Davos, Switzerland | German Chancellor Angela Merkel has signalled that the European Union may diverge from its NATO ally, the United States, in its approach to the rise of China as a geopolitical heavyweight, opening up a potential split among Western states.
“From a social point of view, from a political point of view, we have this very close partnership with the United States; but sometimes, for economic reasons, we may well pursue our policies in a different way,” she said during her keynote address at the Davos forum on Thursday (Friday AEDT).
Dr Merkel said she’d convene an EU-China leaders’ summit in September in the German town of Leipzig, as part of a bid to increase European influence and have the continent “speak with a stronger and clearer voice”.
The German chancellor has made no secret of her desire to increase Europe’s political heft and strategic independence, but her Davos speech was more explicit in taking China as an emblem of this distancing from Washington.
And her words temper what had been an increasing drumbeat of concern in Brussels and some of the larger European capitals last year about the economic and security implications of China’s rise.
She pushed back against the Trump administration’s hard line against Chinese technology, saying there could be room for companies like state-owned telco Huawei in Germany’s 5G mobile network.
All you’re doing is increasing the transaction costs for everybody if you completely separate.
— Microsoft CEO Satya Nadella on US-China tech decoupling
“We Europeans must be wisely reflecting how we can deal in this digital age with Chinese products and offerings, and weigh very carefully whether we wish to decouple ourselves from the Chinese value chain,” she said.
Germany had been able to counter previous espionage threats, she said, and could likely cope with the security risks of Huawei.
“I don’t think I can assure the security of the system if I completely exclude certain bidders … and I don’t know what these people are able to do, have developed.”
Europe is far too slow. This is something we need to overcome otherwise we will not be a geopolitical force to be reckoned with.
— German Chancellor Angela Merkel
The EU is expected to issue guidance to member states next week on how to deal with foreign vendors of technology that may pose national security risks.
Dr Merkel’s speech was the most forceful articulation of an underlying European attitude to China, which tends to give commercial and trade opportunities a much greater weight in the balance between economics and security.
The German chancellor’s push for a deeper engagement with China rests on her fierce desire to see Europe play a strategic, geopolitical role commensurate with its economic clout – gaining “an equal footing” with the US and China, as she put it.
“We are very much dependent on other players, and regaining a certain sovereignty, a certain independence and self-sufficiency, and having certain basic capabilities, these are legitimate aspirations for a continent that wants to be leading,” she said.
“Europe is good but Europe is far too slow … This is something that we need to overcome otherwise we will not be a geopolitical force to be reckoned with.”
But Dr Merkel’s ‘Make Europe Great Again’ mantra is not the unilateralist creed of Mr Trump. She urged faster, firmer, coordinated action on climate change, and she spiritedly defended multilateral system.
“We will stand up for multilateralism and multilateral organisations. The most effective way to create global prosperity is the multilateral way,” she said.
The meeting of corporate, political and civil society leaders at Davos has been strongly focused this year on the decoupling of China and the US, particularly in the tech sphere.
“All you’re doing is increasing the transaction costs for everybody if you completely separate,” Microsoft CEO Satya Nadella told a Bloomberg-hosted event at Davos. “All we are doing is sacrificing global economic growth, which is not exactly, I think, what any of us want.”