Li 's visit to EU reveals civilisational partners relationship
Earlier this year, for the first time ever, a Chinese Head of State visited the headquarters of the European Union in Brussels. President Xi Jinping made a speech at the end of March while there which described the relationship between the world's two largest trading partners as one of `civilisational partners.' This was a new formulation. From 2004, under Wen Jiabao, it has been described as a `strategic partnership.' But with the failure of the EU to life the arms embargo towards China imposed since 1989 because of US pressure, and to grant China market status, the relationship entered a cooler period. From 2009, it has improved, with China participating as an investor and trade partner in a European recovery because of the Great Financial Crisis from 2008.
The visit of Premier Li Keqiang is one of the first major visits to Europe since Mr Xi, and lets us understand a little more what this idea of `civilisational partners' might be. Unlike with Mr Li's earlier visit to the UK in June, the two countries in the EU which he visited this time were Germany and Italy. He also sent to Russia. This in itself is an interesting combination, and lets us understand why, in many ways, trying to frame a EU-wide coherent policy for China is often so challenging.
With Italy, the Premier was able to lead a large trade delegation, and make links with a relatively new government which has much more political purpose than its predecessors who were largely involved in economic crisis management. Even so, Italy is still in the recovery stage, with sluggish growth and a long standing unemployment problem, particularly amongst its youth. Links with China are important in this context because of inward investment and access to the Chinese market for Italian goods. Here there has been tension, with accusations by Italian textile manufacturers that their industry has been decimated by fierce Chinese competition. Three years ago I visited the northern city of Prato, a place which has become famous for the high number of Chinese merchants and workers who have moved there. Claims in the press that the city had simply banned more Chinese moving in were an exaggeration. But the feeling of being overwhelmed with little competitive advantage in the Chinese market is one that Li had to address.
His visit to Germany was politically the more important, and the fact that he was able to forge such a strong relation with the Chancellor Angela Merkel is good news for Germany and Europe. We often underestimate the importance of personal chemistry and friendship between top level leaders and the ways it can assist in good diplomacy. But history shows that when leaders of different countries have good communication and feelings between each other, it can help immensely when problems arise. At least they can speak to each other directly and try to sort things out.
Li undertook a remarkable piece of public relations in Germany, accompanying Merkel to a supermarket to shop. Europeans are used to seeing Chinese leaders as remote and inaccessible. This, added to the cultural difference, often creates misperceptions. The German press in particular has also been highly critical in the past when Chinese leaders have visited, unleashing strong words during Premier Wen Jiabao's visit three years ago despite the fact that diplomats on both sides claimed the visit a success. This attempt to reach out to the German people seems to have worked, with the German newspapers giving largely positive coverage. The fact that Merkel herself has only ever done this sort of public activity with one other leader is also significant.
The simple fact is that the German economy may well have been the engine of Europe and the EU in the last decade, with particular strong performance over the last five years when the Eurozone crisis threatened to bring the whole regional economy to ruin, but in the last few months growth has been slowing. In addition, of the EU 28 members, Germany is the only one that runs a trade surplus with China. Maintaining strong exports with the People's Republic therefore is critical. The slowing of Chinese growth is evidently having a knock on effect, just as it is in Australia, another developed country with a surplus with China.
Li's main trade event in Germany was to visit Hamburg to address the forum there. Hamburg is a unique place for Chinese enterprises in Europe. Even in the mid 2000s, it had over 200 Chinese enterprises based there, many of them small, linked to the logistics networks for Chinese exported goods. Hamburg as a place for Chinese businesses to come and work as they increase their commitment to Europe therefore is a well established story. Today, there are 500 Chinese enterprises in the city. In many ways, therefore, Li was coming to the central place in Europe for Chinese business and investment access.
Despite this area of common interest, however, things were not plain sailing. Some critics complained that for all the warm words, in many areas Germany and China had some big differences. On the unrest in Hong Kong, for instance, and on Russia there was evidently different interpretations. Merkel has been one of the strongest supporters of sanctions against Russia, taking an increasingly tough stance since the annexation of Crimea earlier this year and the continuing unrest in Ukraine. This made Mr Li's next stop in his tour, a visit to Moscow, his first as Premier, even more significant.
Whatever he said to Ms Merkel, that did not stop his arrival in the Russian capital being accorded a high level celebration by the Mr Putin's administration. Russia is now relatively isolated, with many of its bordering regions highly ambiguous about its recent strong arm tactics. Poland, Lithuania, Latvia, and Estonia have all complained about reports of invasive Russian air force movements in their air space, even though a recent election in Latvia also returned a pro-Russian party to government. For some of Europe, and some members of the EU, therefore, the issue of Russia is a complex one.
China's position so far has been to use this opportunity to grow closer to China, signing a major framework deal earlier this year for gas exploitation and supply from Siberia. Even so, the relationship between the two countries is never a straightforward one. So for all the warm words in Moscow, and signing of a new major trade deal, old misapprehensions and distrusts die hard. Mr Putin's vision of a strong great power status for Russia provides stability to a country that has been highly unstable for the last two decades. But it also raises all sorts of questions about its attitude towards neighbouring countries, with Ukraine only being the first of possibly many that feel Russia's new pushiness. This is unwelcome to China.
The fact that Chinese leaders are spending so much time diversifying positive diplomatic links however, is good news. Italy, Germany and Russia are in very different economic and diplomatic situations at the moment, but despite this the message that Premier Li was able to craft when he spoke in each one was the same: that for all the challenges of China's continuing transition and reform, its potential for economic growth and dynamism is still strong, and these countries need to engage with this if they want to address their own challenges. That is the common framework that Li is presenting. That he was able to avoid being sucked into a battle of allegiances between the EU and Russia despite the current troubles was an achievement in itself. The interesting fact too is that for all of these countries, and most others, the main issue is to get the best relationship that they can with China at the moment. IN perhaps that area alone, despite all their differences, they are guided by the same motive.
Professor Kerry Brown
Kerry Brown is Professor of Chinese Politics and Director of the China Studies Centre, University of Sydney and Team Leader of the Europe China Research and Advice Network (ECRAN) funded by the European Union. He is an Associate Fellow of Chatham House, London and author of `Struggling Giant: China in the 21st Century' (2007), `The Rise of the Dragon: Chinese Inward and Outward Investment in the Reform Era' (2008), `Friends and Enemies: The Past, Present and Future of the Communist Party of China' (2009), `Ballot Box China' (2011), `China 2020' (2011), `Hu Jintao: China's Silent Leader'(forthcoming).