Darstellung von China, Europa und den USA als Personen

Cold War 2.0? Essential Readings on the New Systemic Conflict 05/21

Welcome to the May issue of our literature review on the systemic conflict with China. The EU is developing a new Indo-Pacific strategy and taking a tougher stance on China. The European Commission recently warned of China's "authoritarian shift" and "fundamental divergences" between the EU and China in the areas of business, human rights and global governance. The G7 foreign ministers agreed on a common stance toward an increasingly assertive China. Yet Berlin and Paris continue to give Washington the cold shoulder when it comes to the U.S. administration's efforts to build a unified front against China. This passivity has major implications for transatlantic cooperation not only on China, but also on other issues.

While some of its most important allies still hesitate, Washington continues to implement its strategy of "extreme competition" with China. In his first joint address to Congress on April 28, U.S. President Biden spoke out against the forces that threaten democratic values and casted U.S.-China relations as a battle between democracy and autocracy. China, for its part, continues to adhere to its ambitions to reshape the international order according to its own ideas but is experiencing that its "soft power" is being perceived with increasing skepticism, especially in Europe. In addition, China had to learn that it cannot count on automatically converting its growing economic clout into a new geopolitical reality. Notwithstanding this, economic and technological competition continues to accelerate. In its 14th Five-Year Plan, Beijing has mapped out an economic strategy signaling greater protectionism to products not made in China. For its part, the European Commission released new policy proposals addressing economic and strategic challenges posed by China.

As usual, I have tried to map the ongoing debate and point out contributions I consider essential readings. Please feel invited to comment on my selection. I look forward to your feedback. Wishing you an interesting read.

In this Issue

1. EU-China Relations: Europe's Hardening Stance on China and Its New Indo-Pacific Strategy

2. Transatlantic Cooperation on China: Berlin and Paris Are Giving Washington the Cold Shoulder  

3. U.S.-China Relations: A battle between Democracy and Autocracy?

4. China’s Power and Ambitions: Dwindling Soft Power and Self-Defeating Economic Statecraft

5. Economic and Technological Competition: China’s Economic Strategy and European Countermeasures


1. EU-China Relations: Europe's Hardening Stance on China and Its New Indo-Pacific Strategy

“EU Strategy for Cooperation in the Indo-Pacific”

Council of the European Union, April 19, 2021

In short: EU adopts a new strategy for the Indo-Pacific region.

On April 19, the Council of the EU released its 10-page conclusion on the “EU Strategy for cooperation in the Indo-Pacific.” The Council approved conclusions on an EU strategy for cooperation in the Indo-Pacific, setting out the EU’s intention to reinforce its strategic focus, presence and actions in this region of prime strategic importance for EU interests. The aim is to contribute to regional stability, security, prosperity and sustainable development, at a time of rising challenges and tensions in the region. The renewed EU commitment to the Indo-Pacific, a region spanning from the east coast of Africa to the Pacific island states, will have a long-term focus and will be based on upholding democracy, human rights, the rule of law and respect for international law. The Council tasked the High Representative and the Commission with putting forward a Joint Communication on cooperation in the Indo-Pacific by September 2021. Although the new EU strategy is not explicitly aimed at China, its objective obviously is to support a rules-based multilateralism that Beijing is seeking to reshape.

See also the official press release by the Council of the EU: Indo-Pacific: Council adopts conclusions on EU strategy for cooperation.


“The EU’s Indo-Pacific Strategy in 10 Points”

Eva Pejsova, The Diplomat, April 20, 2021

In short: The main takeaways from the European Union’s long-awaited strategy document on the Indo-Pacific region.   

This article by Eva Pejsova, senior Japan fellow at the Centre for Security, Diplomacy and Strategy (CSDS) of the Vrije Universiteit Brussels, is a very good reading aid for the EU document cited above, summarizing the “EU Strategy for cooperation in the Indo-Pacific” in ten main takeaways. It concludes that the new Indo-Pacific strategy is “a milestone for the EU’s foreign policy. “The Council Conclusions represent a consensus reached by the 27 EU member states and should be read as such. More than a decade since the first formulation of the Indo-Pacific concept by Japan, the publication of the strategy is a result of a long internal debate, reflecting the differences of strategic priorities of its members, Brussels’ evolving perception of regional security challenges and – to an extent – the nature of the EU as a foreign policy actor.”


“The EU’s Indo-Pacific strategy: A chance for a clear message to China and Europe’s allies”

Frédéric Grare, ECFR, April 22, 2021

In short: The EU must breathe life into its Indo-Pacific strategy and back up its words with action.   

A strategy is much more than a simple collection of objectives, no matter how legitimate and well meaning. It is first and foremost a political message, which should be understood by friends and foes alike, and in which the resolve matters as much as the content, agues Frédéric Grare, Senior Policy Fellow at the European Council on Foreign Relations, in this commentary. From that perspective, he asks: What message will the EU’s Indo-Pacific strategy convey to China given that does not even describe China as a “competitor, systemic rival and partner” in the way that the EU China strategy does? Similarly, what is the message sent to the EU’s current and potential partners? His answer: “Because no EU member state, with the notable exception of France, is a resident power in the Indo-Pacific, the EU will have to make a particular effort to demonstrate that it means business. It needs to show it is ready to contribute to the overall objectives of the Indo-Pacific concept in more than words. The EU cannot expect to dilute China’s impact in the region merely through its presence. It needs to provide economic, political, and strategic alternatives to the series of individual face-offs between China and each of its interlocutors, in which the huge power asymmetry in favor of China allows Beijing to dictate the terms of the relationship.”


EU slams China’s ‘authoritarian shift’ and broken economic promises

Stuart Lau, POLITICO, April 25, 2021

In short: The EU's stance on China is hardening, and that should go down well in Washington.   

Only four months after Beijing and Brussels concluded the principles of the Comprehensive Agreement on Investment (CAI), a high-level internal report shows the EU is now increasingly pessimistic about keeping business interests separate from political concerns over what it calls President Xi Jinping's "authoritarian shift", Stuart Lau reports for POLITICO. This tougher language reflects a new approach in the EU's official communications on China. The report seeks to assess the changing dynamics since the EU-China strategic outlook was published in 2019. The EU's acknowledgement that the environment is now "more challenging" reflects an unexpectedly rapid souring of diplomatic relations since December. Since then, there has been heightened international concern about China's military brinkmanship over Taiwan, its crackdown against Muslim Uyghurs in the region of Xinjiang, and against democracy activists in Hong Kong. “The reality is that the EU and China have fundamental divergences, be it about their economic systems and managing globalization, democracy and human rights, or on how to deal with third countries. These differences are set to remain for the foreseeable future and must not be brushed under the carpet," European Commission President Ursula von der Leyen Josep Borrell, the bloc's foreign policy chief, said in a letter outlining the report to the European Council comprising leaders of the 27 EU countries, on April 21.


2. Transatlantic Cooperation on China: Berlin and Paris Are Giving Washington the Cold Shoulder

“Watching China in Europe – May 2021”

Noah Barkin, GMF, May 4, 2021

In short: Regarding China, Berlin and Paris are giving Washington the cold shoulder.   

“If the United States is back, as Biden likes to proclaim, Berlin and Paris do not seem ready to acknowledge it. And this has major implications for the new administration’s core foreign policy goal − building a united front with allies to push back against China”, writes Noah Barkin, Senior Visiting Fellow at the GMF’s Asia Program, in his monthly blogpost. According to Barkin, Angela Merkel and Emmanuel Macron are currently collectively giving the Biden administration the cold shoulder, especially, but not only, with regard to Washington's efforts to develop a common transatlantic China policy. That view was reinforced by the latest edition of Sino-German government consultations, which took place on a virtual basis on April 28. There was no mention of  Beijing’s sanctions against German and European lawmakers, academics and think tanks, but there was strong support for the CAI from Merkel, who referred to it as a “cornerstone” of fair, transparent, and reciprocal economic relations between Europe and China.


“Transatlantic Relations After Biden’s First 100 Days”

Erik Brattberg, Carnegie Endowment for International Peace, May 6, 2021

In short: Many European countries remain reluctant about fully embracing the U.S. strategy against China.

The new U.S. administration has brought a welcome change in tone to transatlantic relations. But little progress has yet been made on thorny issues, including trade, technology, climate, and China, concludes Erik Brattberg, director of the Europe Program at the Carnegie Endowment for International Peace, in this article. While the diplomatic groundwork has been laid, the proof is still in the pudding as to whether a more ambitious transatlantic agenda is possible. Joe Biden’s vision is to gather U.S. allies and partners to shape the international system to compete with authoritarian powers “from a position of strength.” He is more prone than the EU to see the multilateral system as a playing ground for strategic competition against China. While the EU is open for deeper cooperation with the U.S. and other likeminded partners, especially on issues related to the democracy-technology nexus, most European capitals still favor multilateral engagement with Beijing and are watchful of becoming mere instruments in the U.S. competition with China. They will therefore be reluctant about fully embracing Biden’s so-called free world agenda. U.S. officials complain in private that some European capitals are not reciprocating the bonhomie coming from Washington, and they point especially to Berlin’s and Paris’s timid responses to Biden’s call for joining hands against China.


”G7 Foreign and Development Ministers’ Meeting: Communiqué, London, 5 May 2021”

United Kingdom Foreign, Commonwealth & Development Office, May 5, 2021

In short: G7 foreign ministers seek common stand towards an increasingly assertive China.   

At the G7 foreign ministers meeting in London on May 5, participants agreed on their intention to work more closely together to curb China's growing influence in the world. They raised concerns over Xinjiang, Hong Kong and Tibet, and called for Taiwan to play a meaningful role in the World Health Organization. The foreign ministers of the Western economic powers stated in their final declaration: “We encourage China, as a major power and economy with advanced technological capability, to participate constructively in the rules-based international system […] In line with its obligations under international and national law, we call on China to respect human rights and fundamental freedoms.” Moreover, the G7 communique declared: “We are united in our concern regarding practices that undermine such free and fair economic systems, including on trade, investment and development finance. We will work collectively to foster global economic resilience in the face of arbitrary, coercive economic policies and practices. We urge China to assume and fulfil obligations and responsibilities commensurate with its global economic role.”


3. U.S.-China Relations: A Battle between Democracy and Autocracy?

“Remarks by President Biden in Address to a Joint Session of Congress”

The White House, April 29, 2021

In short: Joe Biden casts U.S.-China relations as a battle between democracy and autocracy.

In his first joint address to Congress on April 28, U.S. President Joe Biden spoke out against the forces that threaten democratic values. In the process, he repeatedly mentioned China's quest for global dominance and the extreme competition between Washington and Beijing. “We’re in competition with China and other countries to win the 21st Century. We’re at a great inflection point in history.” Describing his many conversations with Chinese President Xi Jinping, Biden said: “He’s deadly earnest about becoming the most significant, consequential nation in the world. He and others − autocrats − think that democracy can’t compete in the 21st century with autocracies because it takes too long to get consensus […] I told him, ‘We welcome the competition. We’re not looking for conflict.’ But I made absolutely clear that we will defend America’s interests across the board. America will stand up to unfair trade practices that undercut American workers and American industries, like subsidies from state − to state-owned operations and enterprises and the theft of American technology and intellectual property.”

To watch the entire joint address to Congress, click here.


“Biden’s China Challenge”

Susan A. Thornton, Internal Politik Quarterly, Issue #2/2021 - April

In short: Will U.S. policy toward China lead to a balanced, pragmatic relationship or drive zero-sum contestation? 

U.S. President Biden faces a number of interconnected challenges when it comes to developing American policy toward China. Beyond the handling of individual issues, the big question is whether the “extreme competition” that Biden and the U.S. have unilaterally declared, will allow for a balanced and pragmatic relationship or drive toward zero-sum contestation, writes Susan A. Thornton in this article. While China’s continued rapid rise is not assured and it faces myriad challenges, it is nevertheless likely that its growth will continue to outstrip the West’s. The last four years have left a zero-sum imprint on the minds of many Americans that will be difficult to ameliorate. China’s aggressive behavior in regional and territorial disputes, increased internal repression, and questionable trade and technology practices provide plenty of ammunition for this view. For now, it appears that the Biden team will try to organize its China policy by working around China, as it looks to assemble allies for a joint approach. It is likely to find, however, that other players are less ardent and more pragmatic when it comes to China’s rise. They certainly see the urgency in shoring up and reforming the international system, but they also want to work with China to do so. Provided those partners are forthright with the U.S. about how they see it, joint progress will be possible, and could come quicker and easier than we think. Susan A. Thornton is senior fellow and research scholar at the Paul Tsai China Center at Yale University Law School and director of the Forum on Asia-Pacific Security at the National Committee on American Foreign Policy.


4. China’s Power and Ambitions: Dwindling Soft Power and Self-Defeating Economic Statecraft

“China’s Soft Power in Europe Falling on Hard Times”

Ties Dams, Xiaoxue Martin and Vera Kranenburg (ed.), Clingendael, April 20, 2021

In short: Chinese soft power in Europe has fallen on hard times.   

This report is a publication by the European Think-tank Network on China (ETNC), a gathering of China experts from various European research institutes. Based on separate analyses of 17 countries and EU institutions, it concludes that Chinese soft power in Europe – defined as the ability to influence preferences through attraction or persuasion – has fallen on hard times. Developing soft power has been a pillar of Chinese foreign policy and remains a stated goal of China’s long-term policy orientation. The report identifies three prominent Chinese approaches to developing soft power in Europe: promoting Chinese language and culture; shaping China’s image through the media; and using the secondary soft-power effects of economic prowess. These new methods, though deployed differently across the continent and aimed in part at a Chinese political audience, point to Beijing’s objective to increase its sway over Europe by influencing related discourse. They are presumably designed to prevent negative publicity and criticism, rather than achieve likeability.


“Xi Jinping Thought on the Rule of Law. New Substance in the Conflict of Systems with China”

Moritz Rudolf, Stiftung Wissenschaft und Politik, April 28, 2021

In short: Beijing will increasingly promote its own definition of the rule of law internationally, establishing new legal standards and enforcing its interests through the law.

The Chinese leadership had been promoting the term “socialist law with Chinese characteristics” for quite some time. That the Central Committee of the Communist Party of China (CPC) has now adopted its own five-year plan to establish the rule of law in China illustrates the new quality of these efforts and how strategically embedded they have now become, Moritz Rudolf, Associate in the Asia Research Division at SWP, points out in this paper. The Xi administration has understood that law is an important lever in achieving greater international influence. This plan represents the most concrete expression of Xi Jinping’s vision of how the law should be interpreted and applied in China and in the international context. Beijing will increasingly promote its own definition of the rule of law internationally. For the CPC leadership, it is a matter of questioning established definitions and then countering them with Chinese terms. The Chinese side argues that the existing international legal system reflects the balance of power from the period immediately after the Second World War. Beijing is calling for a general over­haul of the world order because the inter­national power structure has changed fundamentally.


“Northern expedition: China’s Arctic activities and ambitions”

Rush Doshi, Alexis Dale-Huang and Gaoqi Zhang, Brookings, April 2021

In short: China seeks to become a “polar great power” but downplays this goal publicly.

This Brookings report, written by Rush Doshi, Alexis Dale-Huang and Gaoqi Zhang, explores China’s internal discourse on the Arctic as well as its activities and ambitions across the region. It finds that China sometimes speaks with two voices on the Arctic: an external one aimed at foreign audiences and a more cynical internal one emphasizing competition and Beijing’s Arctic ambitions. In examining China’s political, military, scientific, and economic activity − as well as its coercion of Arctic states − the report also demonstrates the seriousness of China’s aspirations to become a “polar great power.” China describes the Arctic as one of the world’s “new strategic frontiers,” ripe for rivalry and extraction. It sees the Arctic − along with the Antarctic, the seabed, and space − as ungoverned or undergoverned spaces. While some of its external discourse emphasizes the need to constrain competition in these domains, several others take a more cynical view, emphasizing the need to prepare for competition within them and over their resources.


“China and Russia’s Dangerous Convergence. How to Counter an Emerging Partnership”

Andrea Kendall-Taylor and David Shullman, Foreign Affairs, May 3, 2021

In short: Any effort to address China’s or Russia’s behavior must account for the two countries’ deepening partnership.

The Biden administration has signaled that China is its number one foreign policy priority. The president has called Beijing Washington’s “most serious competitor” and emphasized that China’s economic abuses, human rights violations, and military capabilities pose a threat to U.S. interests and values. But Washington shouldn’t underestimate Moscow, argue Andrea Kendall-Taylor and David Shullman in this article. Russian President Vladimir Putin oversees over a highly capable military and has shown that he is willing to use it. Fearful of irrelevance, Putin is looking for ways to force the U.S. to deal with Moscow and likely views a relationship with Beijing as a means to strengthen his hand. For the United States, confronting these decidedly different adversaries will be a tall order, and the two countries will inevitably divide Washington’s attention, capabilities, and resources. The problems the two countries pose to Washington are distinct, but the convergence of their interests and the complementarity of their capabilities − military and otherwise − make their combined challenge to U.S. power greater than the sum of its parts. China, in particular, is using its relationship with Russia to fill gaps in its military capabilities, accelerate its technological innovation, and complement its efforts to undermine U.S. global leadership. Any effort to address either Russia’s or China’s destabilizing behavior must now account for the two countries’ deepening partnership. Andrea Kendall-Taylor is Director of and David Shullman is an Adjunct Senior Fellow in the Transatlantic Security Program at the Center for a New American Security (CNAS).


“How Not to Win Allies and Influence Geopolitics. China’s Self-Defeating Economic Statecraft”

Audrye Wong, Foreign Affairs, May/June 2021

In short: China cannot count on automatically converting its growing economic clout into a new geopolitical reality.   

Over the past few decades, China’s global economic footprint has grown enormously. China has managed to massively expand its economic presence beyond its borders, but so far, it has failed to turn it into long-term strategic influence. The Chinese economy exerts a strong gravitational pull, but as Beijing is discovering, that does not necessarily mean that other countries are altering their political orbits, argues Audrye Wong, Postdoctoral Fellow at the Harvard Kennedy School and the Massachusetts Institute of Technology’s Security Studies Program, in this article. For a variety of reasons, China cannot count on converting its growing economic clout into a new geopolitical reality. “In the end, China’s rapidly expanding overseas economic presence, particularly when accompanied by subversion and coercion, may exacerbate strategic fears across the globe. Chinese officials may still think that economic development naturally promotes goodwill and gratitude among recipients, but there is good reason to believe that they are wrong.”


5. Economic and Technological Competition: China’s Economic Strategy and European Countermeasures

“China’s grand industrial strategy and what it means for Europe”

Frederico Mollet, European Policy Center, April 21, 2021

In short: With its new economic strategy China is taking a protectionist turn.   

In its 14th Five-Year Plan, China has mapped out a grand economic and industrial strategy that upends many of the assumptions that underpin the EU's approach - how can the Union respond? According to Frederico Mollet. Policy Analyst at the European Policy Centre, with this new plan, the EU can expect tougher competition and greater protectionism in its economic relations with China. A further blurring of the public-private sector distinction in the country's economic model will make it harder to combat unfair Chinese competition. And while China is actively courting foreign investment, it is also signaling greater protectionism to products not made in China, which will lead to European investors' and exporters' interests diverging. “China's protectionist turn and growing one-sided dependencies will threaten Europe's long-term strategic autonomy and undercut any attempts to construct a balanced approach to EU–China relations. If the EU's multi-track strategy is to work, a concerted effort is required to preserve economic parity and balance between the two powers.”


“Europe’s Capacity to Act in the Global Tech Race. Charting a Path for Europe in Times of Major Technological Disruption”

Kaan Sahin and Tyson Barker, DGAP, April 22, 2021

In short: Europe has quite a way to go if it wants to become competitive with the U.S. and China in the global tech race.

Technological leadership has become a central dimension of geopolitical power. In this development, the primary front in the emerging tech power rivalry is between the U.S. and China. EU has fallen behind and needs to catch-up. The stakes in this race are high and will have an impact on economic competition, national security and broader values-based notions of political order, argue Kaan Sahin and Tyson Barker in this DGAP report. The study sheds light on Europe’s approach to technological mastery. It looks into the progress of the EU and its member states across selected technological fields and their global entanglements with other nations and technology actors. According to the authors there are five key technology areas that are set to define and shape the future of Europe’s capacity to act. These are: artificial intelligence (AI), cloud computing, semiconductors, 5G and mobile equipment, and quantum technology. The report assesses Europe’s strengths and deficits in each of these areas.


“Brussels presents plans to revive EU industry. Analysis of ‘strategic dependencies’ singles out 137 products, more than half of them coming from China”

Paola Tamma, POLITICO, May 5, 2021

In short: European Commission proposes new defensive economic measures on China.     

The European Commission laid out its industrial strategy update on May 5, putting the accent on securing autonomy in key supply chains, Paola Tamma reports. The Commission carried out an analysis of Europe's "strategic dependencies", singling out 137 products for which Europe is highly dependent on imports. Over half of these strategically sensitive products come from China. The Commission highlighted six sectors: batteries, cloud and edge technologies, hydrogen, pharmaceutical ingredients, raw materials and semiconductors. To reduce dependency, the Commission proposes diversifying supply chains, stockpiling and pooling resources into the provision ‘important projects of common European interest’ (IPCEI). It also voiced its ambition to lead the emerging tech standard-setting processes.

You can read the original communication from the European Commission here.

About the Literature Review

Democratic states are increasingly challenged by assertive authoritarian powers. China, in particular, has become an economically successful, technologically advanced autocracy and an ambitious global geopolitical actor who promotes its model as an alternative to liberal democracies and their values. At the Bertelsmann Stiftung, we think (and worry) a lot about this new systemic conflict and its consequences for Germany and Europe and so do many of our peers in politics, think-tanks, academia or media. In this monthly compilation, Peter Walkenhorst maps the ongoing debate and points to important contributions he considers essential readings. Previous issues of this Literature Review can be found here: