EU’s Incoherent Approach Towards China

Phar Kim Beng
Strategic Pan Indo-Pacific Arena
Twitter: @indo_pan

By Phar Kim Beng

Founder CEO

Strategic Pan Indo-Pacific Arena

Multilateral free trade agreements are shaped by market access. The larger the better. When their benefits become obvious and clear more stakeholders will climb on board. Creating a critical bass to allow the benefits of the free trade agreements to cascade downward, ideally, while the top feels sufficiently compelled to drive the free trade movement forward.

Back in 1953, 23 countries gathered together to form the General Agreement on Trade and Tariffs. Prior to that the Treaty of Rome helped France and Germany to reconcile their “existential” differences, which had often triggered both sides to go in war in the Franco-Prussian conflict, World War I and World War II. In all these agreements, the West flourished from them, together with it Japan.

By 1960, of the development economic theories that were abound, including one by Eugene Rostow, who argued that all economies must have the proper infrastructure and systems of banking before they can “take off” together, one of the most powerful theories yet was the Akamatsu thesis: Japan would take off first, invariably, by exporting their goods to the US, even service members of the US caught in the Vietnam War, and the the rest of Asia would follow in a reverse “flying geese formation”.

The benefits seen in East Asia lead the World Bank to refer to the region as a “miracle” as hardly one percent of a region could prosper together.

Economists like Jagdish Bhagwati at Columbia University, an advisor to the late Kofi Annan, the Secretary General of the United Nations (UN), further urged more countries to jump on board to the World Trade Organization (WTO) and World Intellectual Property Organization (WIPO).

Trade for the better word was an instrument to defuse human conflicts, to get all nation-states entwined in some form of what Joseph Nye and Robert Keohane at Harvard University once called “complex interdependence”. Trade functions as the operational source code of mutually assured transactions (MAT).

But if one were to look deeper, the conflict between China and Australia, invariably, Korea and Japan a few years ago, have all been marked by the initial ebullience of trade. However, when the likes of China, for that matter, Japan, has to register its strong vehemence to certain issues, Beijing for one has never shied away from “weaponizing” trade. Neither did Japan. In the case of China, this ranges from asking its citizens not to visit or study in Australia all the way to slapping egregious tariffs of up to 90 per cent on their barley and wine.

The EU is at its weakest moment ever due to the conflict between Russia and Ukraine. If anything, the EU should have tried to set its house in order before signing any investment agreement with China in December 2020. The agreement is now floundering.

The Council of Europe and the European Commission had prior to the agreement with China also described it as a “systemic rival”. If one already has the seeming evidence of defining the other in unsavory terms, it boggles the mind why the EU would want to conclude an investment agreement with China before even before the Biden Administration had formed his National Security Council then to consolidate the Transatlantic Relationship?

As for the promise of China to behave according to the norms of the International Labor Organization, with the provision to sign the covenant of the international civil and political rights in March 2021, it further undermined the coherence of the EU to let the much-dreaded National Security Law remain in place in Hong Kong.


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