Gogi Kamushadze

newsletter

Brussels flinches, Sweden stiffens, China’s jabs triumph

Hello, and welcome to China Influence Monitor, a weekly newsletter published by CEPA and Coda Story and edited by me, Edward Lucas. We track the westward footprint of China’s influence operations, and their effects on politics, economies, societies and alliances across Central Asia, the Caucasus, Russia and Europe.

TOP CHINA INFLUENCE STORY OF THE WEEK

The European Union rarely misses a chance to miss a chance. Faced with the accelerating crackdown in Hong Kong, it could have imposed sanctions on the officials responsible, or asked all EU countries to cancel their extradition treaties. Instead, foreign policy chief Josep Borrell said the EU would (wow) increase outreach to civil society groups, coordinate with international partners and press the Chinese authorities. If things get worse (drumroll) further steps will be taken. 

Borrell’s disastrous trip to Moscow, however, where he was publicly humiliated after seeking a reset with the Kremlin, did spark a slightly tougher EU response to the jailing of the anti-corruption campaigner Alexei Navalny. Perhaps a visit to Beijing might have a similar effect?  

But some European governments, especially smaller ones, are showing oomph. It’s not just the pushback against Huawei.

  • Slovenia, Croatia, the Czech Republic and Romania have suspended China-related public tenders. 
  • Greece is debating whether a Chinese shipping company gets a bigger stake in the port of Piraeus. 
  • Lithuania has banned Nuctech security equipment from Vilnius airport (we wrote about Nuctech in Estonia earlier). 

What this shows: China hoped that public procurement wins — rocketing lately according to a Wall St Journal analysis — would make up for slowing direct investment. But in hawkish countries, low-bid tactics don’t work any more. Screening trade and investment for national-security reasons is OK. Not least because the EU says so.   

Meanwhile, Germany has admitted that China harasses Hong Kong protestors on its soil. It would be nice to think that the police are investigating. We’ll keep you posted. 

OTHER KEY CHINA TRENDS: 

France is sending two more warships to the South China Sea for exercises with the US and Japan in May. This follows a nuclear submarine deployment there last week. A clear example of Emmanuel Macron’s tendency to say the wrong things — but do the right ones. The more European countries do to help the US in the Indo-Pacific, the more they can expect when their own security is at stake. It will be interesting to see whether the French vessels risk a trip through the Taiwan strait.