Chinese President Xi Jinping's visits to France, Hungary and Serbia this week will seek to signal China's growing influence in Europe. showcasing Beijing’s economic and geopolitical ambitions through extensive public diplomacy efforts. This visit is considered a watershed moment for China-EU relations, following German Chancellor Olaf Scholz's visit to China last month. Xi's selected destinations in Europe have strong narrative significance.
Given China's dominant position on the transatlantic agenda, Xi's tour of Europe after five years may seek to identify ways to weaken coordination between Europe and the United States, in the hope that the European Union can act as a counterweight to perceived American hostility towards China. In this regard, Beijing is refining its diplomatic relations with the EU and its member states using trade and market opening as its main levers.
China-France relations: Macron’s agenda
Upon his arrival in France on May 6, Xi praised Sino-French relations as a model for the international community of peaceful coexistence and win-win cooperation between countries with different social systems, building on last year's declaration of a Sino-French agreement. global strategic partnership. Beijing has encouraged the idea of European strategic autonomy with the aim of sowing division within the transatlantic community.
Xi's host, French President Emmanuel Macron, reiterated in his recent speech speech to Sorbonne that the survival of the EU depends on achieving strategic autonomy and strengthening military resilience redefine Europe as a power, and choosing to eliminate “strategic dependencies” in critical sectors, ranging from semiconductors to essential raw materials.
For Macron, the two issues on the agenda during Xi's visit were trade disagreements and diplomatic initiatives regarding Ukraine. The issue of fair competition was crucial in Macron's recent speech when he discussed the idea of launching reciprocity strategies in trade deals and the emphasis on Made in Europe as always better for the planet. However, when it comes to trade rules, he put China and the United States in the same basket, saying the two major international powers have decided to no longer respect trade rules.
He later continued: We want trade that benefits us, but with many others that are starting to change the rules of the game, that are overly subsidizing, from China to the United States.
On trade issues, the main challenges are addressing overcapacity for rebalance European trade with China, control subsidies (particularly given France's central role within European commissions) Chinese electric vehicle surveys), ensure more equal market access for French companies and build resilient supply chains. More specifically Frances said Cognac diplomacy revolves around a Chinese anti-dumping investigation into European brandy, mainly French Cognac.
This bilateral visit also has a visible European dimension, taking into account Macron's prior consultations with Scholz and the participation of the President of the European Commission, Ursula von der Leyen, in the trilateral meeting. However, expectations for concessions from Xi should not be high. In the case of Germanyhe lifted restrictions on imports of beef and apples, but he refused to budge on the issue of overcapacity, justifying that Chinese exports of green technologies have enriched global supply and eased inflationary pressures, but also greatly contributed to the response to climate change.
Trade relations between China and the EU have intensified 900 percent since 2001 when China was invited to join the World Trade Organization, reaching $927 billion in 2022. At the same time, the EU's trade deficit with China increased by 930%, from $46 billion in 2001 to $429 billion in 2022. Chinese foreign direct investment in the EU is mainly concentrated in three countries: France, Germany and Hungary. More precisely, Chinese exports to France increased from less than $4 billion in 2001 to $42 billion in 2022, while French exports to China reached $25 billion.
The second most important issue on the agenda was getting Xi's support for a peace solution in Ukraine, which Macron wants to do. to focus on partner with China on global issues. The Sino-Russian The friendship pact has galvanized concerns in Europe about China's strategic ambitions, its his refusal to condemn the Russian war in Ukraine and his favorable economic stance towards Russia.
Von der Leyen took a tough stance during the Beijing summit in December 2023, calling on the Chinese response to the Russian war of aggression against Ukraine the defining issue for the EU in its bilateral relations with China and the threat that the EU could impose sanctions on Chinese entities seen as sending dual-use items to Russia. The next China vote in favor of a UN resolution which explicitly recognizes the aggression of the Russian Federation against Ukraine, although it was a broader resolution calling for closer cooperation between the UN and the Council of Europe, was a change diplomatic. Although symbolic, this highlights Beijing's policy adjustments aimed at maintaining favorable relations with European institutions.
Hungary and Serbia: Beijing's strategic partners in Eastern Europe
Hungary and Serbia are strategic partners of China and forerunners in terms of economic, social and diplomatic relations, within the framework of the former 16+1 initiative. Hungary sealed a global strategic partnership with China in 2017 and was the first European country to join the Belt and Road Initiative. Trade between China and Hungary has almost doubled since 2012, from $7 billion to $13 billion in 2022, but Hungary's trade deficit with China is much higher, from $3.6 billion to $8.5 billion in 2022.
In terms of cumulative investment, Hungary hosts by far the largest amount of Chinese FDI in Central and Eastern Europe. According to official Hungarian sources, in 2023, Hungary managed to attract a total of $14 billion in foreign direct investments, of which approximately 9 billion dollars comes from Chinese investments, including investments in battery factories and electric vehicles. Xi's visit to Hungary will be celebrated to highlight Chinese success in Central Europe, given that the country is also home to the largest concentration of ethnic Chinese in Central Europe.
A potential concern is the bilateralization of relations with different EU members, affecting the internal cohesion of the union and interfering in the EU's decision-making processes regarding Chinese issues. We have seen it in the past, like Hungary blocked an EU statement after an international tribunal ruling on the South China Sea, China criticizes Hong KongAnd criticism of the BIS.
Xi's visit to Serbia, the second in eight years, carries a strong political message as it coincides with the 25th anniversary of NATO's erroneous bombing of the Chinese embassy in Belgrade during the intervention of the NATO in former Yugoslavia. This opportunity will certainly be used to denounce the West, and particularly NATO, as a problem for other countries, and highlight the need to reshape the global governance system.
For Serbian President Alexander Vucic, the visit itself will be an important outcome given Western criticism of relations with Kosovo. This will be an opportunity to reiterate Beijing's support for Serbia's territorial integrity and its clear political alignment with the Serbian government in contesting the territorial integrity of Kosovo.
China is attracted to the Western Balkans for its geostrategic location and proximity to EU markets, viewing Serbia as a strategic European transport hub. With 61 Chinese projects valued at more than $21 billion in the Balkans, the most important is the modernization of the Belgrade-Budapest high-speed line. Trade between China and Serbia increased from less than $450 million in 2012 to more than $4 billion in 2023. Serbian exports to China increased from less than $4 billion in 2023. $400 million in 2020 to $1.3 billion in 2023.
Relations between Belgrade and Beijing go beyond economic ties, as Serbia signed an agreement A $3 billion economic support and military procurement program this strengthened Chinese influence in the country. THE Smart surveillance installation led by Huawei Belgrade's cameras have raised concerns about compatibility with EU standards on privacy and data protection, as Serbia has been negotiating to join the bloc for 10 years. The privileged bond between the two countries has been further strengthened during the COVID-19 crisis, where the Chinese vaccine gave a major boost to the Serbian government as it struggled to deal with the pandemic. Today, 85 percent of the population in Serbia have a favorable opinion of China.
While we observe a trend towards transatlantic convergence on China in recent months, Europe is not really united on future strategies towards China. European approaches depend on each country's economic relations with China, the extent of its technological dependence, and the leadership and public attitude toward China.
Since March 2019, the mantra of EU relations with Chinaunder the leadership of the European Commission, endeavored to find a balance between negotiating partnership, economic competition for technological leadership and systemic rivalry of governance models. Xi Jinping's visit this week will show which of these pillars of European strategy will take priority.