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How Europe’s Big 3 Are Shifting on China

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At a time when U.S.-China relations seemingly plunge to new successive lows every day, with Washington and Beijing exchanging tit-for-tat responses in shuttering consulates and with President Donald Trump pursuing an all-out assault on Chinese tech, the European theater in the emerging Cold War is reaching an equally escalatory albeit quieter inflection point.In recent weeks, the United Kingdom has made substantial moves to shift its China policy, first by inviting Hong Kong British Overseas passport holders to apply for permanent residency, and second by excluding Huawei from its 5G networks from 2027 onwards. France has followed the U.K.’s lead on both accounts, refusing to ratify an extradition treaty with Hong Kong and requiring local operators stop using Huawei by 2028. As for Germany, it finds itself as the last of the E3 and the ultimate decision maker on which way Europe could swing.Opportune timing has ensured that German leader Angela Merkel is in no short supply of both influence and pressure. Germany assumed in July the EU’s six-month rotating presidency. But perhaps more importantly, Merkel’s political legacy is on the line as her 15-year long reign as chancellor of Germany will come to an end a year from now. Over her long tenure, Merkel has made the China question a key part, if not the defining aspect, of her foreign policy.Just three months ago, the geostrategic landscape in Europe vis-à-vis China was different. Discussion was rampant about how Chinese “mask diplomacy” was winning friends left and right. Scenes of waving Chinese flags and hundreds of Chinese cargo planes carrying medical teams and equipment blitzed across European media. And China’s PR offensive to refurbish its image, even if sloppily executed, was still a far better effort than the absence of the United States.But on July 14, in a move that will be remembered as the first in a chain of critical dominoes, the U.K.’s 180-degree about-face to ban Huawei stunned the world. The U.K. government’s decision to implement a ban on British telecom operators buying Huawei equipment and the directive to remove existing Huawei 5G equipment by 2027 sent shockwaves rippling in national capitals across Europe. For months, EU countries hid behind the U.K.’s strong assertion that it could adequately manage Huawei’s risk. Following the abrupt announcement, however, European countries across the board find themselves deprived of cover.The reaction is quite paradoxical — in the wake of Brexit, London is playing the greater leadership role it was trying to abandon while it was still tied to its EU membership. Prime Minister Boris Johnson’s call for the U.K. to return to “global Britain” has been answered aggressively and has invigorated London to act more like its former imperial self. &nbsp;Meanwhile, Germany and France have somewhat struggled to unify the EU approach to China in Brussels.British Foreign Secretary Dominic Raab has been the man at the helm — directing a flurry of activity from London that has elicited a biting response from China’s Ambassador to the U.K. Liu Xiaoming and drawn wrath from Beijing. The ever-widening clash over Hong Kong has led to a multitude of responses — including the suspension of the extradition treaty, the opening of a path toward citizenship for British National Overseas (BNO) passport holders, and trade restrictions on sensitive police equipment. What’s more, the U.K.’s newest aircraft carrier will soon begin patrolling the South China Sea with potential basing in Brunei or Singapore while Liu has sparked outrage over his public and adamant denial of verified Xinjiang drone footage showing Uyghur prisoners blindfolded and being led onto trains.On July 22, following the U.K.’s landmark decision to lock Huawei out, France also decided on a de facto ban on 5G Huawei gear by 2028. Paris’ decision was more calculated and less brazen than London’s, though — France’s national cybersecurity agency ANSSI told operators that it will “only grant licenses authorizing use of Huawei equipment for three to eight years.” Critically, these licenses will not be renewed once past expiration. France’s decision has essentially given telecom operators until 2028 to eliminate Huawei equipment from their networks — a maneuver that is just the latest and most creative in a string of workarounds to reject Huawei while avoiding issuing an outright ban.And thus, Germany has become the final important battleground for 5G in Europe. As a non-member of the Five Eyes intelligence network, Germany finds itself with more autonomy than the United States’ Anglo-Saxon peers. But while Germans (and many Europeans) may indeed side with the U.S. on a number of China-related policy disputes, U.S. pressure has likely had the opposite effect. Brash and corrosive rhetoric from Washington has made it difficult for Berlin not to waver in its partnership.Perhaps most evident of this fraying transatlantic partnership is the way German elites are preparing for a post-Merkel future. The chancellor’s positioning on China may have decidedly hardened after a landmark 2019 visit to China, touring the high-tech labs of Chinese giants including Huawei and Tencent. Upon her return, the — a blueprint for the post-Merkel era to avoid economic stagnation by transforming traditional German engineering and manufacturing power to a digital state fueled by technology. Neustaat, a pun that means both “new state” and “new start,” includes revolutionary measures such as restructuring the Euro around blockchain, implementing AI across government, and dissolving entire ministries in favor of data-driven decision-making.The plan specifically criticized Germany for “being too bureaucratic, complex, and slow to deal with the challenges of the new digital world order.” And as an antidote, Merkel sees a partnership with China as the only viable option for securing this high-tech future for Germany. Outside the tech realm, Merkel has thus far been the most equivocal on a number of the contentious issues being fiercely debated — but in the end, her government had to follow other Western democracies in imposing sanctions over Hong Kong’s new national security law.It’s not just Merkel facing a difficult decision, Beijing most likely senses that the window to finally reach an investment deal with the EU is rapidly shrinking, with the chance of success likely dropping significantly after Merkel’s exit. After all, if China can’t secure such a deal with her driving the agenda, it’s hard to imagine a stronger business partner with as much influence. China may also have a completely different intention — further delay comprising on the investment deal and just wait it out for the remainder of Merkel’s term. After all, talks have dragged out for years — what’s six more months?&nbsp; Either way, there’s no doubt Beijing places great importance on the E3 in its decision-making and thus, while London, Paris, and Berlin may not be coordinated in their approach, the rare alignment of hostile foreign policy is cause for concern and weighing on the strategic calculus in Zhongnanhai.Get first-read access to major articles yet to be released, as well as links to thought-provoking commentaries and in-depth articles from our Asia-Pacific correspondents.As Germany still hopes to host an EU-China leader’s summit this year in some form, Angela Merkel is the one to watch. She feels the pressure more than ever to navigate this clash of narratives to simultaneously deliver on a long-awaited bilateral EU-China investment deal, make Europe’s last big decision on Huawei, and cement her political legacy, all while securing the future of her nation in a time of dangerous geopolitical uncertainty.Philippe Le Corre is a research fellow at the Harvard Kennedy School’s Mossavar-Rahmani Center for Business and Government (M-RCBG) and a nonresident senior fellow at the Carnegie Endowment for International Peace. John Ferguson is a research assistant at the Harvard Kennedy School’s M-RCBG.

At a time when U.S.-China relations seemingly plunge to new successive lows every day, with Washington and Beijing exchanging tit-for-tat responses in shuttering consulates and with President Donald Trump pursuing an all-out assault on Chinese tech, the European theater in the emerging Cold War is reaching an equally escalatory albeit quieter inflection point.In recent weeks, the United Kingdom has made substantial moves to shift its China policy, first by inviting Hong Kong British Overseas passport holders to apply for permanent residency, and second by excluding Huawei from its 5G...

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