China and the Belt and Road Initiative

The PRC and the EU are two of the world’s largest economic superpowers, with their mutual relationship and the balance of power between them having a profound impact on regional and global economic prosperity. In recent years, China has become increasingly assertive on the global arena, with initiatives such as the BRI, CM2025 and the founding of the AIIB promising a new age of Chinese global economic dominance. These initiatives are not only highly relevant for China-EU relations, but do also shape relations between EU member states, especially between Western Europe with its Eastern and Southeast European neighbours, but also between the EU and third countries, particularly on the African continent. This chapter presents a comparative inquiry into how different identity narratives in China and the EU are at the core of explaining strategic differences in economic diplomacy, both towards one another and third countries. The different identity models we have assigned to the EU and China, respectively, are the “rule-based transformer” versus the “strategic modernizer”. We argue that scope and limits of both China’s and the EU’s economic ambition and priorities can be understood from the identity narratives that are underpinning their different systems. The conditions for which potential “reciprocity” and a “win–win” cooperation in China–EU relations will be explored via these different systems, and whether diverging identity narratives necessarily will set the EU and China on a path of estrangement and disengagement.

This chapter analyses European Union-China trade relations in the context of the current negotiations for a new comprehensive framework agreement between the European Union (EU) and the People’s Republic of China. China is a strong economic power with increasingly sophisticated production in its coastal regions and is attempting to establish itself as a gravity centre by concluding many bilateral free-trade agreements in the region. Although China has a strong hold in the Far East, there may be specific policy areas in which China’s influence ends up being global. The chapter consolidates China’s relations with the European Union, addressing the main arguments that were considered during the ratification process of the Treaty of Lisbon. It examines the mechanisms behind the initiative that provided for a permanent president of the European Council and a single foreign affairs post for the entire EU, which facilitated the EU’s coherence in its external affairs. Moreover, the chapter concludes that the European Commission should negotiate the prospective Partnership and Cooperation Agreement between the EU and China more constructively, without patronizing, and instead accept China as an equal player in the current multipolar framework of global economic governance.

According to Carr, ‘Every political judgement helps to modify the facts on which it is passed’. This paper seeks to explore this proposition by following Xi’s actions throughout his past seven years, addressing the change in his agenda from that of internal political stabilisation, to global foreign policy. By understanding the implications of the ‘Chinese Way’, the transformations which were spurred on by the surge in Sinocentrism will be analysed in line with the developments in Chinese regional strategy. The Anglo-American approach towards the ongoing process of Sinification has since approached a critical juncture, facilitated by the increasing fractures in the global power balance. As such, the role and likely success of the BRI initiative will ultimately be dependent on the ability of the current Xi administration to realign themselves among the existing strategic networks. The projected complications brought on by the growing reluctance to comply with China-led objectives will again be evaluated to discern the future efficacy of the OROB.

This chapter provides a dynamic view of Chinese overseas direct investment in the form of cross-border mergers and acquisitions (M&As) in Europe before and after the inception of the One Belt One Road Initiative (BRI). We analysed that the number and value of China’s merger deals in Europe increased rapidly in 2014−16, but declined in 2017−18. Comparatively speaking, the decline in the BRI-member European Union (EU) countries was smaller than in the non-BRI-member EU countries. We further examine a series of M&A characteristics, finding that the BRI in practice helped to slow down the occurrences of incomplete deals and hostile acquisitions, facilitating instead-incremental acquisitions, majority-stake acquisitions, and non-state-owned enterprise (non-SOE) acquisitions. Our findings suggest a significant change in the pattern of Chinese cross-border M&As around 2017 following the growing suspicions and wariness of Europe toward the expanding presence of Chinese capital in Europe. Such practices will be addressed in line with the changing global attitudes towards China-led economic objectives, evaluating the potential for future pan-European strategic collaborations.

One of the most remarkable economic ascents in the world’s modern history is widely-recognized to be China’s. In the recent over forty years, capitalizing on the favourable global trends of economic liberalization and globalization, drawing lessons from the other countries’ development praxis and devising its own tailor-made domestic policies, this 1.4 billion inhabitants nation managed a spectacular catching-up process, transiting from isolation to wide integration into the global economy and making a stunning leap from poverty and famine to wellbeing, from the lowest international rankings to their top and from the world’s periphery to its forefront. Within this narrow time-frame of about four decades, China became the second largest economy in the world, the world’s leader in manufacturing and international trade, the holder of the largest foreign exchange reserve and the most important actor in many of the global markets. Such tempestuous economic growth, facilitated by policies such as the Belt and Road Initiative (BRI) eventually spiralled into politically-centred objectives aimed at extending Chinese interests abroad. This chapter will therefore examine the various pathways China is taking to progress its economic and political agenda, focusing particularly on the role of the current administration.

Bilateral investment between China and the EU has accelerated rapidly, with both sides seeking a mutually beneficial yet sustainable relationship. Limitations remain however, given that the current legal framework governing EU-China investments are restricted in terms of its regulatory scope. Taken together the fragmented patchwork of investment agreements between the individual EU Member States and China, most of which were concluded back in the 1980s, is in need of a comprehensive review. As such the developments that were facilitated during the EU-China CAI and the US-China BIT will be addressed with consideration of the conflicting perspectives. Given that Europe remains the most favourable destination for Chinese investors, a comprehensive agenda on existing and future investments and access to local markets is critical towards maintaining a progressive economic environment.

In recent years, Russia and China have significantly upgraded their bilateral partnership and started to speak with one voice on many global issues. Moreover, the two states agreed to co-develop their comprehensive visions for Eurasia. This strategic rapprochement comes at a time of growing confrontation between both Moscow and Beijing and the West. As this rift has emerged as one of the underlying trends in the world order dynamics, it is increasingly important to identify the extent to which rivalry with the U.S. and its allies could bring the two powers closer together. This article attempts to take an integrated look at the West’s role in forging and fostering the Russia–China partnership by analyzing the varied set of factors behind the rapprochement and the progress made by the two states bilaterally and multilaterally. Additionally, prospects for even stronger collaboration were assessed. It is argued that Moscow and Beijing’s partnership is driven by geographical proximity, economic complementarity and similar political backgrounds, but tensions with the West accelerated and cemented the rapprochement. While the collaboration trend dominates the relationship, structural difficulties hamper fully tapping its potential. Asymmetry already observed in the partnership may grow against the background of the global crisis, but clear red lines in domestic and international realms will persist for both Moscow and Beijing. Russia is likely to remain focused on preserving its strategic autonomy and diversifying partnerships.

The aim of this chapter is to analyse the unique, complex and globally important relationship between the EU and the People’s Republic of China (PRC) that just marked forty-five years of diplomatic ties.During that period, the relationship between the two biggest global traders underwent different phases, changed contents, aspirations of the two, as well as views of each other, as both sides had gone through substantial internal changes. Chinese initiatives ‘16 + 1’and the Belt and Road Initiative, strategic in nature, boldly stepped into EU soil challenging Brussels economically, politically and geopolitically. ‘Wolf diplomacy’ and ‘mask diplomacy’, together with human rights issues in Xinjiang and Hong Kong that led to mutual sanctions, further eroded relations. How and why EU and PRC arrived at their current position and whether it is realistic to expect a new mutually acceptable cooperation platform to be founded between them. Or, on the contrary, we should be prepared for even harsher misunderstandings and a further distancing of the two to take place. Our reasoning leans towards a hypothesis springs from their substantially different values, history and strategic goals, as well as perceptions of themselves, of each other, and of the global economic and political order. Their mutual misconceptions and misunderstandings, and consequently, disappointments, originate from the same source, as fruitful trade and investment cooperation could not fill that gap.

China emphasises the peaceful character of its development but we witness some areas where we have to answer for concerns. One item of this list is linked to the 16 + 1 framework. The majority of these 16 European countries are failing to manage convergence and lagging behind the most prosperous parts of the EU. This dual-faced European economy offers an opportunity for China to gain strategic economic and political positions in the EU. The overview and the valuation of this cooperation in details and its global relevance will be one of the core pillars of the chapter. Within the 16 + 1 cooperation Hungary may be highlighted for many reasons. The idea of the 16 + 1 was born in Budapest in 2011, one of its main materialised projects is the Budapest-Beograd railway. And furthermore in Hungary there was a growing discussion since 2014 on “Can China set us an example?”, as Professor Kornai formulated it in the title of his paper. To what extent may a European country look on China as a prototype for economic, political governance? The Hungarian experience will be considered as a case study here, addressing its engagement with the Belt and Road Initiative. Ultimately, the discussed insights will be evaluated against Kissinger’s new term: coevolution (On China, 2011). How does the China–EU relationship fit to this theory? How does the 16 + 1 cooperation and its various forms follow that? Such questions will be answered in the concluding sections of the paper.

This chapter considers the evolution of Sino-Italian relations since the founding of the People’s Republic of China in 1949, until today. The chapter will be divided in four sections: an analysis of Sino-Italian relations in the emergence of the Cold War structure in 1950s and 1960s; an account of the development of bilateral relations from the establishment of diplomatic relations in 1970 until the end of the Cold War with a special focus on the ‘golden era’ of Sino-Italian relations in 1980s; and a description of Italy’s failed attempt to consolidate its share in the growing Chinese markets in the post-Cold War era. Finally, a session will be dedicated to the most recent evolution of Sino-Italian relations during Xi Jinping’s leadership, concluding with a set of policy prescriptions for a reassessment of Italy’s China policy in the framework of the so called ‘New’ Cold War.

This chapter presents the evolution of the commercial relations between Italy and China in the last hundred years. After presenting some information on the little known interaction before the Second World War and the slow and politically sensitive start of trade relations with the People’s Republic of China, it analyses the evolution of bilateral trade and direct investments after 1978, subdivided into three periods characterised by a different economic environment and character in international relations. The consequences of this evolution are seen both on the trend of bilateral trade and on the effect that China’s growth had on the competitiveness of Italian companies in the world markets and in their reaction to it. Finally, the immediate impact of Covid-19 is assessed by giving updated information on the trend of bilateral trade in 2020. The growing size and importance of the bilateral trade and particularly of China as source of Italian imports are the most evident aspect that transpires from this analysis. Another important factor that emerges in assessing the evolution of the commercial relations between the two countries is the role that geopolitical forces played and play in shaping it.