Conférence UE-Chine : éprouver les liens malgré les temps difficiles[en] 

On 26 November, the Chinese government told the French EU Presidency that Prime Minister Wen Jinbao would not be travelling to Lyon for the 1 December summit, which was expected to focus on China's huge trade surplus with the EU as well as coordinating a global response to the financial crisis. 

The Chinese "based their decision on the fact that the Dalai Lama will be visiting several EU countries at the same time and will meet with heads of state and government as well as presidents of European institutions," the EU said in a statement. 

China's decision was perceived in Brussels as ill-fated, showing that China's Communist leaders consider isolating Tibet and the Dalai Lama a bigger priority than enhancing the Sino-European "strategic partnership". 

The conference, organised by ECAN, the EU-China Academic Network, featured substantial Chinese academic, economic and diplomatic representation despite the abruptly cancellation of the annual EU-China summit, which was due to be held on 1 December (EurActiv 27/11/08). 

Speaking to the audience, Song Zhe, China's ambassador to the EU, described what had happened as "unfortunate". But he expressed hope that the setback would trigger "cool-minded reflection" about EU-China relations. 

The ambassador called on the West to pay more respect to issues "of core interest" to China. "When it comes to the questions involving sovereignty and territorial integrity, there is no room for compromise and concession for China. Applying pressure on China on issues of this kind by whomever and in whatever form is not wise, nor will it work, and it will only end up hurting our common interests," said Song. 

Academic conference 'not ideological' 

Fraser Cameron, ECAN's project manager, told EurActiv that in no way had the cancelled summit negatively impacted upon the conference. He called it a "very successful" event and categorically insisted that the messages of the Chinese participants were not politicised. 

"That was the ambassador's role. The Chinese experts produced inputs on different aspects of political and economic developments in China, focused on issues as the role of sovereign funds, the importance of clean technology and prospects for future EU-China cooperation. It was not at all an ideological confrontation, it was very much looking forward, and I think we should do more of this to reduce misperceptions on both sides," Cameron stated. 

Giuseppe Balducci, a researcher at the College of Europe, argued that Europe's failure to promote human rights in China was a consequence of the complicated institutional settings of the European foreign policy decision-making system. EU countries also have heterogeneous interests when it comes to the promotion of human rights in China, Balducci said. In his view, all this led Europe, in the specific case of China, to become a "normative trap" rather than a "normative power". 

But the main focus of the conference was economics. Most speakers observed that a comparison of notes from previous ECAN conferences revealed that China was now transforming its business system rapidly. The country has a genuine interest in a peaceful world so it can focus on its internal development, they noticed. 

According to Jonathan Story, a professor  at INSEAD business school  in Fontainebleau, the further transformation of China's business system is key to its insertion, satisfactory or otherwise, into world trade. 

"That transformation spells further adaptations, which in the longer run amount to regime change towards constitutional governance - China-style," he said. On the other hand, he observed that for the rich powers of the developed world, the choice was "between putting up the barriers against China, as the anti-globalisation forces at work in their societies want, or treating China as a pillar of the global system, and agreeing on a gradualist policy of transition to a fully fledged market -democracy". 

David Scott  of Brunel University dwelled on China's positions on climate change. "The technology angle remains central for China, with the EU able to provide technology transfer and supportive research for green technologies in China, which are then able to be manufactured on a relatively cheap mass scale in China; to the benefit of China, but also of the EU," Scott argues. 

"The way forward is to strengthen and expand (1) EU-China environmental cooperation projects, and (2) strengthen and expand appropriate technology development-and-transfer and effective mechanisms like a reformed-redirected CDM Clean Development Mechanism, which push clean alternative non-hydro renewable energy sources. Such environmental avenues are worthy, achievable and may be a particular win-win path for the EU and China to push forward on. Environmental issues are thus a strategic key in China-EU relations, if handled correctly and if pushed forwards more from their present base. They are too important for the EU and China to fail on. That is the biggest imperative for the future," said Scott in his presentation. 

Alejandro Carballo  of the University of Valencia analysed Chinese sovereign wealth fund (SWF) strategies. The China Investment Corporation (CIC), officially launched in September 2007, attracted a lot of criticism from concerned Western countries. As a result, the US and some European countries such as Germany (contrary to the position of the European Commission) are drafting tighter regulations for SWF investments, Carballo recalled.

"WFs have been operating for more than 50 years without giving raise to any special concern or creating problems to the global economy […] The recent appearance of the CIC cannot be considered as a different case […] Therefore, instead of blindly focusing on imposing tight regulations on the CIC, the European Unionshould open a bilateral dialogue with China in order to reach a common agreement in drafting best-practice guidelines for bilateral investments," Carballo argued. 

Antoine Sautenet, a research fellow at the Institut Français des Relations Internationales (IFRI), focused his contribution on intellectual property rights (IPR). 

"Intellectual property rights theft remains a huge problem for European businesses in China. Almost 60% of all counterfeit goods seized at European borders in 2006 came from China […] In 2007, European manufacturers estimated that IPR theft cost them 20% of their potential revenues in China," Sautenet said. 

He then reviewed efforts by the Chinese authorities to take aboard WTO rules also in the IPR field, observing that "while the objectives of the Chinese authorities are perfectly understandable and welcomed, the means used to achieve this end are not always legitimate". He further explains: "Methods employed by the Chinese government can be both direct and indirect. Direct absorption of foreign IP includes the flat refusal to pay royalties to foreign patent owners and the forced disclosure and dissemination of secret data. The more indirect method on the other hand, relies on the use of government procurement practices where foreign companies are selected initially in order to pass their technological know-how to a joint venture partner and are then excluded from successive rounds." 

Professor Dai Bingran of Fundan University in Shanghai was confident about the EU's ability to face the current huge trade imbalance with China, saying the solution was "to increase EU exports to China" instead of curbing Chinese exports to Europe. 

"The EU has an advantage in high tech products," said Bingan, citing low-carbon technologies as an example. Increasing exports of these types of products "would address a great part of the imbalance," said the scholar, who won the EU's Jean Monnet prize in 2008. He cited energy, transport and financial services as areas where China could benefit from the expertise of European firms. 

Bingran was also critical of the EU's attitude towards China on trade policy. The EU refused to grant market economy status to China but did so with Russia, he noted, saying this amounted to "double standards" and "discrimination". 

On human rights, Bingran admitted that the situation was "not as good as it should be". But he stressed things had improved tremendously over the past 30 years and the Cultural Revolution. "I would not be here to say things like that today," without the Cultural Revolution, Bingran noted, asking Europe to be "a little patient" and "a little tolerant".