The pandemic made tangible the global subordination of several countries to the Asian giant, and the double standards with its main rival and Western ally, the United States.
“The trade war with China doesn’t just affect China and the US, it affects everyone … these kinds of decisions affect the whole world”. This quote from Rodrigo Malmierca Díaz, Cuba’s Minister of Foreign Trade and Investment, highlights a commercial conflict between two such gigantic titans, forcing countries to promote a policy of autonomy. The health crisis exposed a well-known but unpopular debate: the resilience of supply chains and over-reliance on a single supplier, which, like its American nemesis, has internalized geopolitical risks.
A study of the European Think-Tank Network on China (ETNC), ‘Dependence in Europe’s Relations with China. Weighing perceptions and reality’ indicates that this submission is being considered mainly at the EU level, and that Spain is taking a pro-European approach to tackling the issue. Years ago, of course, the objective was different, as the emphasis was on bilateral economic relations and on promoting economic exchanges with China to reach the level achieved by other major EU economies, such as France or Germany; as the report reveals.
Chinese economic relations are a recent part of the Spanish public debate, triggered by Chinese purchases of Spanish government debt during the eurozone crisis and revived by the Covid 19 pandemic. In 2012, there was even an informal rejection from the Spanish authorities to the cautious Chinese proposals, which prevented a series of takeovers, including Red Eléctrica de España, CESCE, Repsol and Canal de Isabel II of China Investment Corporation. The think-tank paper says Spain’s reliance on foreign trade from Beijing has manifested itself in two areas since the epidemic that began in 2020: first in medical products and then with the shortages experienced during the economic recovery, including critical semiconductors for the automotive industry, a key sector of the Spanish economy. National supply chains are trying to maintain their ties with China’s key strategic partners.
The report ensures that through strategic dependencies China is able to have a significant impact on the global availability in Spain of some twenty goods, i.e. goods with critical applications in critical infrastructures, industries and central technologies of the fourth industrial revolution (pharmaceuticals, raw materials and electronic components). The favorable position of the Chinese market does not apply to all imports to Spain. “With the exception of agricultural products, China remains a secondary export market compared to Spain’s traditional partners in the EU, the US and the UK,” they said. insure ETNC.
There are two particularities with regard to commercial agreements: first, that the White House’s status as an indispensable ally, and their enmity with the Easterners, forces like-minded nations to oppose Beijing. “From 1999 to 2011, the growth of imports from China cost the United States about 2.4 million jobs,” says an MIT document in 2016. The crusade against the Asian country was led by former President Donald Trump, “China is our enemy, she wants to destroy us,” the businessman tweeted in 2011. The change of president and party, along with Russia’s leading role in the Ukrainian conflict, has eased criticism from the US administration.
Second is the fact that China is seen as a less reliable and trustworthy partner than Spain’s traditional partners. The story of dependence is mainly due to changing perceptions and emerging distrust of China. Of course, Xi Jinping’s government is not seen as a threat in all contexts. In fact, Spain’s most recent Foreign Action Strategy and the statements of José Manuel Albares Bueno and Arancha González Laya, his predecessor, recognize that China’s action is “critical” to climate change, given its contribution to greenhouse gas emissions.
While the debate gained relevance after the pandemic, the idea of reliance on China remains marginal in Spanish public debate, with the exception of Vox, which has spoken out strongly against these trade relations. Spain’s position in this conflict goes hand in hand with that of Brussels. From the ETNC, they believe that Spain’s dependence on China is mainly framed at the EU level, raising concerns about “vulnerability” and the “huge reliance of the EU on very limited sources of supply” and calls for European strategic autonomy against the major supply powers such as Russia and the US. In the short term, this is unlikely to lead to radical changes for Spain’s supply chains, be it major relocations or rapid diversification. Spanish support for EU-level initiatives in favor of strategic autonomy may be a more immediate and tangible response, especially in strategic sectors such as healthcare or the digital economy, and in areas where European industry can gain a global competitive advantage.
Source: La Verdad
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