Battered relentlessly by former President Donald Trump over four difficult years, relations between the United States and the European Union are back on track, with China providing an important spur for the renewed warmth. Expect no automatic and complete U.S.-EU alignment of views on China, however. As it gets underway, the transatlantic conversation will spotlight both convergences and divergences in the United States and EU approaches towards Beijing. For all their enthusiasm for President Joe Biden’s interest in working with allies, EU leaders have no appetite for a China policy based on confrontational zero-sum games, starting another calamitous cold war or a discussion dominated by hard security and references to preserving U.S. primacy in the Indo-Pacific region. 

Biden was the online “guest of honor” at the virtual summit of European Union leaders held on March 25. Only hours earlier, Secretary of State Antony Blinken and Josep Borrell, the EU High Representative for foreign and security policy, relaunched the U.S.-EU dialogue on China. Having started hesitatingly and reluctantly with former Secretary of State Mike Pompeo, Borrell has now promised regular consultations with the United States at the senior official and expert level to discuss the “full range of challenges and opportunities” posed by China.

Fresh from his blistering encounter with Chinese counterparts in Anchorage, Blinken’s message to the EU and later to NATO allies was predictably straightforward: Europe and the United States must join hands to fend off China’s “coercive behavior” and attempts to undercut the rules of the international system. 

Europe-China Relations Have Reached a New Low 

In some ways, Blinken was preaching to the converted. Attitudes towards China are hardening in most European countries. Relations with Beijing have reached a new low following acrimonious tit-for-tat sanctions following an EU decision to ban travel and freeze the assets of four regional and party representatives held responsible for the mistreatment of Uighurs. China’s reciprocal decision to impose similar restrictions on several members of the European Parliament but also on a number of European academics and policy institutions for allegedly engaging in “malicious lies and disinformation” has been described as unacceptable, immature and disproportionate by many EU policymakers, prompting speculation that the EU-China investment deal agreed last December will not be able to secure parliamentary approval.  

A joint statement by over thirty European think tanks voices deep concern that China’s actions against independent European researchers “undermines practical and constructive engagement by people who are striving to contribute positively to policy debates” and damages EU-China relations. 

Already fraying in response to Beijing’s assault on what an official EU statement describes as Hong Kong’s “democratic accountability and political pluralism,” relations between Europe and China are in bad shape—and could get worse if, as expected, EU sanctions are also imposed over Chinese policy in Hong Kong. EU governments are also keeping a close watch on developments in China-Taiwan relations. 

Tensions with Beijing are certainly an added impetus to the EU’s warm embrace of the Biden administration and hopes for re-igniting transatlantic relations. The EU’s sanctions over Xinjiang were in fact followed in quick succession by the United States, Canada and Britain, proving the twenty-seven-nation bloc is serious in its commitment to consult America and other countries on common approaches towards China.

Europe’s Strategic Autonomy in China Policy Will Persist 

But the old and tired transatlantic transcript which puts America at the head of the table and positions EU leaders as willing listeners and avid followers is hopelessly out-of-date. The EU and the United States will not see eye-to-eye on all aspects of their complex and multi-layered ties with China—and more broadly with Asia. EU policymakers agree with the United States on the strategic challenge presented by China’s growing international assertiveness. However, they do not always agree on the best way to address this problem.

The truth is simple, albeit unpalatable for many U.S. policymakers: Having weaned themselves off over-reliance on America and started to show more self-confidence both at home and abroad during the difficult Trump years, and given the realistic European fear that future U.S. elections could produce more incompetent and chaotic Trump-like administrations, EU leaders will not sit back and take instructions from Biden and his team, nor have confidence in the sustainability of U.S. leadership. 

Biden’s “America is back” rhetoric, therefore, rings hollow across a continent that is seeking “strategic autonomy” in its domestic, trade, technology and foreign and security policies. Neither does it fit the EU’s understanding of a changing world where other nations are not waiting or dependent on U.S. leadership. Biden’s warnings of “extreme competition” with China over the coming years isn’t exactly what the EU has in mind either since most Europeans are not as China-focused or China-obsessed as Americans and mostly do not see China as an existential threat. 

Also, despite the new warmth in transatlantic ties, U.S.-EU relations have long been marked by cooperation and competition. Brussels and Washington are still on a collision course on steel and aluminum tariffs, on digital taxes, and on public procurement. Germany is seething at suggestions that it could face U.S. sanctions over plans to pursue the Nord Stream 2 pipeline to import Russian gas. 

Europe’s heavy hitters are behind such autonomy. French President Emmanuel Macron has warned against any expectations that the EU will gang up with the United States against China, saying such a confrontational option would be counterproductive. It is a sentiment shared by the German Chancellor, Angela Merkel. Both the French and German leaders believe the EU must pursue its own interests in relations with Beijing and remain strong supporters of the EU-China investment agreement despite criticism by European parliamentarians and human-rights organizations. 

Compartmentalization Is Key to Combining Cooperation and Competition

Blinken appeared ready to play ball—at least while in Brussels. The announcement of the U.S.-EU dialogue on China that Blinken and Borrell launched in Brussels shunned references to “adversarial” relations with China, the term often employed by the United States. Instead, echoing the EU language, ties with China were described as “multifaceted, comprising elements of cooperation, competition, and systemic rivalry.” Blinken was also careful to insist that the United States was not excluding cooperation with Beijing on some issues, adding that the emphasis would be on innovation, not ultimatums. 

Biden’s invitation to Xi Jinping to join the virtual Climate Change summit on April 22 and European Commission Vice President Frans Timmerman’s recent online discussions with China’s environment minister Huang Runqui are a reassuring sign that the competition/cooperation template has operational traction and that environmental issues are not getting entangled in the wider geopolitical wrangles. Additionally, EU policymakers know they need to work with China on ensuring a post-virus economic recovery, thrashing out ways to deal with any future pandemic and tackling the nuclear challenges posed by North Korea and Iran.

With growth and jobs on the EU agenda more than ever, maintaining buoyant trade and investment flows with China will remain a top priority. As such, just as they stood up to the pressure of the Obama and Trump administrations not to join the Asian Infrastructure Investment Bank or participate in the Belt and Road Initiative or demands to impose blanket sanctions on Huawei, EU governments will likely continue to ply their own (albeit rollercoaster) course in relations with Beijing. 

Much to the chagrin of many in both the United States and China, this means that the EU will not be giving in to demands that it makes a binary choice by selecting a side in the worsening rivalry between the two nations. EU governments will work hard to forge closer transatlantic ties and will continue to engage with China through their high-level dialogues on economics, climate, digital policy and research and innovation.  

And much to the anger of those demanding a clear link between trade and human rights, this also means continuing to “compartmentalize” between moves to upgrade economic ties with China while getting tougher through so-called “autonomous” or unilateral EU rules which deal with inward investments, global supply chains, the conduct of state-owned enterprises, and the impact of foreign subsidies on enterprises operating in Europe, as well as on human rights. As some in Brussels see it, these targeted regulations–and in particular the EU’s new “Magnitsky-like” human-rights legislation–should reassure those demanding tougher EU action on rights and stronger reciprocity in EU-China economic relations and may help secure ratification of the investment deal once it reaches the European Parliament for a vote early next year. 

Both Beijing and Washington Must Adjust Their Relations with Europe 

Looking ahead, Washington will have to come to terms with Europe as an equal partner, while China also wakes up to an EU which, while striving to build closer economic ties and eschewing confrontational competition, will be ready to hit hard on questions related to human rights and fundamental freedoms. 

On China’s part, this reality requires that Beijing show more restraint, courtesy and a sense of proportion in its responses to EU criticism of China’s policies, both in bilateral and multilateral formats. It means Beijing must rein in its more strident “wolf warrior” envoys while listening to those advocating dialogue and developing more sophistication in understanding how the EU, with its diversified power centers and twenty-seven nations, can and does actually work together and can forge compromises even on difficult questions linked to China.