Europe turns to benefit from Chinese green technology – Global Issues

Europeans realize that China’s advantages in emerging green industries and its dominance in green technology supply chains will affect the EU’s ability to implement energy transition documents, and its commitment to addressing the climate crisis has simply not kept up. The United States’ climate action at the international level is less ambitious and more erratic. Europe’s mouthpiece says: Without China, Europe’s green transition is impossible.
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The concept of de-risking was first articulated by European Commission President Ursula von der Leyen in her speech on 30 March 2023; it sets out a new vision for the future of EU-China relations based on three fundamental pillars for reducing the risks facing Europe: defending Europe’s legitimate economic interests; the importance of resolving differences through dialogue and, ultimately, diversifying the EU’s partnerships.
There are several reasons for European leaders to take de-risking measures at the EU leaders’ summit in Brussels at the end of June 2023:
Unrivalled Chinese dominance: EU leaders are aware that China has become dominant in economic sectors related to green transformation and emerging green industries. The Chinese leadership has identified the so-called “new triumvirate” of solar cells, lithium-ion batteries and electric vehicles as important engines of Chinese economic growth, and while this Chinese dominance will benefit Europe’s climate action; Chinese hegemony could threaten Europe’s economic competitiveness, national security, energy security and even the EU’s climate goals.
Concerns about policies of economic coercion: The West accuses the Chinese government of using trade relations as a weapon of economic coercion, suddenly stopping imports, boycotting consumers, banning exports, and erecting more non-tariff barriers.
Concerns about technology leakage: Union leaders see the importance of erecting barriers against so-called “technology leakage.” This means the unauthorized transfer of sensitive technology or BroadCast Unitedlectual property from Europe to China; this would undermine the competitiveness of EU companies in the technology sector.
Europeans therefore see de-risking as a unifying concept to counter China’s coercive economic policies and as a less confrontational and more strategic way to protect Europe’s economic security. At the same time, they find promoting climate considerations as a “panacea” to adopt a positive and cooperative agenda with China.
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The European continent faces three paths on the path of green technology transformation with China’s participation: The first path is to fully trust Chinese companies as the backbone of Europe’s green transformation, while the second path requires a risk-free approach and reduced exposure to China’s green transformation. Exposure to as many technology fields as possible while enhancing substitution capabilities, while the last path is the third path, taking into account the criteria of selectivity and balance when dealing with Chinese companies so that they do not work in areas that undermine European national security. The following are the options that European decision-makers can choose on each track respectively:
• Give Chinese companies full confidence: European policymakers on this path must work towards more flexible policy options, accepting a greater degree of dependence on Chinese products, and they will have the confidence to benefit from lower prices for these products produced for the benefit of European consumers. This will therefore increase the ease and speed of the green transition.
• Lack of confidence in Chinese companies: the de-risking approach on this path will be the most stringent; dealing with Chinese companies in the field of green technologies will be avoided as much as possible, and policymakers will have to use all possible European resources, even at the cost of higher prices for European consumers and even slower achievement of climate change goals.
• The third path: The title of this path’s approach to eliminating risks is: “We don’t trust Chinese companies…but”, which means that Chinese companies cannot be treated without being selective and cautious, and ensuring that the technology field is not related to national or cybersecurity.
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If the Third Way appears to be one of the more balanced and rational alternatives to deal with Chinese green technologies, the criteria for success along this path require EU leaders to do the following:
• European unity of decision-making: EU leaders must fully coordinate the European decision-making process in line with the principle of European strategic independence, which aims to establish European sovereignty, while taking measures to strengthen the EU as a unified geopolitical entity.
• Discipline on rules: Europeans must keep pace with the development of the green technology industry, set their own rules, use their own market power, and generate the political will to reflect a comprehensive and more assertive approach by the EU in dealing with any issues that could lead to economic coercion.
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Arguably, one of the areas that best outlines the future of Beijing-Brussels relations is the solar panels and electric vehicles sector, as follows:
First: Solar panels
A) Risk Assessment: Economic and Political Risks Europe Faces in the Solar Panel Industry From an economic perspective, China is a major player in the global solar PV panel component supply chain, especially since China produces two-thirds of the global solar PV panel components. Global polysilicon supply. Politically, Europe faces a dilemma because China’s Xinjiang province, which produces about 35% of global polysilicon production, has been criticized by international organizations for forced labor and other human rights violations against ethnic minorities in the region; and for colluding with China to buy boycott products, which is embarrassing for Europeans.
b) Seeking a compromise solution: It is important to diversify the sources of EU solar panel imports, a step that would create opportunities for new partnerships with emerging producers in third countries. At the same time, it is necessary to continue to provide huge subsidies to European companies dedicated to the energy sector.
Second: Electric vehicles
A) Risk Assessment: Should Europe continue to be overly dependent on Chinese electric vehicles; The EU faces two extremely dangerous issues: One is in favor of China’s competitiveness, there is no doubt that the low price of Chinese cars, coupled with the rapid improvement of their quality, is a factor that could pose a huge threat to the competition of the European automotive industry. While the second risk reflects the security level; These cars are equipped with an array of sensors that monitor the interior of the car and the area around it. Among them, it is warned that these cars will become a treasure trove of sensitive data that could be transferred from Europe to China.
b) Seek a compromise: Instead of continuing to complain about the high cost of imports from the US and Japan, or restricting themselves to Chinese cars, Europeans can diversify their imports of electric cars and turn their attention to electric car companies in India or Vietnam. It is also important to provide generous subsidies to European electric car manufacturers; produce affordable cars with a price of less than 17,000 euros, trying to at least narrow the price gap with Chinese products.
If the third way is the best option to avoid conflict with China, then the security risks in the electric vehicle sector could extend to surveillance, spying and data theft in Europe, making it difficult to just take a middle path without quickly taking radical solutions to prevent China from meeting Europe’s electric vehicle market ambitions.
In conclusion, are political challenges an obstacle to the implementation of China’s green technology de-risking approach? Getting rid of bottlenecks, including translating the principle of de-risking into actual policies, does not require strong European leadership or consensus, but rather a radical political push to develop a comprehensive European industrial policy, following the footsteps of China and the United States of America. This will be the only solution to strengthen the unity and rejuvenation of the European Union by enjoying the fruits of economic returns from advanced industrial sectors.

Andrew Albert Shockey
Center for Advanced Future Studies
original:
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