies for this some of the steps have been taken by the EU and China for better prospects and better bilateral relations like.

As both the EU and China have more to gain from each other than either has to lose and to overcome the issue of the human rights in China both EU and China have started dialogue from 1996 onwards one among them was on the Human rights in China (EU-China Observer, 2010). To come out of the hurdles between the two bilateral partners, they started Strategic Dialogue in 2005, held at the Vice Ministerial level and since then dialogue is held yearly for the progress and prospectus of the bilateral relations between the two and the framework of this annual dialogue covers wide range of areas. After the Lisbon treaty the dialogue is held at the direct the highest decision-making level helps maintain the strong momentum in strengthening contacts and increasing bilateral cooperation between the two partners. At the end of each summit meeting, the joint declarations reveal the new agreements reached between the two sides, which draws the blueprint and directs further the future development for EU-China relations and also serve to clarify each other’s interests and concerns. (EU-China Observer, 2010). This dialogue have given the opportunities to both the partners to known about each other’s grievances and progress on any contested issue, however, still lot has to be done in this regard.

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On the other side the growing the threats of terrorism to both partners in general and world in particular have became great problem to world peace. Although EU have made peace building process and conflict resolution there priority in their international relations after Lisbon treaty 2009. EU had send many peace keeping missions to Kosovo, Libya, Georgia, Afghanistan, Iraq, Niger, Palestinian territories and some military missions to Somilia, Atalnta, Bosinia, Mali. Both China and EU can start a new dialogue process with the leaders of the conflict areas for peace as both are considered neutral that can help in solving these deadly problems. Also EU and China can help the poor countries of the world for the sustainable human resource development and economic activities by investing jointly the technology and the finances in these countries. Although now the annual summits held between the two global partners on the security situation in Asia, from non-proliferation to the control of small arms and light weapons, from global warming and climate change to the fight against illegal migration and trafficking in human beings but still lot have to be done.

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[1] “Globalization and interdependence”, Report of the Secretary-General, United Nations General Assembly, 31 August 2004.Cf Martin Wolf, Globalisation and Interdependence, (Available online)

[2] Facts and figures on EU-China trade, Oct, 2013; http://trade.ec.europa.eu/doclib/docs/2009/ september/tradoc_144591.pdf online

[3] Karel De Gucht (7 June, 2013) EU-China Investment: A Partnership of Equals, European Commissioner for Trade, Brussels

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