Addressing Rivalry and Making Friends: Xi’s Europe Visit

 By Ashu Maan
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China’s President, Xi Jinping, visited Europe between 5-11 May 2024 on state visits to France, Serbia, and Hungary. Xi’s first European tour in half a decade arrived at a significant juncture for China’s ties with these three countries. Notably, 2024 commemorates the 60th anniversary of diplomatic relations between China and France and the 75th anniversary with Hungary. Additionally, the visit coincided with the 25th anniversary of the NATO airstrikes on the Chinese embassy in Belgrade during the Kosovo conflict. This article focuses on key takeaways from Xi’s visit, including trade with the EU, Emmanuel Macron’s political agenda, and Serbia and Hungary’s budding partnership with China.

France and China

Xi’s visit to France included a bilateral meeting with the French President that focused on various issues from trade and R&D to the war in Ukraine and Gaza. The two sides reached an understanding in the following four fields.

The first understanding reached was on France-China strategic communication. Both sides agreed to do policy consultations and carry out regular state visits. This is in tandem with Macron’s agenda of making France an independent global player.

Second, understanding pertained to trade, covering agri-food, finance, and aviation. China and France trade in 2023 stood at $78.9 billion in 2023. China’s exports to France amounted to $41 billion in 2023, with top exports of electrical equipment, machinery, nuclear reactors, furniture, and vehicles other than railways and trams. In the same period, France’s exports to China amounted to $37.33 billion, with top exports of beauty products, medicaments, wheat, trunk and cases, and gas turbines. France currently runs a trade deficit of $4 billion with China. France raised the issue of “China’s overcapacity” to address the trade deficit. However, Xi denied it. One positive for France was Xi’s agreement to buy more agricultural products under “French Farms to Chinese Dinning Tables” mechanism. It will bolster France’s agriculture sector, which amounts to 18% of production value in the European Union. The mechanism will also be beneficial to China as it will address China’s food security needs.

The third understanding was related to people-to-people ties. China has decided to extend the visa-free policy for French citizens until 2025. China has also offered to open direct flights from Shanghai to Marseilles. China aims to increase the number of French students in China to 10,000 by 2027. This aligns with China’s attempt to build a positive image through cultural exchanges. Through student exchanges, China wants to instil a narrative of benevolence through education.

The fourth understanding was about building consensus on global problems. It included discussions on biodiversity, climate change and AI.

Testing Transatlantic Unity and Establishing In-Betweens

          Two statements by Xi during his visit reveal his real priorities. First, he said, “Six decades ago, General Charles de Gaulle, with a strategic vision based on the trend of the time, resolved to establish diplomatic relations with New China. It wasn’t easy to make this independent decision at the height of the Cold War, but it has proven to be right and foresighted. With the establishment of China-France relations, a bridge of communication between the East and West was built, and the international relations were able to evolve in the direction of dialogue and cooperation”. The second statement was given during the France-EU-China trilateral meeting where Xi said that “China-EU relations enjoy strong endogenous driving force and bright prospects of development. This relationship does not target any third party, nor should it be dependent on or dictated by any third party. It is hoped that the EU institutions will develop the right perception of China and adopt a positive China policy”.

          Xi’s first statement strategically positions France as an independent actor on the global stage, capable of making decisions that diverge from the interests and influence of the United States. By highlighting General Charles de Gaulle’s decision to establish diplomatic relations with China during the tumultuous era of the Cold War, Xi Jinping underscores France’s historical commitment to charting its own course in international affairs, free from external pressures. This is in line with Macron’s push for ‘Strategic Autonomy’. Additionally, it also buttresses Macron’s agenda for leading the European Union.

The US-China ties are at a historical low now, and the two have a huge trust deficit. Even the US Secretary of State Antony Blinken’s recent visit to China failed to address the trust deficit. In this context, Xi’s remarks can be interpreted as a subtle invitation to France to assume a more proactive role as a mediator or intermediary between the two powers. By highlighting the bridge of communication that China-France relations have established between the East and West, Xi Jinping suggests that France possesses the unique diplomatic pedigree and credibility to facilitate dialogue and foster cooperation in the face of mounting tensions. By positioning France as a potential go-between for the United States and China, Xi Jinping’s statement not only underscores the importance of France’s strategic autonomy but also its potential to shape the trajectory of global geopolitics.

Xi’s second statement strategically aims to reshape the European Union’s (EU) approach to China by urging the EU to distance itself from its historical alignment with the United States. By emphasising the need for China-EU relations to be independent and not dictated by external actors, particularly the US, Xi is attempting to sway the EU towards a more favourable stance on China. Despite the reality of close coordination between the EU and the US on China-related issues, such as sanctions against Chinese officials for human rights violations, Xi attempts to portray China-EU relations as separate and independent from US influence. This portrayal is designed to sow divisions within the transatlantic alliance and weaken collective efforts to address shared challenges posed by China’s rise.

Serbia and Hungary: Fishing for Friends

Hungary and Serbia are not on the best terms with the United States. The Hungarian Prime Minister, Viktor Orban, has repeatedly criticised the United States policies in Europe, particularly Ukraine. Additionally, Orban has opposed the EU’s China policy by favouring a more independent approach towards China.

Xi reached Hungary on 8 May, marking the conclusion of his Europe tour. His journey commenced in France, with a brief stopover in Serbia before reaching Budapest.

This visit marks Xi’s first trip to Eastern Europe since his 2016 visit to the Czech Republic. It underscores Xi’s commitment to fostering the 16+1 group, an initiative to strengthen ties between China and former communist European countries by investing in China’s Belt and Road Initiative (BRI). Notably, both Serbia and Hungary are active participants in the BRI.

Serbian President Aleksandar Vucic praised the strong bilateral relationship, referring to it as an “ironclad friendship.” According to the country’s Infrastructure and Energy Ministry, Chinese investment in Serbia, which has reached nearly $20 billion, underscores the depth of economic cooperation. Additionally, a new free trade agreement announced during Xi’s visit aims to eliminate tariffs on most of Serbia’s exports to China over the next five to 10 years.

Hungary also enjoys robust economic ties with China, receiving $11.5 billion in Chinese investment in 2023, particularly in the electric vehicle sector. Despite concerns from the European Union about Chinese dominance in critical industries, Hungary has embraced Chinese support, which is evident in recent announcements such as the construction of an electric vehicle assembly plant by Chinese carmaker BYD.

Both Serbia and Hungary, led by nationalist leaders, have refrained from addressing human rights issues in China or Beijing’s support for Russia. Their geopolitical alignment with China stems from shared anti-Western sentiments and concerns about maintaining economic stability. Moreover, both countries’ stances on international conflicts, such as Ukraine and Kosovo, align with Beijing’s. Similarly, Serbia’s position on territorial claims also aligns with China’s, as Serbia does not recognise Kosovo’s independence, and China does not recognise the sovereignty of Taiwan. Xi’s visit to Hungary signifies the deepening economic and political ties between China and Eastern European countries, characterised by mutual interests and strategic alignment on various global issues.

Conclusion

Amid Beijing’s deteriorating relations with the United States, Xi’s visit to Europe can be seen as making new allies and neutralising others. Xi through his statements in France was encouraging Macron to make the EU follow an autonomous policy (free from US influence) against China. Xi succeeded to an extent as France signed various agreements with China at a time when the US is imposing duties on Chinese goods. Xi was playing a shrewd game of maximizing divisions between the EU and US and seemed to have achieved a bit but the US due to its security commitments in Europe will still have considerable influence. Xi’s stopover in Serbia on the 25th anniversary of the Belgrade bombing was about making a narrative of excesses committed by the United States. In Hungary, Xi signed a strategic partnership, making use of the drift between Hungary and the United States. Xi was dealing with Europe during the visit, but his focus was very well on the United States.