Convert prospects into leads in European Union

How to create outlook signature

before we uh jump in I just have one Logistics note we do welcome questions from the audience um if you do have a question you'll see that there's an option on the event page to submit one please just put your questions in there um and my colleagues will be looking at them and we'll I'll do my best to incorporate them if they're in the same stream as the direction of the conversation at the time so digging right in um you're here to hear from this esteem panel of experts I thought I could start by looking at the state of play in EU debate on China um and Noah first and then maybe lyanna as we conclude 2022 I think observers of the EU China relationship are left with some questions around where this relationship stands whether and how for example the site invented um in Europe's foreign and security policy comes with implications not just for Europe's approach to Russia but also for its approach to China can you give us your sense of how European assessments of China's arrival competitor and partner have developed over the past year and what have been some of the major turning points so we'll start with Noah um and then go to lyanna uh well thanks to Lily and Thanks Max good to see uh all of you lyanna Matthew and and Mikko um yeah I think does that site inventor apply to China I I think it it really depends on who you ask here in Berlin at the moment we've had two leaked papers from the German farm Ministry and the German economy Ministry over the past weeks and they uh if if you look at them they're calling for a pretty fundamental reassessment of the uh of the relationship with China uh and and I think they frame the the conflict in Ukraine as a broader lesson for German and and European policy makers essentially in two ways one one should not assume that a uh that a conflict can't or won't happen because of our interpretation of what a foreign leader like Putin or she uh uh yeah what what his interests are uh and and and two um one should be very careful about uh building up economic dependencies on a geopolitical competitor or rival uh so that's one part of the German government if you if you talk to people in in the Chancery you probably uh get a different response um this morning I printed out uh Olaf Schultz's article in foreign affairs it was 19 pages long on my printer China is mentioned 11 times uh Russia is mentioned 45 times the China section starts on page 14 of 19 and is just one page long and China and Russia are not mentioned in the same sentence once uh so uh so you see that the differences uh here within within the government in Berlin Germany is coming out with a national security strategy in the first quarter of next year uh this is going to have to bridge the gap somehow within the government uh so it'd be interesting to see in that in that how Russia and China are described I I think the fundamental question that Germany faces at the moment given the economic uh blows that it is uh suffering uh as a result of the war in Ukraine surrounds its willingness to to pay short-term economic prices for uh long-term National Security uh gains I don't I don't think we're quite there yet you know in the in the in the upcoming German China strategy they talk about uh making some tweaks to investment guarantees and all that but if you look at uh the recent decision on Costco go Costco's bid for a stake in a terminal at the Hamburg port if you look at Schultz's decision to bring a business delegation to China if you look at the outsized role that Huawei still plays in the German 5G Network this suggests that uh paying a short-term economic price is is not is not something that is acceptable to some people in the government um and and that to a certain extent is understandable Germany is is suffering some real uh top going through a real tough economic period I maybe a final point I think the rest of Europe sees this uh it I think it makes it more difficult to to get a European consensus uh on China which is difficult in the best of times uh it simply increases the risk that everyone is gonna is gonna pursue uh their own interests so uh it's an interesting time in EU China relations all the this flurry of meetings that we've seen over the past few weeks uh clearly China is is engaging with the world again uh and Europe is Keen to engage with China uh so so we're gonna have to see how this develops over the over the course of 2023 great thank you Noah Liana what are your thoughts thank you Lily it's always a humbling experience to follow Noah who's such a connoisseur of the debate in in Berlin and Brussels that I will try to add a few point which perhaps might help to understand a little bit better the debate that we see right now and I think Noah very widely pointed to this Foreign Affairs article of Olaf Schultz and there are two lines that I find particularly interesting in how he lays out his vision of Titan vendor and the world that China policy should play there because in a sort of in the perception of policy makers when the the change of an error announcement that Olaf Schultz has given in his speech three days after Russia's invasion of Ukraine really has escaped the logic of European security by now I mean back then it was a speech that was given at a time when Ukraine was considered not to be able to withstand Russia's attack so it was basically Russia at the gates at this time it was very much focused on European security but in the imagination of think tankers policy makers it has become this this shorthand for a big geopolitical Awakening of Germany which obviously should also include China policy and in this regard the the article of Olaf Schultz well certainly a disappointment because what he outlined then his idea of a global site in vendum is not Global in terms of not only European security but also China what he outlines is that um he does not see a world where the United States is pitched against China so she he doesn't want to subscribe to a new Cold War but he also says that China's wise does not want isolating Beijing or curb incorporation at the same time China's going power in a quote here doesn't justify claims for hegemony in Asia and Beyond and for someone who is like me who has worked for a long time on Russia policy this resembles very much the having the cake and eating its strategy that we've seen with Russia before 2022 so on the one hand um criticizing the Ambitions of having a sphere of influence in in the neighborhood but on the other side saying well we still need cooperation and we should not curb cooperation or isolate our um our our partner adversary however you might call it and I think it's interesting that the similarity does actually have common rules so policy towards Russia and China after the end of the Cold War from a German perspective was very much based on this German success formula from the end of the Cold War of of change through trade the idea that you can achieve some kind of convergence with Partners like Russia and China and the idea of change through trade was certainly abandoned with Russia earlier than it was abandoned with China but at least some parts of the business Community the big companies in Germany still adhere to this idea or at least do not see the dangers of interdependence in the same strong way as Germany has come to realize the dangers of interdependence um with Russia so Germany might be a late comma insight and vendor with Russia but it is even more so a latecomer with Titan vendor when it comes when it comes to China and perhaps one additional Point um which also relates to to China's role in Russia policy and it's interesting that in the translated documents that you mentioned literally this was made at the point by a Chinese analyst that suddenly over the course of this war European leaders have signed up to seeing China as a player in European in European security I think one else made the point that sort of the the effects of geographical distance have been weak second and that's an interesting and interesting Dynamic that we see um we also saw that all of Schultz praised himself for having reduced Russia's nuclear threats and this is a topic that we see more often sort of the West praising themselves for the success of dealing with India and China and convincing Moscow that it has with you that has to reduce its nuclear threats and I think this might be something of an overestimation again of the ability of the West to influence both China and Russia policy at the moment such a commitment from Child it's not even a commitment such a historical statement from China is very much a petition of of P5 statements that have been made before but it will also not not come cost free and it does not mean that China will give up its ambiguity um towards Russia so I think especially in this room of nuclear policy where at the moment China was able to put position itself is a constructive actor from the perspective of Europeans we might overestimate the successes that we had with China and overestimate the willingness of China to invest its leverage so I think it's too early to praise ourselves for the successful diplomacy that we have conducted with China on Russia in this case Thank You Rihanna uh I definitely want to dig into the impacts of Chinese Russian Partnerships on uh European perspectives on China going forward in a little bit but I want to allow everyone to make their opening statements so I'm hoping we can turn to Tamiko and Mitchell now to esteem China Scholars uh Among Us um to look at how China is reading some of these issues especially following the party Congress the 20th party Congress um and a Xi Jinping emerge it re-emerges on the world stage um Nico I'm going to start with you you've written about this idea of Fortress China recently uh signals of that emerging from the 20th party Congress work report on ideological hardening uh strengthening of Science and Technology self-sufficiency um security above all else can you talk a little bit about what this means in the context of China's International Behavior going forward um and particularly its approach to Europe and how it fits into its foreign strategy yes okay and thanks Lily for having me I'll hand over the difficult part to mature and start with the generic assessment of of China's foreign policy course after the 20s party Congress and um you know in in some ways it's quite simple right the party Congress signaled a continuation of XI jinping's leadership commitment to existing policies in line with what lyanna just said you shouldn't expect a fundamental change of course with regard to Russia policy the paranoia confirmed with regard to U.S leadership internationally the predominance of security has a major concern is not new but it really tops the agenda now in terms of having its dedicated section and the report Etc so all of that I think turns China indeed into a player that has a darkened geopolitical Outlook is feels threatened and doesn't see strategic opportunities as prominent as maybe in the past risks and challenges over everywhere and and with that environment within that environment and Beijing is trying to um change an international order um through its own initiatives and in in that game the European Union and individual member states companies play a dedicated role but a limited role I think um coming out of the party Congress you you would not read a dedicated new shift in China's Euro policy enough to hear what Matthew thinks um but rather a continuity of Trends which is trying to mitigate pressure from the United States a clearer shift towards its own Global initiatives um the global South in particular the region and then securing good relations moving forward with Europe specifically in terms of technology and economic Partnerships I think is is a goal but there's no fundamental new takeaway that I was reading into the party congress with regard to Europe China relations what's clear is I think that the the path for deep and long-term Corporation is narrowing giving the deficit of strategy trust between leaders but as you've pointed out Lily I think rightly so there's a renewed attempt to not just stabilize but invest in the relationship even more than maybe it was the case over the past three to six months over too much well thank you Amigo for this transition and and thanks uh Lily and Max for having me um to what you said Miko Fortress China and and everything else I would say yes but um but what if we were seeing the premises of a Chinese charm offensive towards Europe I think the question really deserves to be asked um not that there is anything substantial coming from China on the real European interests such as weekend Chinese support for Russia or Market access but there is a softening of the tone and there is a resumption of leadership diplomacy um and I think that this is probably enough to unlock some of the pro-china engagement forces in Europe and this is happening to some extent um and we said that of all the things that happened in China in the aftermaths of the party Congress from the G20 Summit to the loosening of the zero coveted measures uh to the to the demonstrations what has sent the strongest signal to Europe that way could be possible or a different app would be possible is the smiling belly next to Joe Biden I think that in terms of effects in Europe This is significant um and I do believe that there is a before and after the belly encounter when it comes to leader diplomacy think of the reign of criticism that fell on Olive Charles not in the U.S but in Europe and media uh for during his visit it's Beijing I think the atmosphere is very different now and the French and Italian leaders seem determined to go so I think there is a unique political momentum for China to try and inject some positive atmosphere in EU China relations um from several reasons but I think the three that deserve attentions are there are currently some cracks in the transatlantic united front under precise issues for which the trade and Technology Council was created such as semiconductor and also industrial policy subsidies for green transformation as part of the inflation reduction act these are decisions that have direct impact on many European corporate interests so China may see an opportunity there and the second one is um and it was very obvious during Chancellor Charles visit to China the rise of anti-decoupling voices in the political discourse in Europe which is ironic to some extent given that what is really happening is not decoupling and in the material that csis translated from Chinese sources it's actually very interesting to read how Chinese experts talk about the anti-decoupling forces in Europe they really see this as for what they are we are not talking about the coupling we are talking about reducing risk we're talking about dressing vulnerabilities we are talking about some degree of diversification in the indo-pacific that's the reality of let's say business ties between Europe and and Asia but there is a political narrative about decoupling and anti-decoupling which China can play to its advantage and then the third factor that may create some sort of momentum I will qualify that after I have finished on that is the um on the one hand the loosening of the zero covered restrictions and on the other hand the Minor Adjustments to the Chinese statement on Ukraine which lyanna had already mentioned um which taken together will really nurture or nourish The Optimist to believe that a return to engagement yield positive results for Europe I am personally very skeptical about those minor language adjustments when it comes to Ukraine um so what would China try to achieve if it was indeed trying to exploit this specific moment in transatlantic relations but also be kind of domestically I would argue some damage control um neutralizing some of the trends that are detrimental to Chinese interests um getting the Europeans to lower their guards and some of the issues that really matter for China in terms of access to investment opportunities etc etc so I would Nuance a little bit what you rightly say Nico as an opening statement thank you Mateo and Nico um that's great I Max I I want to turn to you on the transatlantic front but I'm wondering if I could just follow up with a question for for Miku and me to to begin with actually to everyone um I thought it was really interesting how you talked about um what China might seek to get out of uh what it sees as uh frictions in the transatlantic relationship um and Nico I'm wondering do you have any ideas for what I mean it's clear some of the Chinese Scholars that that uh We've translated pieces from Ducey uh strategic opportunities for China here um one of them and and this was translated prior to the subsidy disputes talked about uh Divergence in the Western Alliance and how that creates opportunities for China what are the what would be the goals and mechanisms by which China would seek to leverage that um tension first of all I think it's it's defensive and to be seen in the broader context of Chinese leaders feeling or at least pretending to feel um encircled and um a new network of Alliance Partnerships being created that fulfills just one purpose which is to keep China down I think that's a deeply rooted belief which over the past three to four years I think was to some extent um fed with reality because indeed some of these new Arrangements have the purpose to deal with China not necessarily keep it down I think that's a paranoid part but um to align with regard to interests and and policies as much as possible among like-minded countries so um the European angle plays into that um but then it's also a an economic reassurance the European market is incredibly important for China in terms of expert opportunities in terms of deep corporate Partnerships um job creation machines that the European companies are in in China so and Technology providers so I I think that's in this slow decoupling world that we live in um securing access to European high-tech will become even more important and as we move forward um and finally it's about legitimacy of China's International poster and their capacity to say that and to point fingers to Washington um that not all of the policies that U.S might pursue vis-a-vis China are shared by the rest of the work so they they're very happy to point out as the European Chinese ambassador to the EU has already done that trolls obviously pursues a different policy um with regard to block building or the framing of democracy versus autocracy so they use Europe also I think in in that sense and to signal that they are not alone and that they are oecd countries important industrialized and economies and democracies that don't pursue the same strategy as watching thank you um you mentioned the uh the importance of Europe as a market and a source of technology for China um Noah and and Miko and me too I'm wondering uh do you see a chance for the the EU China comprehensive agreement on investment to to come back or is that still uh dead going forward I I think we can finally move on from the comprehensive agreement on investment and stop talking about it um uh I think this wasn't even an issue that was raised by uh Sean Michelle uh during his uh visit to Beijing and uh he he was one of the last Defenders uh of this agreement um we have there's no easy way out of the the sanctions uh impasse and in a way I think we've kind of moved uh Beyond this agreement now we're in a sort of you know the if you remember this was done at the very end of 2020 we're now at the end of 2022 two years of uh have gone by and a lot has happened in those in those two years you know we've had the uh the Lithuania case we've had Russia and Russia's invasion of Ukraine and uh so I I don't think the uh I don't think the the environment is right for uh for this for this agreement to be revived at the moment I'm wondering if we can just move to China Russia quickly to become at a point that mature made um you said that you you asked and I think it's an open debate here in Washington as well whether Xi Jinping is emerging from China's coveted lockdowns uh and and launching a charm offensive um in the west and perhaps targeted toward Europe um given the reputational damage that China's No Limits partnership with Russia a caused for China and Europe um is there any chance that she could walk back from this and what would it take I mean we've seen him you know make uh statements in opposition to nuclear weapons in in some of the meetings with European leaders recently um president reconna France has recently said that he sees um you know he sees Xi Jinping as critical um as a mediator in the conflict um perhaps uh mature and then going to lyanna could we um could I ask you uh you know what are the chances that this reputational damage could be walked back and what would it take it's a difficult one I don't believe that the reputational damage can be and down in a short period of time um I think we need to really take the wide view of the whole European continent and not focus only on France and Germany which have very specific approaches to trying to convince him being to reduce the space in which Russia conducts its war against Ukraine and there is much less enthusiasm for such an approach if you go towards the eastern part of the European continent and this is where the damage for China's support for the Russian war against Ukraine has been the strongest and I think that yeah Damage Done to China's reputation in Poland the Baltic states several other countries in the East is not going to be easily undone and certainly not uh through the statement that we have read recently um and even the if you read the French version of the encounter the readout of the encounter between Xi Jinping and macron in Bali there is a mention of France and China being attached to the territorial integrity and the sovereignty of Ukraine which could sound you know not bad as at least reducing the space for from Russia on the on the international scene that this in fact is read as cosmetic adjustments and and nothing really substantial and everyone is watching the the deeds and everyone is wondering about the flights for example uh that are being spotted on Chinese soil so I see this as really something that China is not willing to walk back from uh and despite many attempts actually it started at the April EU China Summit which is in fact a milestone in EU China relations um never was there any EU China Summit for which the difference of approaches was so strong and this was really about Ukraine and the EU wanted to Define Ukraine and as an issue in EU China relations uh and and the Chinese side had no intention to do so and hence the enhance the the leaders talking past each other and I think that's what we have seen since is just cosmetic adjustments with uh with no impact but lion I may disagree with that shift that we see in Europe that and security policy and everything that sort of relates to Nato and so on the Central and Eastern Europeans the nordics have a much more powerful position than they had in the past compared to the position Germany and France had I mean I think that's very much reality I think it is yet unclear how that will spill over into EU policies and into EU approaches because in the year they're just other languages and mechanisms at hand I mean Financial power still lies with Germany and France and not with the Central and Eastern Europeans um but I do think these these Rifts um that you outline but you I think they're very present um and the war has to some extent widened these with between those who closely align with the United States and values and security policies and I still see it and and then my doing my my correct me I still see at least in some of my corn statement this idea that we have uh with the US and with China to Great powers fighting I think in one speech he said to elephants fighting um implying that Europe should not be the the trampled grass to use this quote um and to some extent also Olaf Schultz article in foreign affairs alludes to that when he says well there should not be a return of a new Cold War and that Europe has to find its own independent position in a multi-polar world where multiple actors and models of government compete with each other and I think one can waste many questions I mean first what is what does independent Europe mean in that context and second do we really live in a multi-polar world isn't this rather a world where you know one of the key dividing lines will be um the the relationship with China going forward so I wonder whether there's still this flare of equidistance let me throw at this this word um in some of the views of the views of some in Germany and France which is certainly not the case with Central and Eastern Europeans and then packed together with the IAA and the transatlantic topics that that Max knows more about this reinforces this idea that we have this sort of big fight between the United States and China and at the same time the United States benefits from the war and Europeans are sort of coming out of this conflict that's the losing side into therefore not put all their bets on the United States but keep their relations with China alive and have a third way so that's sort of the the greater narrative which I think can can lead to some divides in in Europe about how how to assess China uh Max I want to turn a transatlantic relations in a minute and uh I'll turn over to you but I wonder if I could just ask one final question on on just uh Europe China relations because um one of our readings looks at uh uh Central and Eastern European countries and their relationship with China and this year we've seen um Mafia and Estonia drop out of the um well what used to be 17 plus one now 14 plus one um some of the uh of the Chinese Scholars um that that the readings uh are from argue that well this cooperation mechanism has been of strategic value for China I think we can all recognize that but they acknowledge that um China may need to boost the value proposition um uh to to these countries of that mechanism going forward um to combat what they what they call the negative impacts of value diplomacy um so I'm just wondering um it perhaps uh Nico and and Noah um Could you um could you tell us do you think that Chinese analysts are reading this right that greater trade and and investment with those countries um by China could turn the tide or because of the geopolitical shifts we've seen over the past year um and and the reputational Damage that really has been the worst in those countries um is that is that door closing I think it's going to be extremely hard to revitalize this original idea as a regional Forum similar to other Regional diplomacy initiatives that China has led across the world and um if you look at governments in Prague or also I think they they have very limited interest in being packaged into such an arrangement again um so as a package I don't think it's it's easy to be revitalized um I do believe that you know similar to other governments and businesses um the offer on the table makes a difference um so country like Hungary or Greece or um Serbia definitely will take incentives as they come along and look at the commercial but also the wider political benefits that they can draw from close alignment with China and the extent to which China will be able to form a coalition through their own diplomatic initiatives that then can again and that's our fear obviously undermine European solidarity and unity I think we have to be um careful in underestimating the capacity of China to come back on that now I don't think it's a it's an immediate reality for the next 12 months or so but this is not that it's not a it's not an end game that has been played there so a you know an alternative version of a sub-national sub-european diplomatic initiative by China that you know will fly by another name or through different channels I think is is not um ruled out and will probably play a role as we move forward Noah what are your thoughts um I I think we've probably talked too much about 16 plus 1 and 17 plus one uh over over the years um China obviously has it's it's its close friends in this uh in this format Hungary Serbia uh to a certain extent to Greece I guess you could put in that category um but the the countries like Poland uh Czech Republic um uh Slovakia Romania have become quite skeptical so I would agree with Mikko that um you know if China comes uh with some big projects uh and some money then of course they're they're gonna talk with China um but I'm skeptical about whether uh about whether that's that's going to happen it hasn't happened I mean if you look at Poland Poland has a huge trade deficit with China it's been moving in the wrong direction not in the right direction um and we had a Chinese the new Chinese Envoy to Central and Eastern Europe passed through uh passing through the region uh recently met uh met with officials in Poland and uh she wanted to get things going again but she really had nothing in her uh in her handbag to offer so um I'm a bit skeptical about whether this uh whether this format is can be sort of revived in the way that to uh you know that it existed uh when it was when it was formed 10 years ago uh I I think it might be dying a sort of a a slow a slow death um uh although of course you know countries like countries like Hungary and Serbia will continue to maintain very close ties with China and we've seen the big catl investment in Hungary um you know uh whether that would have happened with or without a 14 plus one I I probably would have so I'll stop there great um so we should definitely moved on to transatlantic relations now uh Max and at the recent us you Dialogue on China um Stefano and Wendy Sherman expressed uh very strong convergence um between EU and U.S perceptions on China and suggested that we're at a place where we can actually start discussing joint action the specifics of joint action but there do appear to be some frictions that don't directly relate to China and this relationship that have popped up recently um including the EB subsidies in that inflation reduction act as one example recent unilateral export controls from the U.S um water sitting in Washington looking at the transatlantic relationship what are your assessments of these frictions and then we can go to our European colleagues right well well firstly let me thank you it's been great working with you and thank you for for doing uh the heavy lifting and moderating this panel and organizing and it's great to work with you and be here with everyone else um I I have a a different take on the inflation reduction act which I think it's actually we're going to look back and say this is what saved transatlantic relations because I think if you do a counter factual and say let's just assume Joe manchin did not change his mind and come back to the table uh and there was no U.S climate legislation Republicans take the house there's no climate legislation in the next two years and likely for the next decade because uh the Senate map in 2024 looks terrible for for Democrats and it's going to be a democratic Administration that was going to push climate legislation so Democrats have to control both three branches this was the once in a decade opportunity now imagine if the United States hadn't taken massive climate action what would U.S uh EU relations look like in five years from now and I think this would have been a major wedge opportunity for China uh I think it's no wonder that you know if we look back when China announced it's 2060 uh carbon neutrality goals it was in the September of 2020 uh and I think this would have been an area where there had been rising anti-americanism for the lack of action on climate in Europe uh China would have been playing sort of the good cop to America's bad cop especially during potentially uh Republican administrations um so I I think where we are now is that Europeans are essentially in shock the United States didn't just take action but took incredibly strong action one that is going to be I think incredibly transformative uh and I think the that the only reaction from the EU that will eventually emerge is that the EU will also have to up its game because I think what will happen is that America which is not that far behind in Europe and in many of the the uh markers of of the queen energy transition if you look at uh expansion of solar and Adoption of EVS all of that can be dramatically accelerated and the us is going to really develop a clean energy uh industry and infrastructure which European companies are frankly going to benefit from but that will mean that though is a real need for the US and EU to develop this climate club that has been talked about and I think to really uh take the TTC the training Technology Council and actually turn it into something real we see indications of that with a potential green steel deal between the US and EU which frankly is about China it's about the US and EU making their steel cleaner and Chinese steel is very uh carbon intensive which would be mean tariffs against China so I think this is going to eventually be a real point of strength in the US EU relationship the fact that America is taking climate now incredibly seriously and is acting um but we're you know Europe is sort of going through bizarre stages of grief because Europe doesn't have a fiscal union doesn't have a fiscal policy and and we do uh and I think there will be need for strong European fiscal action which is what macron is really pushing for when he came here in December so I I think that what we've done is sort of neutralized I think climate as an issue that was going to really uh uh right now it looks divisive in the transatlantic coins but I think it was going to be really a potential wedge uh in between cooperation between the US and Europe uh over China but maybe that's often optimistic our other participants as optimistic please Miko and lyanna well look uh I appreciate the optimism I think that's uh that's important um but I find it a bit of a euphemistic spin honestly on that you know you can do climate policy without necessarily violating wjo rules I mean that's at least the interpretation I think that European would Europeans would put forward I think you're right about the the impetus for um further um industrial policy which will be the result of it um and I'm still somewhat optimistic that with the implementation rules um we might resolve at least you know maybe the key part which will be about batteries um at the end of the day um so that's all good but um um don't understand this mate I think so the stages of grief I think is a nice Theory here but you know it's it's a math massive bomb and it's not just you know we can we can be happy about um the climate transition being kick-started now in the US absolutely but again you know there's European partners that you either value don't value so um at this stage I I think it's a massive harm it it creates a lot of disunity um and you know if you say Europeans just don't get it well then maybe it should have been explained better before um and maybe there could have been Bridges to avoid avoid these frictions that have now emerged and they are serious right and it's not just a French um so the walkout by um as a European commissioner I think um is is important from TTC but it's there's a lot of discontent across government officials um companies are less worried about it because they will benefit from the subsidies partly at least um so that's that's an interesting Dynamic that we should recognize but I think we're making it too easy to just say um uh deal with it and it's a better deal that you get now maybe I can just add one word uh I think it's not happening in a vacuum right uh it's happening at a time when the European economy is really suffering and companies here in Germany are going public with plans to to reduce investment here I think a lot of energy intensive companies in Germany are uh are really struggling uh you know middle stunt companies on the brink of bankruptcy that kind of thing so uh so it's another it's it's sort of the the the the drop that led the the bucket to overflow I'm talking in German now but um uh but yes yeah so so I think I think it's not just the IRA that is that is uh is triggering this this uh this huge backlash in Europe Liana I know you had comments itself have been quite critical of my cons flaming when he was here in DC and I feel a little bit between two stools here about saying this risks of augmentation of the Whisk of the West which I think is against the backdrop of a war in Europe which basically the United States is the only reason that Ukraine are the main reason that Ukraine is still there and that is providing leadership here in this War I think marcon's drama was a bit too much and I think it was a bit too much also for Germans who really didn't want to see a trade war with the United States they want to fix it um and not to you know uh get into serious transatlantic trouble um and I think the most important aspect here probably is that the IAA was never intended sort of intentionally against Europeans right I mean I think Europeans were just and you correct me Max I think Europeans were just overlooked it was a policy process where at some point someone woke up and was like oh have we asked what this means for Europeans and then suddenly it all blew up but it was never meant and it was probably um just overlooked in the process because I've amend s aside there's a problem for for Europeans and I think biting statements made this quite clear so I think this should be a drama episode that we should get behind us and everyone worse if it was not meant that way I'm not sure like in a relationship if you mean it if you don't mean we saw the same with Arcus right exactly the fact that the Europeans are often collateral damage is a problem in itself but I would still share um to to um I think Max optimism um will only materialize if the Europeans are able to come up with an ambitious set of industrial policies that's the only scenario that is positive for Europe and we are not there yet I think the EU chips act has been the first European attempt to relax uh European rules and competition policy that are extremely strict what we have for Ev is support for Innovation it's not so support for manufacturing so there is an immediate risk to the automotive sector in Europe which also has an impact on the integration between the European informative sectors and the Chinese Automotive sector so there is a triangulation here that that works um the European commission has a set budget until 2027. it's extremely difficult to come up with a package of State 8. there is no there is not the flexibility that the the U.S federal government has um I think that overall what makes me Optimist maybe Against All Odds is the fact that this is the direction in which Europe is going anyway resuming um you know an industrial an approach to Industrial policy um but there are many obstacles before we get there maybe the second point I would make is that The Intercept after the October 7 rules and semiconductors um which also you know come with collateralization uh Dutch interest and and the other European countries that have a semiconductor industry and very interestingly despite all the consultations that are going on between the Europeans and the US on Nano Electronics so sometimes the U.S just um speeds up uh and and everyone has to adjust and and pick up the broken pieces but what is at stake currently between the between the U.S and the Netherlands is really a very very interesting test of uh you know converging uh after a major unilateral decision was taken Max what are your thoughts are you so are you no so I I look I totally get where Europeans are coming from uh you know they're having to decouple from Russian energy they're they're having tremendous inflation that isn't caused by uh by you know inflationary checks uh but by uh decoupling uh and that you know while I think it is I think it is important that this wasn't intentional uh to uh to keep Europe out of the subsidies uh I think you know who knew that we didn't have a free trade agreement with the EU my guess is not a lot of Senate staffers did uh and the way we do legislation is is not is kind of an embarrassment uh and that's all true uh but uh this is ultimately about China uh and there was a choice of whether the United States was just going to basically uh ship government subsidies out to build up a Chinese queen energy industry uh in order to accelerate the transition or not and I do think that you know the complaints about the WTO rules well there are questions about cbam being WTO compliant uh and the WTO was created pre-concerns about climate change and I think in order to really accelerate the transition something like this is going to be needed in Europe and Europe was hitting the bounds of what was possible you know you're not going to shift if you're a household uh your gas fired gas boiled uh radiator for a heat pump unless someone's giving you incentives uh or you're increasing prices which is not going to be possible in the current European environment so to me right now we need to use this moment this current anger Europeans need to reassess where they are and hopefully we can use that to elevate the ambition of the TTC of us EU economic and climate cooperation and I hope it instigates that it might not it might lead to just years of um of complaints and and going EU going to the WTO but uh so that would be bad but I think I still think the alternative of the US not doing anything on climate would ultimately be worse for transatlantic relations in our and uh working together on China well that's a very optimistic uh way to conclude and we have a few minutes left I just wanted to um to to ask our panelists uh very quickly what uh what are your just looking at the year ahead um you know the the the U.S EU tensions that we're seeing right now what are your anticipations about the duration of those the scope of those um and the extent to which they will um they will harm um a greater Unity of purpose when it comes to to China policy and Joint action that has been called for on on both sides at least on a theoretical level um so let's uh I'll just I'll go to matua and then uh Miko Noah and then lyanna and Max I still there is still I think there is still strong transatlantic convergence and a defensive agenda obviously China and we should work on that and for the Europeans it means completing and finishing up all our toolbox of defensive measures um dealing with the easy issue first I mean we need with the US to manage differences on export control uh within Europe we need to show coherence when it comes to screening investment and and addressing investment that comes with excessive leverage or inappropriate access to technology the rules are there but then then there needs to be good enforcement we need to be credible an entire coercion and and this is also a transatlantic agenda this is primarily currently an intra-european agenda but we will need to show credibility and and there is also some some space with the US to build the normative data space that allows trust towards the exchanges so I think this whole defensive agenda visually China is still quite promising to me thank you Mika I fundamentally agree I think there's the overarching trend is still convergence there is um bombs have been dropped on on the desks but um we'll clean up and move on I think China will probably make it easier to for us to converge further I mean that's my Baseline assessment in many ways I I don't see China converging or being successful with its Channel offensive in the next six to 12 months to an extent that it would fundamentally derail the overarching trend loads more like-minded coordination maybe let's include others in that picture I find that very important and then there's a lot of parallelism that will be constructed but I think I mean the investment in of Europe Europe and the United States into the deepening of the partnership with India for instance is a very important Trend um same problem goes for Japan Australia all of that I think will put us overall on a an aligned trajectory hopefully there will not be too many frictions along the way I think the next few weeks and months will be quite critical for both the export control and and the subsidies question so it's a critical moment but not one that will fundamentally derail I think the overarching trend what is there left to say um I I do think we can overcome the the current divisions in the transatlantic relationship I mean the next few weeks will be will be quite interesting to watch we had a major row of Iraq over Afghanistan we had a major route over August we we over overcame these and I think the U.S and Europe have a strong interest in in working together and you can see that in Schultz's Foreign Affairs article even though I think from a U.S perspective they they would have would have liked to probably see uh See more a different language on on China uh what what I'm I mean I do think Europe and Europe and the US are more united now uh uh vis-a-vis China than they have been uh you know ever perhaps certainly in the last five years uh but I think what we're gonna see increasingly going forward is what I would call a sort of urgency Gap uh we're seeing the U.S government uh take measures like export controls I think we're gonna probably see an executive order on outbound investment screening in the first first quarter of next year um I think we'll probably see the U.S looking at Europe uh uh on on on a bit more closely on 5G again returning to this issue given the the lack of progress in in some large European uh german-speaking countries um so I think this this sort of urgency Gap um is going to be an issue the U.S wants to move fast it is worried about National Security uh Europe has this defensive agenda but if you look at what uh what individual countries are doing I think it's it's it's not uh it's it's not a scene in in Washington is moving fast enough yeah I can also conclude an optimistic node I think the transatlantic Alliance had never been stronger I mean I think the war in Ukraine really brought Europe and the United States together in a way that they haven't been for a really long time and I think the crucial point about transatlantic Unity or this Unity will not be China but in the next year will be Ukraine and the question of an ant game in the Ukraine so what kind of end game do we want to see in Ukraine is it the February lines the pre-invasion alliance is it a negotiated agreement is it the Ukraine retaking all of its territory um I think that's going to be a big question in in the next year and then if China offers itself and tries to continue it but you put it the the charm offensive and offers itself as a kind of constructive mediator in in this war what he pretends to do so um that might also have an influence on a European thinking but I think for the moment it's really Divine Ukraine which is uh of the first order priority for Europeans in the next year thank you lyanna for ending on that optimistic note um and I just really want to thank all our panelists are for a very rich and thought-provoking discussion and reflection on the Dynamics of the EU China U.S relationship across the past year and uh prognosis for the year forward um I I want to thank our audience for tuning in uh my co-host Max has had to run to another event he's running um online on the broader transatlantic security implications of greater sino-russian military alignment so if you're looking to continue this conversation please just head right over to that event um and um I I want to plug the interpret project uh one more time we are always looking for interesting thought-provoking articles uh from Chinese Scholars and policy makers to translate so please send us your suggestions uh thank you again to our panelists uh and and everyone uh for for joining us this afternoon this evening um there is a lot to watch for in a year ahead in this relationship and uh we hope to have another event perhaps in six months to reflect on whether some of the prognoses have have come to fruition or not so thank you [Music]