Can the rest of Europe continue to compartmentalize?

The rest of Europe is similarly grappling with the question of whether it should hitch its economic future to a country that doesn’t share its values. On the one hand, China is the center of gravity of the world economy; opportunity and growth come from there, including possible solutions to shared challenges like climate change. On the other, the differences of values being discussed are significant; they include whether forced labor and the trampling of civil rights can ever be tolerated in the name of stability and security.

That tension became all the more untenable last week, when the US accused China of committing genocide against Uyghur Muslims in Xinjiang. (It’s a charge the Chinese Communist Party vigorously denies.)

EU leaders made their choice a few weeks ago when they announced the terms of a Comprehensive Agreement on Investment (CAI) with China: They believe investment can bring China more in line with their values. (It’s the same belief that motivated the US’ outreach to China in the 1970s and later early 2000s, when China joined the World Trade Organization. And yet that school of thought hasn’t born fruit, as China has grown into a capitalist juggernaut, but not a democracy.)

But read between the lines of the EU’s announcement and the message is clear: Even if that change doesn’t happen, Brussels doesn’t plan on turning its back on its second-biggest trading partner. In a blog post, Europe’s chief diplomat, Josep Borrell, wrote that “unlike in Washington, in the European Union there is not apparent tendency towards a strategic rivalry that could lead to a kind of new ‘Cold War,’ nor towards a broad economic decoupling.”

It may have to, though, if its parliament has anything to say about it. Just last week, members passed a resolution on Hong Kong in which they inserted language about the CAI, implying they could oppose its ratification:

European Parliament resolution on the joint investment agreement
Image: European Parliament

China’s reaction was swift and predictable: It accused the European Parliament of interference and defended its actions in Hong Kong.

Some critics of the CAI say that, in substance, it gives European companies in China few new benefits, while others expect it will create a raft of new opportunities for them. But no one disagrees that, symbolically, it’s a win for China. In the eyes of the world, it weakens the US’ genocide designation (which happened after the CAI was agreed to). After all, if a genocide were happening somewhere, surely the EU wouldn’t enter into a business arrangement with that country? And it seems to put the EU in Beijing’s corner just as US president Joe Biden enters office, seeking to create a joint strategy on China with fellow democratic nations.

But the CAI needs parliamentary ratification to become law—and in the next few months, as the text is translated and submitted for a vote, there’s a chance it won’t get it. In a previous interview with Quartz, Reinhard Bütikofer, a German member of European parliament who chairs the delegation for relations with China, said the debate “will boil down to just one question,” which is, can the EU deepen trade relations one day, while challenging China’s human rights violations the next?

Bütikofer knows which answer he favors: “Compartmentalization is not the right approach and we should leave it behind.”

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