1. The emerging multipolar world: multilayered and culturally diversified

The structure of the international system is changing with the evaporation of America’s unipolar moment. ‘The decline of U.S. primacy and the subsequent transition to a multipolar world are inevitable,’ Wang Jisi wrote in 2004.Reference Wang² More recently John Ikenberry stated that ‘The United States’ “unipolar moment” will inevitably end.’Reference Ikenberry³ Not only has the influence of the lonely superpower severely been affected by the expensive wars in Iraq and Afghanistan; its economic clout too has declined faster than ever before and its soft power is increasingly contested. At the same time, China is undeniably becoming a global power. Since the cautious opening up of China’s door by Deng Xiaoping in 1978, her economy has quadrupled in size and some expect it to double again over the next decade. China is about to become the second most important single economy in the world. At the most recent G20 meeting in Pittsburgh, Hu Jintao, China’s president was the only one to arrive at the head of a major economy still enjoying strong growth, having the luxury of substantial financial reserves.

But China is not only growing economically, its military clout is also on the rise.⁴ In 2008 China evolved into the world’s second highest military spender.⁵ It is the only country emerging both as a military and economic rival of the US and thus generating a fundamental shift in the global distribution of power and influence. Such power transitions are a recurring phenomenon in international politics and have always constituted episodes of uncertainty and higher risk. They contain the seeds of fierce strategic rivalry between the up-and-coming state and the residing leading power, thereby increasing the likelihood of contention and conflict. No wonder that China’s spectacular economic growth and increasingly assertive diplomacy have incited other key-players to ponder how Beijing will seek to manage this transition and even more how it will use its leverage afterwards. Notwithstanding that China still sees itself partly as a developing country, it is becoming more confident in its rising power and status. As its economic interests abroad are expanding rapidly, so will the pressure increase to safeguard them more proactively. National security is no longer solely a matter of defending sovereignty and domestic development. It also becomes necessary for China to back up its growing interests overseas with a more robust diplomacy and security policy.

To be sure, the US is still the most important single economy in the world. It also remains the world’s largest military power. While the EU has developed into an even larger economy and has become the most important entity in terms of external trade flows, politically and militarily it performs far below its potential and is no match either for the US or China. The EU’s foreign policy is confronted with a collective action problem of sorts, and as a result is lacking in both strategic vision and assertiveness. Although still smaller than the other two, China has grown into the world’s second largest national economy and also the one that grows most quickly. According to some estimates, China will move on a par with the US in 2020 and become the world’s biggest economy in 2030 (see Table 1). Moreover China is steadily increasing its military power. In Beijing’s view, economic prowess is not sufficient for a state to become a first rank power. ‘What is important is comprehensive national power, as shown by the ability of the Soviet Union to balance the much wealthier US in the Cold War and the continuing inability of an economically powerful Japan to play a political role’.Reference Hughes⁶ This view is very much in line with the neorealist conception that to be considered a ‘pole’ a country must amass sufficient power in all of Waltz’s categories of power: ‘size of population and territory, resource endowment, economic capability, military strength, political stability and competence.’Reference Waltz⁷

Table 1 The trend towards multipolarity: share of world GDP

Source: Economist Intelligence Unit.

The emerging multipolar structure is a multilayered one: it consists of two tiers (see Table 2). In the first tier we have the US and an ever more powerful China.⁸ The second tier comprises most regional powers like India, Brazil, South Africa, Russia, Japan, the large European states and the remaining members of the G20. They matter in a number of important international issue areas but are lacking in comprehensive power. Yet their weight is such that it is key for the first tier players to take them in account. The EU, because of its share of world GDP and world trade could be a first tier actor, but to fully qualify it would have to upgrade its hard power base: economic capability, political competence and military strength.

Table 2 Multilayered polarity

China’s ascent engenders a fundamental change in yet another sense. Because of China’s being different in terms of culture, history, economy, political system and stage of development, it poses a challenge to the era of Western hegemony at the level of system values and rules of the game. All these differences reduce the likelihood that Beijing will easily accept the systemic responsibilities that Western key players associate with great power status. Therefore, the ‘integration of China into the existing global economic order will thus be more difficult than was, say, the integration of Japan a generation ago.’Reference Ikenberry³

China’s rise is not only changing the distribution of power in the system, it also engenders a change in the distribution of identities. Understandably, the US and the EU would prefer to integrate China in the global governance structures they established and safeguarded in the past few decades and hope for a reproduction of the existing system. Yet it is far from clear how Beijing will seek to manage its position in the evolving international system and how it will strike the balance between power politics and multilateralism. Some point out that, precisely during critical power transitions, many emerging powers in the past have relinquished their resistance against imperialist policies by gradually starting to apply the very strategies themselves: the use of coercion to chase unequal economic gains, the creation of spheres of influence and the formation of alliances to prevent hostile powers from obstructing these ventures. Some expect that China too will inevitably go down this road.Reference Mearsheimer⁹ They expect power politics to gradually take the upper hand. Others point out that China is developing within a system with strongly established international institutions, which it makes ample use of to sustain its growth.Reference Lateigne¹⁰ As China is already firmly integrated in the current international regimes and benefits from their smooth functioning, they expect multilateralism to be a crucial ingredient of Beijing’s foreign policy. Beijing actually has a profound interest in seeing that the international rules and institutions function effectively. Yet the question remains to what extent Beijing will use its growing influence to transform the international system and bring its rules and institutions more in line with the country’s national interests.Reference Lateigne¹⁰

2. China’s identity: power politics and neo-mercantilism

It has to be said that, for the most part, the Chinese elite has managed to keep a low profile and assess China’s capabilities and resources rather aptly throughout. Pragmatism reigns supreme, and there is ample cause for this. Despite the fact that China has made enormous progress in the 30 years since the launch of the economic reforms, developing into the world’s leading trading power,¹¹ it still does not score very highly in terms of GDP per capita. In addition, it is also increasingly faced with the fallout generated by the widening gap in levels of prosperity between different regions, urban and rural areas, the rich and poor. Finally, the ecological degradation of the land is spreading ever more rapidly. In view of these factors, Chinese leaders are steering a course where what is needed for the development at home defines the contours of foreign policy.

The Chinese dragon’s ambitions for world power thus have to be curtailed for now. The current leadership can only maintain its position if it manages to resolve within a reasonable timeframe the many problems China faces. The economic motor must be kept running at all cost, an impossible feat without stable relations with its Asian neighbours and the global community. Beijing has a difficult time navigating between the two dimensions of China’s identity. It is constantly involved in a tug-of-war between its ‘weak power identity’ (developing country) and ‘strong power identity’ (great power). It is why China’s foreign policy appears so inconsistent at times. At present there is a propensity in its foreign relations towards the notion of ‘China as a responsible global power’, but there are some notable exceptions to this tendency. A prime example of this is China’s hunger for oil and strategic resources. Sustainable economic development is undoubtedly the final goal, but it cannot be realised without the necessary energy and raw materials supplies. Should these not be sufficient, the nation’s wholesale development will be compromised, and consequently the outright survival of the regime would be at stake.

This is indeed a tight corner to be in. It is very tempting to put one’s own pressing interests first whenever possible in such circumstances. Those are the moments when absolute sovereignty and the immediate national self-interest get to play first fiddle. That is why China’s diplomacy rather often comes across as a chameleon. It dutifully adapts to whichever circumstances it finds itself in so as to safeguard the interests of the motherland. Multilateral negotiations about regional stability and the further direction globalisation is to pursue are, after all, very different from bilateral talks aimed at securing highly desired economic benefits or guaranteeing access to crucial strategic raw materials. In the case of the former, Beijing has time on its side and the rhetoric of peaceful evolution and civilized renaissance comes in handy; in the case of the latter, negotiations mostly come down to serving the immediate national interest and driving home the best bargain.

China is a ‘pandragon’.Reference Geeraerts and Holslag¹² It has a double identity, i.e. a ‘weak power identity’ and a ‘strong power identity’. At times, it considers itself a mere developing country that was wronged by the imperialists and is therefore entitled to a great degree of leniency and support. At other times, it sees itself as a great power that is well on its way to restoring the glory of the ancient empires and wants to be treated on an equal footing. That is why Beijing is so sensitive to be taken seriously and be treated as a peer. At the same time, however, the Chinese still count on consideration from the other side, some special treatment. China, although growing fast, is at a different stage of development and has to overcome a great number of internal problems as a result of which it cannot as yet take up the full scale of its international and bilateral responsibilities. To cut a long story short: the domestic economic development is the most pressing challenge; the evolution of China into a responsible strong power is the long-term ambition.

On closer examination, China’s developmental model and associated economic strategy is neo-mercantilist. It anxiously works to maintain equilibrium between national sovereignty and international integration, particularly between integration in the global market and economic independence. Control by the state apparatus crucially acts as a counterweight to market forces.Reference Gilpin¹³ The state needs to ensure that the market operates, both at home and abroad, in a way that is entirely conducive to the expansion of Chinese influence and power across the globe. At the same time, the government must make sure that this whole process generates enough prosperity, which can then, after the necessary redistributive measures, guarantee social stability and cohesion. Direct domestic investments remain crucial for further economic development and, in exchange, the domestic industry must play its part, whilst the government retains a finger in every pie. Ultimately, this entire process needs to be accelerated by a go-out policy that, again under the guidance of the state, should safeguard access to foreign outlets and strategic raw materials.

3. The EU: reshaping the power paradigm?

The EU’s identity is rather distinct from that of China. It is often perceived to be a normative actor, founding its policies on values, institutions and cooperation rather than power politics. As such, the EU constitutes an effort to reshape the power paradigm to reflect a new kind of power in global politics. As stated in its 2003 Security Strategy, the EU aims at the ‘development of a stronger international society, well functioning international institutions and a rule based international order’.¹⁴ The rules underpinning this new international order are to be founded on Europe’s liberal political norms, its views of an open global market and its preference for highly institutionalized multilateralism. Similarly, the relations with the emerging powers are largely constructed from the belief that the latter should adapt their international political norms to the European standards. Normative convergence is thus the starting point for developing relations with emerging countries. Europe’s policy towards China has to date been one of conditional cooperation. The EU is prepared to help the PRC, to invest in the development of the country, but in turn, China must meet a number of standards and demands. This is a rather unique way of dealing with a rising power. In contrast to the United States, Europe is not gearing up for a confrontation if needed. So-called ‘hard power’ is hardly on the agenda. European nations are not taking up bases in Asia to curb Chinese influence in case this might be necessary. Power politics, based on military capabilities and threats to use force, seems to have disappeared from the diplomatic handbook all together. On the contrary, Europe wishes to forge a tighter link and strengthen its influence through ever-increasing economic interdependence and shared values. In this process, Europe sees itself as the model China should aspire to. EU policy is based on the belief that ‘human rights tend to be better understood and better protected in societies open to the free flow of trade, investment, people, and ideas. As China continues its policy of opening-up to the world, the EU will work to strengthen and encourage this trend.’¹⁵ British top diplomat Robert Cooper champions this approach in an often-quoted book, where he talks about a post-modern security strategy with the emphasis firmly placed on values and international cooperation rather than hard power and control over territories. ‘Nationalism makes place for internationalism’, he writes. ‘The final goal is the liberty for each individual.’Reference Cooper¹⁶

The crucial question is to what extent this approach can be actually successful. Beijing has not put democracy and respect for human rights at the top of its list of priorities. In terms of foreign policy, it is unrealistic to think Beijing will comply with Europe’s ‘post-modern’ discourse. If one, in accordance with Robert Cooper, distinguishes between ‘modern states’ and ‘post-modern states’, then China is to be categorized as a ‘modern state’, for which ‘internationalism’ is but one modus operandi serving the national interest. The PRC is therefore by no means at a point where it can meet the European expectations. Chinese officials, scholars and pundits all tend to indicate this when talking in private. It is crucial for the EU to be aware what power it has to sway policy in China. An important parameter in the EU’s dealings with China will be the strategic weight Brussels will be capable of bringing to bear with Beijing. China perceives the EU foremost as an economic actor, far less as a political actor. One reason why Beijing for example wants the partnership and cooperation agreement (PCA) negotiations to focus on trade and economic cooperation might be that it has doubts about the EU’s capacity to really deliver in the political domain.

The EU should also be critical of its leverage as a normative actor. China may well recognize the advantages of cooperating with the EU and of learning from it in certain areas, but it is certainly not willing to accept the tutelage of the EU. China is not a prospective EU member, nor does it see itself as a weak nation, depending on the EU for support in its political and economic reform process. Perhaps the most real incentive that the EU has to offer is access to its market. The EU’s success with China will to a large extent rest on the recognition of common interests, in areas such as the environment and energy, but also in trade and investment. The degree to which China’s interests match those of the EU will determine the success of the relationship.

Some experts in Chinese think tanks are wondering to what extent the EU will be able to succeed as a post-modern actor. For the time being, they seem to give Brussels the benefit of the doubt. Although they are rather sceptical, they do not exclude that with time the EU might prove to be successful in making a difference in the area of global common goods, and therewith increase its political weight in affairs that matter more and more in an era of globalization. In a recent survey of political and economic Chinese elites in Shanghai, a majority of the respondents claimed that in the future the EU would come to rank as the number one actor for China.Reference Holland, Ryan, Nowak and Chaban¹⁷ Be it as it may, if the EU is to raise its effectiveness as a normative actor it should make clear to Beijing that strategic weight doesn’t inevitably flow from power politics, but that in an era of globalization and increasing interdependence it also can be generated by a true commitment to effective multilateralism based on common interests and institutional bargaining. In this light, it is necessary to gather the necessary expertise to assess the domestic political and economic developments in a more profound way, as this will allow for a better idea of which benchmarks Beijing can realistically meet and the time it needs to reach them. The availability of similar expertise will also permit one to have a more critical and better-informed assessment of the Chinese claims for leniency and flexibility on the basis of being at a different stage of development. All this would add significantly to the EU’s bargaining position as a ‘postmodern actor’.

4. A pragmatic relationship

The Sino-European partnership has been going trough turbulent times in the past four years. As it stands, the partnership is not strategic, but it has vast strategic potential. The challenge will be to work out a pragmatic consensus on how to gradually turn joint strategic interests into more result-driven cooperation. Given the distinctive identities of China and the EU and their different development paths, this process will inevitably have to be commensurate with the two partners’ internal transformation. After a period of difficulties over issues such as Tibet, climate change and alleged economic protectionism, both sides are now figuring out how to best position themselves in the future. Beijing is executing an important review of its major relationships, and one of the questions is where the EU will fit in. There is growing momentum for synergies with Washington, leading to speculation about a new transpacific axis. But in the multilayered multipolar world it will remain a key challenge for China to maintain good relations with the other powers too. For Europe, the adoption of the Lisbon reform treaty could halt its descent into strategic redundancy and instigate the EU to assure protagonists like China that it has indeed the ambition to develop solid strategic partnerships.

The years ahead will thus be ones of relation therapy. Europe and China need to define for themselves what they consider to be the main interests driving their partnership. For the EU in particular, it is a matter of finding a remedy against the kind of diplomatic schizophrenia in which short-sighted policies of member states counteracted the proselytizing European Commission. It would be a good start to evaluate the effectiveness of the current instruments for engaging China. More efforts should also be made in bringing member states around the table to deduce a common denominator from their often-diverging national interests. If Europe is to constructively engage China, it will first have to engage itself collectively.

Simultaneously, China and Europe have to agree on which interests they will build the pillars of their strategic partnership. One of the main setbacks in the EU–China partnership has always been the obsession with dialogues without a common view on how the new world order actually binds them together. Obviously, the global financial crisis and the subsequent economic recession have confirmed the necessity to reshape our economies. Both China and the EU face important challenges to combat unemployment, improve social welfare, and be more efficient in using scarce natural resources. Increased investment in innovation, a secure climate for creative development and a dynamic services sector will be vital for developing new and sustainable sources for growth. This is an individual responsibility, but it can only be successful in a climate of trust and reciprocal openness. Both sides are confronted with similar social challenges: an ageing population, an ethnically heterogeneous society, growing urban areas and substantial internal economic differences. China and the EU have a common interest in enhancing social equality and welfare. While facing different economic limitations, both sides are aiming to make their development inclusive and harmonious. Rather than lecturing to each other, there is an opportunity to exchange lessons learned. The emphasis should not be on differences per se, but on commitment and progress.