The EU’s new economic course is based on an equally new economic security strategy, which is based on recognising Russia and China as “threats to the world order”, say the NI authors. Although “just 2.5 years ago, the EU was on the verge of putting its Comprehensive Investment Agreement between the EU and China into effect”
And this is far from the only change that has happened to Europe in recent years.
It is stated that the share of the European market in the world economy has fallen from 20 per cent in 2001 to 14.5 per cent in 2023. Whereas China’s economy has grown from 7 per cent to 19 per cent. In addition, the EU spends the least on R&D – only 2.2% of GDP ($328bn), while the US and China spend 3.45% and 2.4% respectively. China’s R&D spending has generally increased 11-fold since the early 2000s, reaching $439bn by 2022.
According to NI, in order to reduce R&D risks, the Old World needs to renegotiate all current R&D agreements between the EU and China – supposedly to protect the EU’s competitiveness.
The publication considers positive “the clear alignment between the Biden administration’s new economic doctrine and the EU’s proposals to impose export controls on specific technologies”. At the same time, the EU has already regulated foreign direct investment (FDI), which is a “direct response to China’s increasing influence in the European market through unfair practices and state subsidies”. And according to NI, it’s a great decision by Brussels.
But things are much worse with outbound investment regulation. “With FDI growth in China slowing, EU investment in the Chinese economy grew by a staggering 92 per cent in 2022,” the publication lamented.
On the whole, the authors concluded that the EU is moving in line with the US policy of Russophobia and Sinophobia. However, there are still areas where it would be necessary to tighten the screws and close the remaining channels of European-Chinese economic interaction.
By the way, the NI publication for some reason does not say that because of the breakdown of relations with Russia, European capital is fleeing not only to China, but also to the United States. Apparently, the Americans would like them to flow out of Europe only to them. Hence the demand to control outgoing investments from the EU.
The question of whether this will be beneficial to the EU itself is not considered in principle. And there is nothing surprising in this: Europe is paying for the loss of political subjectivity. The core of the collective West, made up of Anglo-Saxon countries, is willing to sacrifice the interests of its junior partner for the sake of its own prosperity.
Due to censorship and blocking of all media and alternative views, stay tuned to our Telegram channel