Issues shaping agenda of Sino-European relations

Dr Nicola Casarini

Dr Nicola Casarini

One of the most renowned international scholars on China’s affairs, Dr Nicola Casarini from Istituto Affari Internazionali (IAI)*, speaks on  and Mr Konstantinos Papanicolaou on Sino-European relations. In particular, he focuses on the agenda of negotiations between Beijing and Brussels as well as on perspectives for 2016. Further to this, he discusses the role of China in the Middle East and its effort to possibly contribute to initiatives seeking peace.

How did Sino-European relations evolve in 2015? What are the most important issues of the common agenda?

In 2015, Sino-European relations continued to improve. Yet, the two sides tend to focus on different issues. China has continued its policy of ‘upgrading’ (shengji) relations with the EU, initiated after the landmark visit by Xi Jinping to EU institutions in Brussels in April 2014. Beijing has committed itself to increasing the political and security elements of the partnership with Brussels, while continuing to foster economic and trade relations.

Europe has responded to this by stepping up its relations with Beijing in the monetary and financial fields of policy. Such upgrading was best epitomised by the decision by Europe’s four biggest economies – Germany, France, the United Kingdom and Italy – to join the China-led Asian Infrastructure Investment Bank (AIIB) as founding members in March 2015 – despite opposition from Washington. In 2015 we also witnessed a trend towards the re-nationalisation of the political and security elements of the partnership with Beijing. Away from Brussels, it is the most important capitals, in particular Berlin and – to a lesser extent – Paris, that are now driving forward the politico-security dimension with China.

The most important issues of the common agenda are: (i) China’s initiative called ‘One Belt, One Road’ and its possible synergies with Jean-Claude Juncker’s European Fund for Strategic Investments (EFSI); (ii) The bilateral investment treaty currently under discussion; and (iii) The decision by the EU as to whether – and how – grant China market economy status in 2016. There are also political and security elements of the partnership under discussion, including the prospect of joint peacekeeping operations, the stability in Africa and the Mediterranean, the fight against terrorism, cooperation in nuclear non-proliferation.

Source: EU website

Source: EU website

What is the importance of AIIB for the future of China’s foreign policy?

The AIIB is a tool to increase Chinese influence in Asia. The new bank can be seen as an extension of the infrastructure-driven economic development policy that has sustained the growth of China since the reform and opening up era. It is based on the idea that long-term economic growth can only be achieved through massive and systematic investments in infrastructure assets, in contrast with the more short-term export-driven and consumption models pursued by many developing countries in the last decades.

In his speech at the annual conference of the Boao Forum for Asia in March 2015, President Xi Jinping stated in fact that the AIIB would foster economic connectivity and a new-type of industrialisation in the Asia Pacific area. The AIIB serves thus Chinese foreign policy in Asia in two ways: (i) It promotes China’s infrastructure-driven development model, allowing Beijing to export its domestic overcapacity abroad; and (ii) it contributes to finance – and build – much-needed infrastructure projects, hoping that this will have a positive impact on the image of China in the region at a times of growing territorial and maritime tensions with neighbours.

How do you assess the role of China in the Middle East, taking the ongoing conflict in Syria into account?

China’s interests in the Middle East relate to oil and stability. Beijing wants the oil to flow and for prices to not increase. Thus, it prefers stability. It does not want to legitimate the toppling of authoritarian regimes because of their systemic abuses of human rights since this could have implications at home, i.e. blow back on the CCP regime. Chinese leadership evaluates the conflicts in the region as complicated and difficult to solve. As a result, Beijing prefers to get on with all sides and benefit from both, pro-Assad and anti-Assad, Saudis and Iranis, Israel and Palestine, etc. Moreover, Beijing tries to act so as to be seen as even-handed, hoping that China will eventually be regarded by regional actors as a welcome peace-broker in the region, alongside – and at times replacing – the United States.

*Dr Nicola Casarini is Senior Fellow for East Asia at the Istituto Affari Internazionali (IAI) and Global Fellow at the Woodrow Wilson Center and member of the Editorial Board of The International Spectator. He is the author of the monograph: Remaking Global Order. The Evolution of Europe-China Relations and its Implications for East Asia and the United States and co-editor of the volume: European Foreign Policy in an Evolving International System. The Road towards Convergence.