Whilst the Chinese and American presidents attempt to control their rivalry, Europeans fear they will bear the brunt of this ‘armed peace’.
Ruled with an iron fist by a Communist Party to which all leaders – including the president – must pledge allegiance, China has determined to regain its position as the world’s leading power (by 2049). This is being achieved in an authoritarian yet effective manner.
To this end, it has developed a notably predatory strategy.
Chinese companies are heavily subsidised (at least five times more than in Europe) in various ways (through loans, tax breaks, etc.) and are not subject to the same profitability requirements.
The authorities use every means at their disposal to push them to capture Western market share, a priority objective the consequences of which spell real industrial disaster for us.
In addition to its apparent dynamism, it also imposes numerous barriers to trade from abroad.
German car manufacturers are a case in point. Whilst they long believed they were exploiting the Chinese market, their technologies and the compulsory shift to electric vehicles by Chinese manufacturers have turned them into formidable competitors on the European market.
China now produces nearly 40 per cent of the world’s manufactured goods. Its exports to Europe have risen by 40 per cent in seven years, whilst our exports to China have fallen by 30 per cent.
European citizens have overindulged in cheap goods, which have artificially propped up their purchasing power and now threaten the entire European economy. ‘Small parcels’ have thus caused considerable damage.
Europe’s annual trade deficit with China stands at €360 billion a year, or €1 billion a day. Every Member State has a trade deficit with China.
European industry is, in fact, paying a heavy price in the face of this unfair and aggressive competition. It is said to be threatening a third of its jobs – that is, 30 million!
The European Union is trying to respond and, above all, to equip itself with more effective tools to stem this haemorrhage.
European preference, particularly in public procurement, is finally beginning to gain support. An ‘Industrial Accelerator’ is currently being negotiated amongst the Member States, which already have an ‘anti-coercion instrument’ at their disposal but are still too hesitant to use it for fear of retaliation.
A ‘Made in Europe’ requirement is tentatively emerging.
And the Union is negotiating new trade agreements on all fronts, not only elsewhere in the world but also in Asia. Following on from Canada, Mercosur, Mexico, Australia, India and Indonesia, it is now in talks with the Philippines, Thailand and Malaysia.
These are significant steps forward.
However, they are still insufficient, and one cannot help but hope that the next European summit on 15 and 16 October will finally adopt a firmer stance.
The aim will be, in fact, to tighten the anti-dumping measures already adopted, to ban the ‘screwdriver plants’ setting up within the single market to sell Chinese goods, and to raise customs duties more rapidly in line with the Chinese barriers to the entry of European products.
The urgent priority is to protect ourselves from deliberate predatory behaviour without, for that reason, closing ourselves off from trade.
May Europe learn the rules of the game faster and begin negotiations with the Middle Kingdom.
