New Momentum in Sino-European Relations

The visits of French President Emmanuel Macron and European Commission President Ursula von der Leyen to China highlight the mutual interest in reviving Sino-European relations. Only a few weeks after the Two Sessions, diplomatic engagement is accelerating, with Spanish Prime Minister Pedro Sanchez recently attending the Boao Annual Forum in China.

The Sino-European partnership is multifaceted and characterized by a dynamic interplay of agreements and disagreements. The more China and Europe engage with each other, the better. Against this backdrop, the joint decision to resume high-level dialogue is encouraging. President von der Leyen emphasized the importance of this resumption in her press conference. Meanwhile, the human rights dialogue continues, with the 38th session held in February.

Trade remains a critical pillar of Sino-European relations. Last year, China ranked as the EU’s third-largest partner for goods exports and the largest partner for goods imports. Eurostat data reveals that European exports to China rose to 230.3 billion euros ($251 billion) in 2022 from 223.5 billion euros in 2021, while imports increased to 626 billion euros from 473.8 billion euros. Germany, France, the Netherlands and Italy were the biggest exporters and importers.

From a European perspective, discussions with the Chinese government can address the widening EU trade deficit. In 2022, this deficit reached 395.7 billion euros, up from 250.3 billion euros in 2021, 182.3 billion euros in 2020, and 165 billion euros in 2019. European companies, recognizing the massive potential of the Chinese market, are exploring new opportunities in untapped sectors. Chinese Premier Li Qiang has already signaled China’s commitment to continuous opening up.

Regarding Sino-French economic relations, French exports to China slightly declined to 24.1 billion euros in 2022 from 24.4 billion euros in 2021, while imports increased to 77.7 billion euros from 63.8 billion euros. President Macron’s delegation to China included representatives from major businesses, reflecting a shared desire to enhance economic collaboration in trade and investment. In one notable example, Airbus signed agreements with Chinese industry partners for new aircraft supplies and production site expansions. Airbus predicts China’s air traffic to grow 5.3% annually over the next two decades, significantly outpacing the global average of 3.6%.

Beyond economics, progress is being made on environmental and climate change initiatives. In 2019, China and France signed the Beijing Call for Biodiversity Conservation and Climate Change. In November 2022, the Chinese Ministry of Finance and the French Agency of Development went further and signed an agreement to support China’s biodiversity with EU funds. President von der Leyen publicly acknowledged China’s role in the Kunming-Montreal Global Biodiversity Framework during her press conference.

Obviously, security should not be overlooked. France, which welcomed the restoration of diplomatic relations between Saudi Arabia and Iran under Chinese mediation, hopes China can leverage its influence to halt hostilities in the Ukraine crisis – a position shared by the EU. Although the Chinese and European perception of the Ukraine crisis is different and no breakthrough is expected yet, there is a common interest in supporting peace and preventing escalation. In January 2022, China and France signed a joint statement of the leaders of the five nuclear-weapon states of the U.N. Security Council on preventing nuclear war. Engaging in regular dialogue will only help, and the visits of Macron and von der Leyen to China represent another step in the right direction.