Global Europe Brief: EU’s counter-project to China’s Belt and Road

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For a long time now, Western diplomats in the EU and beyond have kept tabs on China’s Belt and Road Initiative (BRI), an ambitious infrastructure project that harks back to the ancient Silk Road, with a vast collection of development and investment initiatives that stretch from East Asia to Europe and beyond.

Launched in 2013 by President Xi Jinping, it significantly expanded China’s economic and political influence, but in Europe it has created uneasiness through debt traps (Montenegro most recently) and massive investment in critical infrastructure worldwide.

Experts see the BRI as one of the main pillars of bolder Chinese statecraft under Xi, a pushback against the US’ ‘pivot to Asia’ and a recipe for a looming Chinese economic middle-income trap.

EU foreign ministers are on Monday set to sign off on a counter-scheme to the BRI, under the bulky title of ‘Connecting Europe Globally’.

Efforts will include a list of “high impact and visible projects”, to be drawn up in the next nine months, in addition to its 2018 EU-Asia connectivity strategy to move towards a “globally connected” EU with Africa and Latin America, and a soft power communication drive with a shiny logo and (hopefully) catchy name.

“The Council notes that other key economies have developed their own approaches and tools for connectivity and underlines the need for all such initiatives and actions to apply high international standards,” say the conclusions, seen by EURACTIV, and add that the EU’s chief diplomat, Joseph Borrell, is “to proceed swiftly with the implementation” of the idea.

According to EURACTIV information, EU ambassadors had agreed on the conclusions without changes in the text.

EURACTIV understands that the European Commission is cooperating with the European External Action Service and various Commission services on how to proceed on the basis of the Council’s conclusions and will look for ways to work with member states to mobilise public and private sectors, and provide a legal and economic framework for investment in different parts of the world.

A final version of the communication is expected to be announced during Ursula von der Leyen’s State of the Union address in autumn.

But will this idea fly?

EURACTIV understands that there is currently a lack of clarity in the European approach and in how it distinguishes itself from the US and Chinese approaches.

The main political push for the EU to have an overall strategy comes from the member states, notably France and Germany, but some sources say that due to different geographical (and economic) priorities, the final proposal could be diluted.

It could also potentially lead to a clash between Berlin and Paris over which regions to focus on, what initiatives to support and with what amount of money, an EU source told EURACTIV.

At the same time, several EU diplomats have pointed towards a lack of reference in the conclusions to a budgetary line for the initiative and a weak encouragement for EU companies to engage in strategically important but economically risky locations.

“How do the human-centric approach and the sustainability aspect translate to international connectivity remains to be seen. Europe still needs to define which countries to deal with, how, and what these countries will get out of it,” the source added.

“To succeed the EU’s scheme will need a strong narrative, credible resourcing, political commitment, and far less fragmentation than previous, more tentative efforts,” Andrew Small, senior transatlantic fellow with the European Council on Foreign Relations (ECFR), told EURACTIV.

This would require countries and investors understanding what it is and how to tap into the financing, which is easier said than done, and political commitment is required to break down the bureaucratic silos and provide clarity and strategic direction, Small said.

“There are plenty of people in the EU system who have thought very seriously about all these questions and know what needs to be done, including on various ingenious ways of mobilizing finance – now they need to be backed properly,” he added.

Looking beyond Europe, while Russia has become one of the BRI’s most enthusiastic partners, other third countries, most notably India and Japan, have sought to balance their concerns about China’s ambitions against the BRI’s potential benefits.

At the same time, the EU Chamber of Commerce in China recommended Europe should review its internal regulations, fashion shields to protect itself from BRI-related market distortions and push for reciprocity with China.

Asked by EURACTIV whether the new scheme could impact Chinese business opportunities for Europe, the chamber said “the EU needs to play a more active role on the global stage, and repeat its own connectivity miracle across other regions while adjusting its own rules to counter China going global”.

“At the same time, it is imperative that the EU remains fundamentally open to private investment and ensures legitimate, Chinese private investment can continue to follow market forces in the European economy,” it added, which would “go without saying that the EU should continue to expand cooperation with China on areas of shared bilateral interest, such as climate change, biodiversity, energy and international development”.

And what will the Chinese do?

Asked about Beijing’s views of the leaked plans, the Mission of China to the EU told EURACTIV they are not yet in a position to comment and are awaiting the official EU announcement on the matter.

– Luca Bertuzzi contributed reporting to this article.


EU IN THE WORLD

OLYMPICS BOYCOTT? Olympic boycotts have happened a handful of times for a variety of reasons, most notably when the United States led a boycott of the 1980 Moscow Olympics to protest against the Soviet invasion of Afghanistan.

The European Parliament now has called for the EU to boycott the 2022 Winter Olympics in Beijing unless China improves the human rights situation in Hong Kong and in the Xinjiang province, home to the Uyghur Muslim minority.

HARD OR SOFT? Slovenia’s Prime Minister Janez Janša has told the country’s parliament that the EU must come up with strategic answers to strategic challenges, working both on its soft and hard power to become a major player regionally and globally. Well, we’ve heard this before, haven’t we?

THREE SEAS. Bulgaria is this year’s summit host of the Three Seas Initiative (3SI), designed to promote cooperation between 12 European nations and their partners in energy, transport, and digital sectors. It will also focus on the current situation in Ukraine and Belarus, as well as Bulgaria’s position on the future enlargement of the EU. Germany wants the US-fostered Three Seas Initiative (3SI) to become part of European policy and investment instruments.

This, however, comes at a very inconvenient time – just before the snap general elections to be held in Bulgaria on Sunday. It’s not great when geopolitics interferes with politics, writes Georgi Gotev.

TRANSATLANTIC LINK

STAND-IN AMBASSADOR. Career diplomat Kelly Adams-Smith is Washington’s new deputy ambassador to the EU and chargé d’affaires. She most recently served as a senior national security staffer for Vice President Kamala Harris, having been stationed as a diplomat in US embassies in London and Prague. She worked for former US President Barack Obama, serving on his National Security Council. Adam-Smith will stay on the job until Biden nominates and the US Senate confirms a new fully-fledged ambassador.

DEFENCE CORNER

EU-NATO. NATO leaders in June emphasised a desire to deepen dialogue and practical cooperation with alliance partners, including the EU and those in the Indo-Pacific (Australia, Japan, New Zealand, and South Korea).

A reinvigorated, strategic EU-NATO partnership is essential to address the security challenges facing Europe and its neighbourhood, stress MEPs in a report adopted this week. They also emphasised the need for coordinated transatlantic strategy towards Russia and China.

JET SCRAMBLE. A press conference involving the prime minister of Spain at a Lithuanian NATO base was suddenly plunged into disarray on Thursday when pilots scrambled two fighter jets to respond to an alert that an unidentified aircraft had carried out an incursion over Baltic skies.

ENLARGEMENT LATEST

SEEKING COMPROMISE. Slovenia’s President Borut Pahor met his Bulgarian counterpart Rumen Radev to discuss Bulgaria’s veto on North Macedonia’s bid to join the EU. The presidents are personally committed to seeking a compromise solution that would pave the way for the start of North Macedonia’s EU accession talks, Pahor’s office said.

MEDIA WOES. The election of Armela Krasniqi as chairwoman of Albania’s Audiovisual Media Authority (AMA) by parliament with 83 votes in favour has sparked criticism from the EU office in Tirana.

YOUTH EMPLOYMENT. EU employment and social affairs ministers and their counterparts from the Western Balkans met in Slovenia for talks on measures to get young people into the labour market, with regional officials calling for the implementation of a youth work guarantee scheme.

EURASIA DIGEST

MINSK PRESSURE. The EU “speaks with one voice” in condemning a decision by Belarus to allow illegal migrants to cross into Lithuania in response to EU sanctions, European Council President Charles Michel said earlier this week during his visit to Vilnius. Lithuania, meanwhile, is due to start building barbed wire fencing on the border with Belarus.

GEORGIA RALLIES. Thousands rallied in the Georgian capital Tbilisi this week to denounce attacks on the LGBTQ community that shocked the Caucasus nation and forced activists to cancel a planned Pride march.

STABILITY DIVIDEND. The security situation in Afghanistan has been deteriorating since the US and its NATO allies withdrew their troops after more than 20 years of commitment. A high-level meeting next week in Uzbekistan’s capital Tashkent to discuss connectivity is a stability dividend and a timely opportunity to convince countries that the international community is not abandoning the region following Afghanistan withdrawal.


WHAT ELSE WE’RE READING 

ON OUR RADAR FOR THE NEXT FEW DAYS…

Europe’s everyday business is still stuck in lockdown reality, until further notice. We’ll keep you updated on all relevant EU foreign affairs news, as Europe is slowly moving towards summer break.

  • Bulgaria’s parliamentary elections (watch out for Sofia-Skopje signals)
    | Sunday, 11 July 2021 | Bulgaria
  • Foreign Affairs Council
    | Monday, 12 July 2021 | Brussels, Belgium
  • European Parliament’s Security and Defence Committee (SEDE)
    | Mo-Tue, 12-13 July 2021 | Brussels, Belgium
  • EU-Bosnia Council
    | Tuesday, 13 July 2021 | Brussels, Belgium
  • European Commission Vice-President Maros Sefcovic in Ukraine
    | Tuesday, 13 July 2021 | Kyiv, Ukraine
  • European Parliament’s Foreign Affairs Committee (AFET)
    | Wed-Thu, 14-15 July 2021 | Brussels, Belgium
  • Biden hosts Germany’s Merkel at the White House
    | Thursday, 15 July 2021 | Washington, United States

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PAST EDITIONS

[Edited by Benjamin Fox]

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