The Xi-Macron meeting will make a splash but Chinese EV and battery manufacturers’ plans in Hungary and Serbia are also shaping the China-EU dynamic in important ways.
Although new EU measures covering environmental, human rights and anti-subsidy concerns threaten Chinese business interests, EU and Chinese leaders, braced for Trump 2.0, have reason to keep tensions from boiling over.
The US is increasing economic pressure on Russia over its invasion of Ukraine but is growing frustrated as sanctions are circumvented. The scrutiny Chinese firms face over ties to Russia’s military risks backlash from a Beijing already annoyed at what it sees as Western bullying.
Weeks before Xi Jinping met various leaders in San Francisco, the US released an estimate of China’s nuclear stockpile. Now, the EU and UK seem to be holding out an olive branch to China, especially with the surprise appointment of David Cameron as foreign secretary.
Despite unprecedented sanctions to isolate Russia, there are those in the Global South still keen to deepen relations with Moscow – including Thailand, Vietnam and Laos.
Thailand is quickly becoming Southeast Asia’s EV manufacturing hub as Chinese carmakers escaping geopolitical tensions set up shop in a state which has good relations with all the great powers.
Southeast Asia has become key to Beijing’s growing regional economic ambitions and security concerns.
Even as the RCEP was being negotiated, China was drafting its export control law. This indicates that while Beijing is emphasising economic integration within Asia, its position is more defensive towards countries further afield.
The Johnson government’s sudden about-turn in favour of a confrontational approach towards China may not be entirely accounted for by the desire to break free of the EU or bowing to Washington’s influence.
The G7 summit proved again that the glory days of the elite club are over. The future belongs to China and emerging economies. But while a knockout punch to globalisation is unlikely from either the US or British leader, surviving the trade war will be key.
Having recently consolidated their power domestically, both leaders should have a freer hand to work together to advance common goals, among them a resolution of the North Korea nuclear stand-off.
