US president Donald Trump’s administration is insisting that the European Union must choose between the United States and China on trade, according to recent reports in The Irish Times. His threat appears to be that any country that wants a trade deal with the US must distance itself from Beijing.
This tactic of intimidation is typical of Trump’s manifestly misguided belief that, both domestically and internationally, he “holds all the cards”. The EU is a major player in international trade and, notwithstanding the immense challenges it faces, it is well capable of taking its own decisions about relations with each of its trading partners. It will resist any diktats from Washington or, indeed, from Beijing.
The EU will continue to work to de-escalate the general chaos in international trade whipped up by Trump’s capriciousness, and in particular to reach a balanced agreement with the US with a view to minimising any increase in mutual tariffs or other unnecessary barriers to what remains the most important trading relationship in the world.
However, there are several good reasons for Europe to reject any US arm-twisting about how it should conduct its relationship with China.
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First and foremost, the EU should act in the interests of its own people rather than caving in to the whims of a US president who despises Europe for its democracy, decency and diversity. The EU, whatever other weaknesses it may have, is arguably the most experienced and effective trade negotiator in the world. It is well capable of balancing the interests of its member states internally and asserting them externally.
It is vital for European exporters and consumers, and for the prosperity of all our people, that the trading relationship with China is maintained and, if possible, enhanced.
The EU understands very well that it must be prepared to stand up to Beijing as much as to Washington. A US-China trade war would require the EU to resist any significant diversion of trade from either direction. However, it continues to make far more sense for Europe to “de-risk” its relationship with China than to “decouple” it.
It is self-evidently in the interests both of the EU itself, and of the world more generally, including the poorest countries, to avoid the massive disruption or diminution of trade that would result from a division of the world into two hostile trading blocks.
On international relations more generally, China tends to be more of a stabilising factor than Trump’s US, including on multilateralism and the climate change agenda. This does not mean for a moment that we should ignore China’s human rights record at home, or recent serious allegations, published in this newspaper, of transnational intimidation including of members of the Uyghur community in Ireland that are being assessed by the gardaí.
But it is important in today’s world, as a matter of principle, to resist Trump’s bullying tactics. He is seeking to remake the globe according to his own nightmare fantasy. His claims on Greenland, Panama, Canada and Gaza, as well as his disregard for international law and institutions, point towards his ideal universe in which “might is right” and the weak can simply lump it. That is the direct opposite of Europe’s world view. Europe must continue to provide global leadership on how to manage interdependence and on a respectful way of doing business.
There are many profound differences between European and Chinese values and interests. However, as Denis Staunton has pointed out recently in this newspaper, China’s strategy of refusing to capitulate to Trump’s aggressive trade agenda is being vindicated as the US administration makes a series of retreats. The EU is, needless to say, aware of this.
This brings us to the next reason for Europe to resist.
Watching Trump perform his weekly U-turns, it is clear that his level of unpredictability is such that it would be perfectly possible for him to decide in due course that, after all, he wants a close relationship with China. His fascination with strong leaders is well known. A Europe that had followed Trump’s encouragement to distance itself from China would find itself high and dry.
Meanwhile, reports of the strong line that Trump wants Europe to take vis-à-vis China don’t offer any hint that the US would, in return, soften its negotiating stance on trade with Europe. It would, apparently, maintain its insistence that the EU should accept imports of hormone-treated beef and chlorine-washed chicken. It would still insist on the weakening of EU regulations designed to protect the public from the most dangerous aspects of US social media companies. It is still on track to impose tariffs on European pharma products. The threat of higher general tariffs after then 90-day moratorium remains. So the US, in its attempted browbeating of Europe on China, wants something for nothing. The “art of the deal” it sure ain’t. There is no doubt that the EU will maintain its product and food standards as well as its regulation of big tech.
Finally, on Ukraine, the Trump administration has not yet made clear what side of the equation it will come down on. What is certain is that it has not, for the moment, put sufficient pressure on Russia to make possible a peace deal, or agreement on the utterly necessary consequent security arrangements. This is the one issue on which the US, if its support for Ukraine were to become forceful and definitive, could expect some additional flexibility from Europe on trade, although not on core issues of public health. However, even on Ukraine, the EU will not want to alienate China which has thus far not become directly involved and can continue to impose some constraints on Russia.
Bobby McDonagh is a former ambassador to London, Rome and Brussels
