Internationale Politikanalyse International Policy Analysis Internationale Politikanalyse International Policy Analysis X Europäische Politik Uwe Wissenbach The EU’s effective multilateralism – but with whom? Functional multilateralism and the rise of China Mai 2007

Europäische Politik (05/2007) Uwe Wissenbach The EU’s effective multilateralism – but with whom? Functional multilateralism and the rise of China 2 Content Part 1: A new strategy of multilateralism for the EU. The global agenda: Drivers of change require an innovative European response............ 2 The need for a new type of EU response: Tackling the global agenda through functional multilateralism ........................................................... 3 A European strategy on the drivers of change............ 3 The EU should brace itself for that global role by focusing on three priorities:................................... 4 Is the EU an attractive model?................................... 4 Part 2: China as a partner in multilateralism?...... 5 China’s foreign policy – from independence to interdependence, but short of integration ................. 6 What have been the main features of China's peaceful rise? ................................................ 7 Sore spots of China’s foreign policy: The Taiwan question and China’s unholy alliances ..... 8 China’s domestic agenda: anchors for functional multilateralism ........................................ 10 The Chinese dilemma of the EU............................... 10 Conclusions: the way forward.................................. 11 Strategic objectives and expected results.................. 12 Bibliography.......................................................... 14 Documents and reports........................................ 15 Sources in Chinese................................................ 16 Summary.………………………………………backside ISBN 978-3-89892-694-2 Herausgeber: Internationale Politikanalyse Friedrich-Ebert-Stiftung D – 10785 Berlin Internet: www.fes.de/ internationalepolitik E-Mail: Christian.Kellermann@fes.de

Internationale Politikanalyse International Policy Analysis Uwe Wissenbach* The EU’s effective multilateralism – but with whom? Functional multilateralism and the rise of China The EU's security strategy * is built around effective multilateralism 1 . But the EU cannot be multilateralist petitor, an oil-thirsty new kid on the block, a supplier of arms to crisis regions 4 and a supporter of authoritaralone. Currently, it seems difficult to find partners for ian regimes in Africa and elsewhere. China is a key primultilateralism: US unilateralism has been steadily increasing since the end of the Cold War 2 . Russia is leaving the West 3 , rebuilding its near abroad and using its ority for US policy makers, as it is seen with varying degrees of antipathy as a challenger of US hegemony, but also a crucial partner to achieve US policy objecoil, gas and currency reserves for imperial diplomacy; tives. Similarly, Chinese policy makers tend to see the UN Security Council reform has stalled; the WTO is in world through the prism of their relationship with the crisis over the failure to agree on the Doha Round; a US, less because they want to, but because they have rising China is antagonising the US and Japan which are responding with reflexes acquired during the Cold to. To a certain extent, the EU is also a pawn on the strategic chessboards of the two players 5 and thus War. Africa, Latin America and Central Asia have beneeds to grow into being a more pro-active player. come platforms for new scrambles and Great Games In this situation, seemingly dominated by realist powith oil and other resources as the prize. The Middle sitions, does the EU's key foreign policy concept still East is deeper in crisis than ever. Economic and political make sense? Besides the geopolitical challenges effecnationalism is on the rise everywhere, including among tive multilateralism seems to suffer from institutional EU Member States. shortcomings: China is perceived as a challenge to the liberal democracy mainstream, as an economic and social com1. Despite a number of successes and many improvements over the years, EU foreign policy is not as co* Principal Aministrator European Commission, Directorate-General for Development 1 As outlined in the European Security Strategy, adopted by the hesive, effective and rapid as that of a state actor. 2. In the current multilateral system, with the exception of the WTO, the EU plays a peripheral role, as it European Council in December 2003. The Declaration of European Identity, which marks the beginning of European Political Cooperation, at the Copenhagen European summit 1973, makes interesting contrasting reading to the ESS. The EU has taken a major step forward from its earlier ambition to be nothing else than a civilian power. 2 As the US is the only remaining superpower it follows, and increasingly so since 11 September 2001, an imperial logic in its dealings with the world which in its most pointed expression was embodied by the US President’s 2002 State of the Union speech in which he said that who is not with us is is the(large) Member States which steer these organisations. While this leads to a strong representation of Europeans in these institutions, that representation does not reflect their unity 6 . 3. The ESS offers no concept for effective multilateralism in relation to Asia and the rising powers there, they are merely mentioned and it is time to fill that strategic gap. against us and his classification of a number of countries as evil or rogue states. But this is only a paroxysm of a more Despite these challenges there is no serious alternative general trend, preceding the Bush administration, of unilateralism which finds expression not only in various foreign policy developments, but also in the refusal of the US to subject itfor the EU, but to develop the strategy of effective multilateralism further. An internal reorganisation of self to international law and norms. The US is not only refusing to sign or ratify a large number of international treaties and conventions, but it mostly ratifies them with conditions 4 Amnesty International(2006) and has a general reserve that international law is inferior to 5 It is in this vein that China offered a strategic partnership to its Constitution and can thus not be used in American Courts EU leaders in 2003. unless Congress votes a law to that effect(which it is very re6 Currently the US is pushing for an increase of voting rights for luctant to do). Thus, for example, while the US has ratified the China and other Asian countries in the Bretton Woods InstituUN Covenant on political and civil rights, this Convention is tions at the expense of European votes; although the comwithout legal effect in the US. For a profound analysis of the bined weight of Europe is roughly in line with its weight in changing, yet classical concepts of Empire, see Muenkler (2005). economic terms, some individual European countries are ei1 ther under- or overrepresented, complicating the negotia3 Trenin(2006). tions.

Uwe Wissenbach The EU’s effective multilateralism – but with whom? Functional multilateralism and the rise of China Europäische Politik (05/2007) 2 the EU's policy making procedures and external repre- successfully. Globalisation is a major driver of global sentation is necessary and long overdue. This topic on governance and institutionally shared responsibilities. which much has been written will not be the focus of Second, globalisation has led to fragmentation. Gethis essay, however 7 . It addresses the strategic gap in ography got the better of ideology, countries are no the ESS regarding the rise of China, which requires a longer predictably divided into camps or united in nonqualitatively new response, embedded in an analysis of alignment, but pursue their national interests and are the global drivers of change. China is now a compulsory reference for Europe's international relations creating strategic spaces for themselves. In the worst cases, states degenerate or fail 9 . Established norms strategy. A strategic focus, nearly as important as the may be losing their global binding force: multilateral transatlantic one, on China and Asia is crucial for the organisations have shown little ability to address the EU's international positions in many policy areas and new challenges adequately. Incremental reform has will shape the EU's role as a global player. prompted a crisis of multilateralism and a renaissance of power politics and realism, underpinned by the diversity of cultures and civilisations that provide protecPart 1: A new strategy of multilateralism tive identities against the forces of globalisation. for the EU Third, because of the spectacular terrorist strikes against liberal democracy and the no less spectacular The global agenda: Drivers of change require an decision of the US to fight terrorism with military interinnovative European response vention abroad, the world has become more challenging at many levels: The world is no longer the same Atlantic one which dominated world affairs in the second half of the • governments need to address non-traditional twentieth century: China, twenty years ago a poor, threats to security such as environmental degradainward-looking country, has become not only a global tion, increased resource consumption, migration, player, but also a driver of global change because of its size, rapid economic growth 8 and active role in world disease, international terrorism and crime 10 • individuals feel insecure because of the effects of politics. India is another global player in-waiting. globalisation on their lives and prospects 11 Europe's transatlantic partner, the US, has an increas• failing states show that weakness can beget ingly transpacific focus and – as US opposition to the strength(as havens for terrorists and criminals) lifting of the EU arms embargo against China has • the gold standard currency of power, military might, shown – this focus can be more important than transhas become diluted as it is no longer a monopoly of atlantic relations. the state and has not proven effective on its own to International politics has changed dramatically since ensure security or for solving crises in a sustainable the end of the Cold War. Three major drivers of chanmanner ge have profoundly altered the strategic picture: • economic power is no longer fully controlled by First, globalisation is a formidable destabilising force states, but largely in the hands of transnational or that has contributed to the collapse of the USSR, the global companies and financial markets, the size, rise of new economic powers, huge shifts in trade mobility and anonymity of which make them parflows, the international division of labour and competiticularly powerful and unaccountable. tion and new social and economic divides. Yet globalisation has also brought new opportunities for develAs a result, almost every international problem has beopment, trade and communication, which countries come a security issue of a transnational nature and difsuch as China and India, but also the EU, have seized ficult to tackle within an international system based on states with their borders and power monopolies. Uni7 Sometimes, provided there is general agreement, the EU can be more effective as different Member States and the Comlateral, often ill-conceived, US responses have dominated the global agenda since 2001, but have not mission can play different roles and use a variety of means(a mix of classical diplomacy, trade, aid, cooperation) or work 9 Hippler(2005: pp. 3–5); Schneckener(2005 pp. 26–31); Hein with different partners to achieve outcomes that would be (2005 pp. 6–11). beyond reach for a single country. 8 China is 1 st in population, boasts the world’s 4 th biggest GDP (in USD terms, 2 nd in PPP terms), the biggest foreign exchange reserves and is the 3 rd biggest trading nation, with key imbal10 A Human Security Doctrine for Europe. The Barcelona Report of the Study Group on Europe's Security Capabilities. Barcelona, 15 September 2004. 11 Commission on Human Security: Human Security Now. Proances in both volume and regional distribution of trade. tecting and Empowering People. 1 May 2003.

Internationale Politikanalyse International Policy Analysis proven particularly effective in reaching strategic objec- many countries are not receptive, not least because of tives. the West's failure to take on board developing counDevelopment policy has gained in importance as an tries' concerns in areas such as development, trade, instrument for tackling the new challenges, but it is environment, energy consumption and, more broadly, itself under pressure because of its often modest re- nation-building. In the long run and through the spillsults which pale against the spectacular development over the new multilateralism may well supersede or successes in China and other Asian countries which modify the old institutions of multilateralism as we have taken place largely outside the Western develop- know them today, possibly on the basis of regional difment policy agenda. ferentiation. For instance, Asia's limited attempts at In short, it seems that the new post-Cold War world integration are taking place in a much looser, pragorder was short lived, a mere decade, and that the matic, process-focused and informal setting than the new century, which opened so dramatically, has to EU's, with a strong respect for sovereignty and nationsearch for new institutional responses to the new chal- building. African attempts, even though more recently lenges, rather than to rely on the old toolkits created in modelled on the EU, have traditionally stressed soverthe twentieth century. The EU faces the biggest chal- eignty, non-interference and nation-building, but this lenge, as it has placed its bets on multilateralism and is changing through the good governance agenda of the old institutions as the rationale for its global role. NEPAD and AU 13 . On the positive side, its innovative internal organisation The new concept, less focused on institutional aphas made it more than ever an attractive strategic proaches, needs to be more open to the interests of partner and reference model for other regions in their the rising powers and developing countries(China, Inefforts to face the challenges of globalisation through dia and Africa in particular) and integrate common inregional cooperation as well as a possible alternative to terests and pragmatic solutions with a differentiated US hegemony. But can the EU be more than the old set of norms of variable binding strength. The outcome master inspiring a young avant-garde? of the new approach may still be a multilateral world order with criss-crossing transregional cooperation(for example, ASEM, APEC, Asia-Africa partnership), but it The need for a new type of EU response: need not be defined from the start. Incidentally, the Tackling the global agenda through functional concept of multipolarity, based on realist and powermultilateralism policy assumptions to challenge US hegemony, has no place in this framework. For multilateralism to become effective, the EU should, together with partners, identify issues of common interest, make multilateral solutions relevant to partners A European strategy on the drivers of change and involve them in the setting of new norms. To make multilateral approaches attractive and successful, The EU, with its post-imperial stance in world affairs they have to focus on concrete issues and interests and an emerging post-Westphalian foreign policy, 14 rather than on general concepts such as"promoting has to propose alternatives to US policy in its dialogues regional integration" or"multilateral institutions". The with partners in Asia, Russia and even Africa where the term"functional multilateralism" describes this apEU is supporting nascent integration efforts. The stratproach, referring back to the initial concept of Euroegy of functional multilateralism should aim at creating pean integration, 12 that is, creating international coopa more propitious political and security context based eration around issues of variable degrees of common concern with trade-offs and spillovers to other issues with an open-ended integration objective. 13 Van Nieuwkerk(2004 pp. 41–61). 14 This does not mean that sovereignty has become obsolete, At the same time, the term expresses a novel approach to multilateralism different from the generic one developed after 1945 to address a totally different but that it is used and pooled to increase common interests and enlarge space for win–win situations. In a way one could portray the EU as a non-imperial Empire, as it has been able to enlarge and consolidate its periphery. But the difference is world with fewer actors, focused on institution building and born from the spirit of the Atlantic Charter. This Atlantic multilateralism implies a normative tendency to create a new Western world order to which that the 25 members of the club are all equals and pool their sovereignty in order to make policy, so that there is no centreperiphery tension, which is characteristic of empires. The same is not true for the US and its allies, where Washington is the centre and the allies, including EU and NATO members, are peripheral and can be ignored if they do not follow Washington’s line. For a Chinese view on the changes in the West12 Cf. Pollack(2005) for an overview of the different theories. phalian system: Yu, Que(2006) 3

Uwe Wissenbach The EU’s effective multilateralism – but with whom? Functional multilateralism and the rise of China Europäische Politik (05/2007) 4 on dialogue, reconciliation, building of trust, interna- In this context analysts in recent years have resorted to tional law and peaceful resolution of conflicts to allow dichotomies such as“Kantian versus Hobbesian”, sugcommon security(institutionalised or informal) to pro- gesting that this corresponds to a dichotomy of soft ceed hand in hand with common prosperity. The pur- and hard power 16 . Leaving aside that in general intersuit of these objectives implies restraint on the moral national affairs are not black or white, the EU is not a front: a policy focusing on imposing one’s own values soft-spoken idealist or a postmodern 17 benefactor of as a precondition will clash with the values of others the world. It pursues its interests with hard power and always be tainted by double standards. It is more when necessary and it has its own double standards: honest to pursue interests and be grounded in strong values and principles that can be promoted with sub• military: FYROM, Aceh, Congo, Lebanon, arms emtlety and patience, by virtue of example and through bargoes(China, Myanmar) dialogue. • economic: WTO, anti-dumping, sanctions. The EU should brace itself for that global role by focusing on three priorities: 1. A strong EU policy on globalisation, including EU internal reforms, EU international economic policy(beyond trade) 15 and leadership on environment, energy and development policies with partners in the developing world, notably China, India and Africa. 2. The primacy of rules and norms(not necessarily only the EU’s), win–win situations and partnerships to solve conflicts peacefully. 3. Engage strategic partners in building functional multilateralism in areas which are crucial to addressing challenges brought about by globalisation and the tectonic shifts in the world order since the end of the Cold War: – sustainable development, environment, energy and resources – world economic governance, trade and social cohesion – non-traditional security threats and governance. Is the EU an attractive model? The mechanisms of balance of power politics – a European invention to prevent hegemony on its continent – have worked for centuries in Europe, but have led to disastrous wars and – at least from a European point of view – utterly failed in 1914. In pre-twentieth century Asia it was an altogether alien concept. The world of the twenty-first century is ripe to work out a more sophisticated approach to coexistence and cooperation to promote the global goods of peace and prosperity. 15 As outlined by Pisani-Ferry(2005). But the EU's objectives and policy mode transcend nationalism(without replacing it with“Europism”) and the EU has a preference for wielding power(hard or soft) within a framework of norms 18 . The European experience, with all its inconsistencies, is a laboratory for a diverse, complex, but ultimately harmonious new global structure. One could argue that the transformation of the world order began with the creation of an integrated Europe during the 1950s: a quiet revolution that channelled power politics and conflict into a structural end to war. The emergence of new powers with similar traumatic war experiences might allow this revolution to spread, slowly perhaps, but with a human and universal destiny. On these key questions Europe should build its foreign policy project. That is not a question of moral superiority. It is a question of interest and survival, because in a world of conflict and power politics, Europe cannot thrive. Even if the EU is unlikely to be copied, it provides a useful example and inspiration. This is why the EU's internal reforms and economic performance are crucial for the EU's global influence. A prosperous EU which succeeds in organising and influencing its neighbourhood by peaceful means and in such a way as to increase common prosperity and security could be a much more attractive model for Asian countries, not least in their own historic tradition 19 , than the imperial Great Power strategy embodied by the USA. In this context it is useful to remember that Asia is not 16 Kagan(2002). 17 The term was coined by Cooper(2004). 18 For an interesting essay on these issues see Laidi(2005). 19 In China’s more distant past, its empire was organised in terms of political, cultural and economic dominance based less on conquest than on alliances and systems of symbolic and economic tributes, a classic soft empire, to paraphrase Joseph Nye’s concept of soft power. The soft power of Chinese culture has also uniquely forced all its conquerors and invaders to adapt to its culture, except for the brutal occupations in the last two centuries.

Internationale Politikanalyse International Policy Analysis only made up of China, India and Japan, but also a Asia and flooding the world with cheap bras, cars and large number of smaller countries which have little in- manufactures? terest in being dominated by either, nor by the lone China has become a global player which cannot be superpower. It is these small states, the original found- ignored and by its mere(re-)emergence poses a chaling members of ASEAN in particular, which lead the lenge to other countries which have to make room for Asian integration process. Asian leaders recognise that it. The real question is how to achieve productive cosolving territorial conflicts is a necessary precondition operation and to ensure sustainable and harmonious for more cooperation and mutual trust, building security communities and eventually sharing sovereignty 20 . development of the industrialised, emerging and less developed countries in a world structured by principles The EU has a major interest in analysing, supporting of international law, dialogue and shared responsibiliand shaping developments in China and Asia at large ties and resources. In this context China is a key actor: in the desired direction of peaceful cooperation, openness of Asia and prosperity benefiting the region and the global economy. 21 Europe’s strength lies in its ex1. it has a veto in the UN Security Council; 2. its present and projected trade and economic perience of stepping out of its own mould, recognising influence and attraction as an investment and diversity and allowing it to be part of a larger identity business destination are significant; and allowing time to shape an order which does not 3. it competes(quite successfully) with European have a predefined finality. Europeans share resources countries and the US for resources and political and power and formulate policies at different levels influence in Africa and other continents, but on that allow them to better confront the challenges the other hand it is the West's"workbench" in brought by globalisation than within the narrow fraa global value chain; mework of classical inter-state relations. Europe's po4. its role is decisive in global policies to address tential to innovate in international relations is greater areas such as the environment, energy and rethan those analysts who focus on its institutional weaknesses would have us believe 22 . sources; 5. it is the most potent developing country which has successfully developed(global progress on the MDGs is widely due to China) despite rejecPart 2: tion of the Western development agenda and China as a partner in multilateralism? of interference by the international financial inCan China be a partner for the EU’s multilateralism stitutions. It does not belong to the club of liberal democracies(or the“free world”); 23 when it is apparently an authoritarian system, forming 6. its soft power is growing, its films, culture, unholy alliances with international outcasts such as medicine, martial arts and even language are Sudan, Zimbabwe and Myanmar; when its energy di- becoming more popular. plomacy and trade strategies seem to be an onslaught on the EU's Africa policy and an undercutting of the Steering the right course on China is a challenge the Monroe doctrine in Latin America; when it thwarts UN EU needs to take up; it is crucial to devise a truly strareform with the help of its old and new friends in the tegic response which goes beyond the current diplodeveloping world; and when it embarks on dominating matic routine and rejects the simplistic China threat paradigm which does not allow any operational and 20 See the Declaration of ASEAN Concord II(Bali Concord II) of 7.10.2003.http://www.aseansec.org/15159.htm 21 In this logic the argument that the EU is too inward looking loses some of its edge, as the EU’s internal, social and economic reforms define its answer to the challenges of globalisation and their success is a precondition for Europe’s successful external action and influence. A Europe weakened by even less innovative approaches to regional and global challenges. The containment option has not been abandoned by those in the USA(and Japan) who see the USA as an ultimately imperial guarantor of a global balance of power 24 . For Europe in the twenty-first century, containment seems the least adequate policy opglobalisation cannot convincingly advance its agenda, which is constituted around effective governance of globalisation. It is therefore also important not to solely focus on Europe’s de23 While this is more of a problem for the US which makes profence capabilities or CFSP procedures and institutional armoting liberal democracy a priority feature of its national serangements when discussing the EU’s role in the world. curity strategy, the EU certainly quite legitimately makes a dif22 A strengthening of the EU’s foreign policy making powers ference between its relations with other democracies and and implementing procedures would of course be an asset China or other non-democratic countries. and would make implementing functional multilateralism eas24 And Congress more than the White House might become a ier. But it is not an essential prerequisite. champion of containment. 5

Uwe Wissenbach The EU’s effective multilateralism – but with whom? Functional multilateralism and the rise of China Europäische Politik (05/2007) 6 tion to ensure peace and prosperity for the Eurasian and more generally a tendency to increase military continent and to tackle the multitude of global chal- spending in the region 26 . lenges. Through containment the implausible China But globalisation has created – at least for the time threat would become a self-fulfilling prophecy. China being – a conviction among Chinese and Asian leaders is overrated when one views its indicators on a per that there is an agenda beyond the US policy. They capita basis and when account is taken of the low have concluded that accommodating competition productivity of capital, labour, energy use and the within cooperative international frameworks through huge costs in terms of environmental degradation, rerules promoting the common interest might be a betsource consumption and social instability. Besides, for ter – and cheaper – option for promoting one’s own the moment at least, the large majority of China's forinterests and ensuring global influence and status. For eign trade stems from processing by foreign invested a decade East and South East Asia have seen no major companies. inter-state conflicts, unlike South Asia, and there are To assess whether the option of harnessing China tendencies to solve conflicts peacefully and increase to the course of a multilateral world order is feasible, cooperation there too. The Asian agenda includes ecowe need to look at China’s foreign policy, analyse the nomic, environmental and social challenges in the redilemmas on the way and examine the EU’s and Chigion and has translated into more or less binding arna’s potential for global cooperation. rangements. Recently, even calls from ASEAN for domestic reforms in Myanmar have broken the taboo of China’s foreign policy – from independence to interdependence, but short of integration China’s foreign policy transformation from a lone player to a globally engaged member of the international system has only just begun, although its transformation has been very rapid in historical terms with the most radical changes dating back to the turn of the millennium only. Geopolitics has put China in a unique position reflected in its name"the Middle Kingdom". It has 29 neighbours with whom it shares 22,000 km of land borders and more than 18,000 km of sea borders. Four of them are nuclear powers – not counting the US. China's foreign policy is to a large extent a reaction to this situation and the security agenda of the US in Asia, which can be described essentially as a heritage of the Cold War. 25 There is certainly a demand by some states in the region for US security guarantees, which complement the regional soft security arrangements, but the US has not been able or willing to develop an innovative policy in Asia since the end of the Cold War: it continues to try and play the countries there off against each other and has contributed to a subsequent proliferation of nuclear technology and weapons 25 The 2005 Indian–US Civil Nuclear Cooperation Initiative (CNCI), which has yet to be approved by the US Senate, allows US exports of civilian nuclear technology to India, while committing India to assume the responsibilities of a nuclear weapons state. The USA’s engagement with India in this field has raised concerns about the impact on the nuclear nonproliferation regime, in particular on the Nuclear Suppliers Group and the NPT to which India is not a party. 26 China has for about a decade, under the impression of the technological level of the US military capabilities in the Gulf War, been modernising its military, as it fears a US military threat and to build up an offensive capability to respond locally to a Taiwanese independence move. That capacity is aimed to allow China military action at a speed which does not allow the US to intervene pre-emptively. In such a way the offensive capabilities are also meant to prevent any unilateral move by Taiwan, as it cannot rely on impunity for such a move under US military protection. China is also trying to expand its fleet so that it can keep its vital supply lines, notably the Malacca Strait, open for oil transport. Incidentally, Japan’s supply also transits through there, but Japan relies on the US to secure the line, something China is of course reluctant to do given that this would lead to increased dependence on a potentially hostile US. Figures on China’s military build-up are difficult to establish, but growth rates seem to be around 14%. US Defence secretary Rumsfeld has been the leading critic of this build-up, challenging China to give reasons as no one is threatening it. US figures might prompt the world to ask the same question of the US: in 2004 US military spending was 455 billion USD equalling 47% of global military expenditure, 5.5% of US GDP and 1533 USD per capita. China’s was 47 billion USD. According to SIPRI Yearbook 2006 the military expenditure situation in the world is as follows: The process of concentration of military expenditure continued in 2005 with a decreasing number of countries responsible for a growing proportion of spending: the 15 countries with the highest spending now account for 84 per cent of the total. The USA is responsible for 48 per cent of the world total, distantly followed by the UK, France, Japan and China with 4–5 per cent each. China and India, the world’s two emerging economic powers, are demonstrating a sustained increase in their military expenditure and contribute to the growth in world military spending. In absolute terms their current spending is only a fraction of the USA’s. Their increases are largely commensurate with their economic growth. For an analysis of the modernisation and the capabilities of the PLA from 1985 to 2000 cf. Umbach(2000). China's national security doctrine is presented in Xiong(2006).

Internationale Politikanalyse International Policy Analysis non-interference 27 . These developments – quite appropriately summarised as selective multilateralism by some experts 28 – open a strategic space for EU engagement. This window of opportunity needs to be used as long as it remains open. China's policy in Asia may be described as"keep China in, the US out and Japan down". In reality it is more complex, mainly oriented to preserving a currently favourable status quo. But China's foreign policy cannot be seen from a balance-of-power perspective alone. Its complex role needs to be assessed in the context of globalisation and China’s domestic priorities and development challenges which nourish a debate on changes in its foreign policy. China's foreign policy doctrine goes back to the 1950s, notably in the context of the 1955 Bandoeng Conference where China succeeded in setting the developing world's foreign policy agenda for the Cold War around its Five Principles of Peaceful Coexistence 29 . China’s foreign policy after Mao 30 was defined by Deng Xiaoping in the early 1980s as subordinated to the primary objective of economic development in order to become a modern, powerful socialist economy. This hierarchy is still valid today and translates into a strong focus on economic, trade and investment policies for which diplomacy is supposed to create favourable environments. However, Chinese foreign policy is by no means internally cohesive and strong, and while not as disparate as that of the EU with its 25 Member States, it does have problems of coordination to address. Besides the enduring leitmotif of the Five Principles of Peaceful Coexistence, the government’s global priorities are geared to four major 31 , but not always compatible, objectives: 1. a stable international environment for its economic and more recently its social development ("harmonious society") 2. political influence, notably partnership as an equal among the developing world, alliances in international organisations and fora such as the UN and the DDA 3. access to, diversification of and sustained supply of key resources, notably oil and gas and essential minerals and more control of major shipping lanes (Malacca Strait) 4. access to markets for its products and investments. In pursuit of these objectives, China is entering into, but also transforming the international system. A doctrine has been developed as a reaction to US suspicion: China’s peaceful rise 32 . Beijing is convinced that a “peaceful rise” should be welcomed by the West, as it sets out a profoundly status-quo approach in contrast to the violently revisionist approach of Germany or Japan in the early twentieth century. While the peaceful rise concept is an important development, it falls short of Western expectations that China subscribe to a Western agenda 33 . Neither does it reflect the policy changes required to address the transnational challenges brought about by globalisation 34 . The Peaceful Rise strategy is thus an intermediate concept in a longer process of reviewing China's foreign policy doctrine still focused on classical inter-state relations. It mainly serves to counter Chinese threat paradigms. What have been the main features of China's peaceful rise? Besides joining the WTO and a multitude of nonproliferation regimes and international agreements related to the environment, shipping or aviation, China 27 Cf. the opinion piece of a Malaysian MP who chairs the ASEAN inter-parliamentary caucus in: European Voice 7–13 September 2006. 28 Hilpert e.a.(2005) has started on its own initiative(and in most cases concluded) negotiations to settle border and territorial disputes with all its neighbours on its land borders 35 . It 29 These are: mutual respect for sovereignty and territorial integrity; mutual non-aggression; non-interference in each other's 32 Interestingly the concept was first announced at a noninternal affairs; equality and mutual benefit; peaceful coexisgovernmental gathering, the BoAu Forum which is a sort of tence. These principles – at the time innovative, anti-power Asian Davos; Cf also Zheng(2005), Zoellick(op.cit.)."Peaceful politics by a heterogeneous group of countries – are still uprise" actually later officially was toned down to"China's peaheld by China's foreign policy makers, even though some of ceful development road" through a government White Paper, the context is rather antiquated. but the earlier term has stuck as more accurate. 30 For a basic analysis cf. Opitz(2000). Opitz focuses on national 33 For a detailed analysis of China's evolving foreign policy cf. interest and China’s skill at theatrical foreign policy. He preBEPA(2006) pp. 53–74. sents the oscillations of China between the US and USSR and 34 Pang(2006). China’s ability to take advantage of the situation well. 35 The settlement with India is still in its inception, as agreement 31 Taiwan is part of the domestic agenda not foreign policy, but is sought at present on the actual line of control and the de facto China’s foreign policy is also geared to promoting question of Sikkim, the annexation of which by India in 1975 the One China policy and fencing off Taiwan’s diplomacy. was not recognised by China. For Himalayan politics cf. 7

Uwe Wissenbach The EU’s effective multilateralism – but with whom? Functional multilateralism and the rise of China Europäische Politik (05/2007) 8 has initiated the creation of a regional security organi- lack of transparency on policy objectives, military casation for Central Asia, the Shanghai Co-operation Organisation 36 . It has engaged in multilateral economic pabilities and exports, aid flows and, to a lesser extent, trade relations. But there are two more fundamental and political structures in Asia(ASEAN+ 3, East Asia issues: cross-straits relations and China's unholy allisummit, ASEM, and so on) and proposed free trade agreements in the region. 37 The system consists of a ances. web with China at the centre of formal or informal mechanisms tackling issues such as governance, secuSore spots of China’s foreign policy: rity, economic relations, environment, communicable The Taiwan question and China’s unholy alliances diseases, transnational crime and drug trafficking, the priorities depending on the regions concerned. China The Taiwan issue is a potential flashpoint in Asia. It is is hosting the 6-party talks to find a diplomatic solution to the North Korean nuclear problem 38 . It is supporting as much a heritage of the 1945–49 civil war as of Cold War geopolitics and a moral problem: the democratic the African Union, has set up a Forum for China-Africa legitimacy of the Taiwan government versus the interCooperation and its trade with Africa has increased nationally recognised exclusive right of the authoritarexponentially(albeit still at relatively low levels, though ian rulers of the PRC to represent China. Yet, the probenough to make it Africa’s third biggest trading partner) 39 . Similar cooperation fora have been launched for lems of Taiwan(and Tibet), compounded by the historic experience of unequal treaties and occupation, the Arab and Pacific regions. Chinese soldiers and explain China’s insistence on sovereignty, territorial inarmed policemen help the UN keep peace in Haiti, Litegrity and non-interference. That is complicated by beria and many other countries. the US policy on Taiwan which is not very consistent, This is not the behaviour of a revisionist power. as it gives a security guarantee to a territory which it However, in pursuit of its objectives, China has not does not officially recognise. come across as the responsible stakeholder of the international system and therefore its peaceful rise conChina's outreach to developing countries is viewed with suspicion in the US 40 and the EU because China cept has suffered in terms of credibility. This is due to a seems to undermine policies aimed at fostering good governance and privileged trade relations. China is ofMohan(2003 pp. 167–172) and 2003 aÉÅä~ê~íáçå=çå=mêáåÅáJ éäÉë=Ñçê=oÉä~íáçåë=~åÇ=`çãéêÉÜÉåëáîÉ=`ççéÉê~íáçå=_ÉíïÉÉå= íÜÉ=oÉéìÄäáÅ=çÑ=fåÇá~=~åÇ=íÜÉ=mÉçéäÉÛë=oÉéìÄäáÅ=çÑ=`Üáå~ at ten seen as supporting precisely those regimes which the US has singled out as rogue states. Yet, in all those countries, for various reasons – strategic, resources, www.mea.gov.in. With Vietnam China agreed to settle the land border by 2008 while an agreement on the Northern seaborder was reached in 2000. In 2001 China and ASEM agreed to settle border disputes peacefully. 36 The SCO includes Russia, Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan and China itself. India, Iran, Pakistan and Mongolia are observers, Afghanistan is on the way to becoming one. The SCO has taken steps to lend substance to the grouping, which got its informal start a decade ago but was formally historic ties or a mixture of all – China has interests to defend. For instance, as the world's second largest importer of oil 41 China is dependent on Middle East oil and gas 42 , but until very recently it did not have any influence in the global market, which had essentially been carved up by US and European majors. Thus Chinese companies have taken considerable risks(mitilaunched in 2001. A permanent SCO secretariat has been set up in Beijing, and in April 2006, members announced plans for their largest-ever joint military exercises on Russian territory next year, although China refuses to term the grouping a gated by government subsidies) in unstable countries and resorted to dubious practices to secure influence (they are by no means the only ones) or to paying very military alliance. Along with its overarching aim of combating Islamic extremism, the SCO has sought to branch out into new cultural, political, and economic territory, including fighting smuggling and drug trafficking. China and Russia dominate the organization and have used it to further their economic and political priorities in Central Asia, especially in countering Western influence and the presence of American bases in what they consider their traditional sphere of influence. There are annual summits of SCO heads of state. high prices for rights on often unexplored oil or gas fields. Its perceived need to rely only on itself has been reinforced by the US Congress’s decision to block a Chinese investment in Unocoal on the grounds of national security. There are positive signs too: China's cooperation with the EU on the Iran nuclear issue has been rated as 37 Cf Su(2006), BEPA(2006) pp. 58–64. 38 Cf. International Crisis Group: China and North Korea: Comrades Forever? Asia Report No 112 1 February 2006. excellent by European officials. The decision to dispatch a strong peacekeeping contingent to Lebanon is http://www.crisisgroup.org/home/index.cfm?id=3920&1=1 download 2.2.2006 and Milbrodt(2005). 40 Eisenman e.a.(2006). 39 Cf. Kaplinsky e.a(2006), DfID(2005), Alden(2006), Sidiro41 In terms of per capita consumption it is of course far behind. poulos e.a.(2006). 42 Steinhilber(2006).

Internationale Politikanalyse International Policy Analysis another signal that China wants to be politically visible come as a buyer of resources and a“no strings atand active in a region which is of crucial strategic im- tached” partner, China is also feared as a ruthless portance. China is moving into a vacuum that the competitor and destroyer of local industries. As a rerapid erosion of the US as dominant actor in the region sult, anti-dumping measures against China from deis opening up. veloping countries rose dramatically in 2005, promptThe precarious situation in the Middle East is increasing the need for diversification of sources of suping the Chinese to ask how they should react to the challenges of allies and friends 44 . As long as China is ply, and explains the outreach into Africa, from where perceived as a negative force, any attempt to forge a China now imports a large proportion of its oil and strategic partnership based on mutual respect and gas. China’s oil interests materialised in Sudan after trust is unlikely. This problem has already been noted the US had imposed sanctions on Khartoum for its by leading Chinese scholars 45 . support to Iraq in the 1991 Gulf War and Chevron was The above arguments could be summarised in the obliged to sell its oil concessions to Canadian compafollowing five points: nies from where they passed to an Asian consortium. Later the protective role China played for the govern1. China’s policy is driven by national interests and ment in Khartoum during the Darfur crisis led to strong not by any anti-Western international agenda(incriticism of China. On Zimbabwe, the situation is simideed one could also draw up a list of Western unlar. China does not support Western sanctions against holy alliances, too) 46 . Mugabe's regime whose fight for independence China 2. China's stance is not transparent and encourages supported decades ago. Moreover, Zimbabwe has belief in a China threat paradigm. huge platinum reserves; platinum is a component of 3. EU/US policies and sanctions do not work if China hydrogen powered car engines which China has identiseizes the resulting opportunities to asymmetrically fied as one of the ways of solving its air pollution probstrengthen its positions and interests. In some lem. countries good governance in turn constrains ChiNorth Korea is a special case because China is hostnese room to manoeuvre. ing the talks which are supposed to bring a solution to 4. China has become an indispensable partner for the conflict about North Korea’s nuclear policy. China any attempt at global or regional governance, nois also pushing for and financing attempts at economic tably on energy and resources and has key comreforms and opening up. The DPRK is a neighbour of mon interests in sustainable development. It is ulChina, a historical ally and part of a divided country timately in China's own interest to promote stabilover which the US and China were at war in 1950. ity and the predictability of its political and ecoThis"special relationship" has changed dramatically, nomic investments. as shown by China's increasing diplomatic pressure on 5. China has ambiguous positions indicating that its North Korea(for example, in supporting the UN resolustance is still evolving(China skilfully masks its tion criticising missile and nuclear tests) and its advoweaknesses and uses overreactions to its advancacy of Chinese-style opening up and economic retage). form, accompanied by economic aid. Indeed, China's main interest is stability on the Korean peninsula. In fact, while China’s foreign policy is not quite abanIn many other African, Latin American or Asian doning its traditional principles of sovereignty, equality countries, China is not behaving in a particularly repreof states, peaceful coexistence and non-interference, it hensible way, although its dealings with Angola, Nigeis in the middle of an incremental and substantial ria, and Myanmar cast doubt on how China shoulders transformation. That process is not dissimilar to its its international responsibilities. There is a vacuum of domestic transformation, trying to preserve the old good governance in these countries, whereas in others, such as South Africa, China needs to act much more within the bounds of rules and legal frameworks 43 . 44 Lai zi mengyou de maoyi tiaozhan[The trade challenges from our friends and allies]. In: Caijing No 159(10/2006) pp. 88– 91. The paradox of the peaceful rise concept and the more ruthless pursuit of national interests in Africa and elsewhere is striking. In its neighbourhood China is a stabilising factor; in Africa it is polarising opinion: wel45 Zheng(2006) mentions the"development threat" as a new issue the government has to confront, alluding to China's perceived undermining of Western donors' efforts. 46 In this context the NATO intervention in Kosovo circumventing the UN was perceived as a very dangerous precedent by China and many other Asian and African countries. This was 43 Alden(2006) p. 14. made worse by the bombing of the Chinese Embassy in Belgrade during the air strikes against Serbia. 9

Uwe Wissenbach The EU’s effective multilateralism – but with whom? Functional multilateralism and the rise of China 10 with incremental change, but adding new features on bution of wealth and notably its degree of control over an experimental basis, with a potential to transform factors such as labour, land and other strategic rethe traditional principles. This process creates inconsis- sources, but also over lower levels of government, is at Europäische Politik (05/2007) tencies and tensions between different ministries and interest groups in China. stake. China is domestically at a decisive juncture about the future course of reform 49 . China therefore has every reason to engage in security arrangements and to stabilise its neighbourhood China’s domestic agenda: anchors for functional and even the wider global order: its internal developmultilateralism ment, projected to take at least another 20 years to build a moderately well-off society, is its key priority. A In historic terms China is simultaneously tackling three stable and conducive environment, trade and supplies centennial transformations. The first is the transformaof energy and raw materials are thus a key diplomatic tion from an agrarian into an industrial society that priority. Internal challenges leave little room for maEurope made in the nineteenth century accompanied noeuvre to modernise foreign policy more thoroughly, by convulsions, revolutions and war which ultimately as the Chinese leadership does not want to be accused led to universal suffrage and liberal democracy, the of throwing all its heritage overboard. Nevertheless, rule of law and the creation of welfare states. The secthe domestic reform agenda provides many starting ond is the adaptation to globalisation that the EU is points for functionalist multilateral cooperation with also going through at present. The painful repercusthe EU as many issues are contributing to the exacersions for social cohesion are being felt at both ends of bation of global problems(for example, climate the Eurasian continent. In addition, China’s challenge change, energy inefficiency). Functional multilateralism to rein in consumerism so as to make its development would allow China to solve problems with partners sustainable is daunting. Finally, China has to come to such as the EU or ASEAN or others without upsetting grips with its own cultural and social identity vis-à-vis its more traditional foreign policy principles. Western or global influences, a process which has been shaking China's foundations ever since the fall of the Qing dynasty in 1911 was followed by an intellecThe Chinese dilemma of the EU tual rejection of China's own traditions. This process has become acute through the consequences of the Yet such cooperation is difficult for the EU: China’s opening-up policy 47 . and the EU’s views of the world differ at critical juncTo a large extent, WTO entry, although key to win tures: sovereignty, democracy and human rights. China market access globally, was an attempt to make dois a dilemma for the EU, apparently calling for a decimestic economic reform, from a socialist planned sion in terms of a value-based or an interest-based foreconomy to a more liberal, albeit still called socialist, eign policy. Will China divide the Atlantic? The transatmarket economy irreversible through the introduction lantic relationship éÉê= ëÉ does not compel Europe to of the rule of law 48 . These economic reforms have subscribe to all elements of US foreign policy and it is made the country stronger, more open and richer. Yet, not exclusive. The US entertains other partnerships and more recently income disparities, problems of social does not necessarily rank the transatlantic partnership welfare, inefficient resource allocation and environas a top priority. While it is still important, it no longer mental degradation, waste of resources, corruption provides the only platform to define the EU's security, and abuse of rights have erupted dramatically onto the foreign policy and economic interests. The EU needs to nation’s agenda through often violent protests linked build complementary partnerships. Europe need not to environment or health problems, accidents, corrupchoose between the US and China, it should expand tion and unfair dismissals or land seizures. After 30 the strategic space it can use to promote its interests. years of opening up and gradual progress of market The following scenario serves to throw the human principles and the rule of law, China has entered a rights dilemma into a sharp light. China’s army invades phase in which the role of government in the redistriTaiwan after it declared independence during the Beijing Olympics. Beijing is holding democratic Mongolia 47 Cf. Gernet(1988), Cheng(1997). 48 The question of rule of law and rule by law is being intensely hostage and cutting off its vital supplies in the hope of bullying it back into the mainland from which it broke discussed in China, notably in the context of the current drive to transform government. The two terms in Chinese differ in writing, but not in pronunciation. 49 Huang(2006).

Internationale Politikanalyse International Policy Analysis after the Second World War. It is backing Myanmar’s more research on it in Europe will certainly influence electoral fraud and North Korea’s provocations and its arms exports have increased. But China is not facing the discussion on the EU’s dilemma in its relations with China 52 . sanctions from the EU or the US. Instead it has become a member of the G-8 and has been given market economy status by Western leaders who flock to BeiConclusions: the way forward jing to discuss world politics and economic relations in the framework of strategic partnerships. This scenario From the above analysis and assumptions, it is clear is too unlikely to be true. But replace“China” by“Rusthat the thrust of EU policy towards China should be sia”,“Taiwan” by“Chechnya”,“Mongolia” by to energetically reject any notion of containment and “Ukraine” and“Myanmar and North Korea” by“Belaparticipation in construing a China threat and to work rus”, you get an only slightly exaggerated picture of with China on the strategic issues of the twenty-first what China perceives as double standards in Western century on the basis of functional multilateralism and foreign policy. mutual respect. The EU and China should focus strateChina can point to successes in poverty reduction gically on improved global governance. Europe can no (more than 400 million Chinese have been lifted out of longer afford to be in reactive mode on the rise of poverty since the 1980s, accounting for more than 75% of global poverty reduction). 50 Its domestic China. A new picture for the future of EU-China relations needs to be painted. And instead of a pointillist agenda emulates policies the Europeans have pursued picture where the whole vision emerges from unconover recent decades: social security systems, social conected dots, the EU needs a few bold strokes which hesion and more balanced regional development. But make its long-term vision of China instantaneously despite these achievements, for Europeans, the way a visible. This vision needs to address the big issues: country is governed inspires(or fails to inspire) confidence, therefore Beijing needs to recognise that hu1) common interests in the new global challenges man rights are not simply a domestic matter, but also a and drivers of change strategic issue limiting China's soft power. 2) differences in values and fundamental views on Given China’s active role in regional diplomacy in the international system Asia, Africa, the Arab world and the Pacific, China may be on the way to engaging in functional multilateralism in order to be better able to address the challenges of the twenty-first century. China is integrated in a liberal trade order and is surrounded mostly by democracies, and even in Africa meets only limited support for its stance on non-interference 51 . These dynamics make 52 Actually, governance and government reform have been discussed openly for several years both in party and government circles and publicly in think tanks, the media and with foreign parties and governments. There has been significant progress in government reform: the administrative licensing law(2004) and the law on officials(2006) have reined in arbitrary abuses it more likely that China will integrate in the international community as long as it provides the strategic space to realise China’s national interests. Status can of power, the death penalty is(again) subject to review by the Supreme Court and openly discussed as no longer in line with the legal norms of the world. Migrant workers have been given a better legal status together with changes in the only be gained in the club, not as an outsider. And the club’s rules increasingly focus on cooperative modes and good governance to solve global problems. For EU-China cooperation to be successful it is not useful to paper over differences, but neither is it wise to see China through a narrow lens which focuses on human rights violations. Progress of reform and a rehousehold registration systems, the agriculture tax was abolished and school fees are being abolished over the next 3 years, alleviating the financial burden and abuse at the hands of greedy local officials. Limited progress in codification and development of law is not enough, though. China needs a truly independent and well trained judiciary and fair process of law to be able to enforce laws fairly and evenly across the country and to effectively fight corruption and abuse of power. This process will take some time, and be gradual and definition of the role of government go little noticed by Western policy makers. More reform in China and as always, implementation will be difficult. It is not unlikely that at the end of that part of the road, China will embark in an incremental way on a phase of its transformation towards a democratic society with Chinese-socialist characteristics, but 50 According to a statement by World Bank President Wolfowitz it is clear that the dismantling of the Leninist model of govin October 2005. Statistics vary as China uses a different poverning a country and organising the party has begun in earerty line which is lower than the internationally accepted 1 nest against internal resistance by conservative forces. While USD a day line. there is certainly no blueprint for democratic reform, there is 51 The AU and NEPAD have provisions and mechanisms that alone for government and civil and economic law reform and low interference in case of violations of constitutional arthe current party leadership is at least studying other counrangements and the African Peer Review cf. Alden(2006) pp tries’ policies and parties to find clues for its own further re20/1. forms. 11

Uwe Wissenbach The EU’s effective multilateralism – but with whom? Functional multilateralism and the rise of China 12 3) functional multilateralism as a pragmatic way to non-domestic constituents, too, without questioning address these challenges and overcome the value the principle of sovereignty as such. After all, it is bedilemma. yond doubt that even EU Member States, while poolEuropäische Politik (05/2007) ing parts of their sovereignty voluntarily to achieve China is set to continue its transformation both doEuropean added value, remain sovereign entities. Thus mestically and in its foreign policy. It has recognised in there is a large space for other countries to pool principle that globalisation cannot be dealt with by (smaller) parts of sovereignty(more loosely) to solve sovereign countries alone, but only through cooperaglobal issues while keeping their nationhood intact. tion, and that globalisation also influences economies Arguably, pooling sovereignty voluntarily is an act and societies across borders. The traditional stance on which enhances rather than constrains a country’s sovnon-interference in domestic affairs will need to adapt ereignty. Functional multilateralism can translate the to the new realities. The new focus by Africa on good EU’s and China’s sovereign political will to contribute governance and interference in domestic affairs to to global governance into binding transregional policy counter unconstitutional events are in stark contrast to regimes or even institutions to address key challenges China’s non-interference mantra, which might well fall brought about by globalisation in a loosely institutionout of fashion even with China’s traditional allies. alised partnership. Hence, China is under pressure to take the necessary steps to adapt its foreign policy to globalisation. In the meantime pragmatic, but lasting solutions are needed. Strategic objectives and expected results Functional multilateralism provides a way forward which is compatible with China’s more traditional forEU-China or EU-Asia Charters on issues such as energy eign policy principles and its more recent selective mulefficiency, industrial pollution, climate change, envitilateralism, while pragmatically adapting nonronmental norms or energy security could be the core interference to the new reality similar to how WTO of non-exclusive, multilateral, binding rules to address rules allow interference within a defined and agreed key challenges, without requiring institutional integraset of rules. tion, but going beyond traditional agreements by creAddressing the global drivers of change requires ating common management structures and supervisory that the political recovers the strategic space lost to boards for monitoring and arbitration in case of conmarket-ideology and global corporations. There is a flicts. Arbitration panels should include eminent perneed for global governance which reassures people sons appointed by consensus, for example, from ASEM everywhere(be it European unemployed or Chinese member countries and the European Commission. redundant workers or landless farmers) that markets These Charters could be open to other regions, such as unfold in a framework which takes account of social the AU, or states willing to join the mechanisms. and environmental costs. After all, the cheap manufacSince the mid-1990s the EU has started to outline tures that Europeans consume are made from African the content of a comprehensive partnership with ores, with African and Arab energy, South East Asian China, but without embedding it in a larger strategic components and Chinese labour. The environmental perspective 53 . Recently, prompted by US policy, the obcosts are often externalised through the destruction of jective has become to push China to become a responAfrican jungles, pollution of Chinese rivers and air and sible stakeholder in the international community 54 . Atthe social costs through lack of social security and pretempting to pressure China into simply accepting the carious health and safety for Asian workers. The EU Western agenda is likely to fail. China has to become a will have to pay a price for China’s rise and the cheap responsible member of the international community consumer goods which come along with it, as we have benefited from it. Globalisation cannot be managed through autarkic approaches or piecemeal bilateral agreements. It requires global leadership – from the EU and China. Together they have enough economic and 53 The EU’s policy papers on China are a valuable attempt to make the relations comprehensive, but do not really provide for a long-term strategy. Their frequency(1998, 2001, 2003, 2006) and the fact that it is difficult to reflect the upgrading of the relationship in the successive titles from one strategy trading power and credibility with the developing world to steer a different course of development. Since economic affairs, resources, the environment, drug document to the next unwillingly reveal that deficit. In 2006 negotiations for a new more comprehensive agreement than the 1985 Trade and Cooperation Agreement began. trafficking and diseases are no longer domestic affairs only, the governance of these issues is a matter for 54 Zoellick(2005). The EU entertains a strategic dialogue on China with the US. This is reflected in European Commission (2006).

allowing it to shape the different international agendas from the outset. A functional partnership built on multilateral Charters could provide such an avenue for membership without requiring too high an institutional price and without limiting it to a bilateral agreement. It could deliver: 1. a comprehensive, shared strategy and a mechanism with normative and financial commitments on climate change and other environmental challenges which lead to or support Chinese domestic reforms and better international governance to reduce the global environmental burden 2. more transparent fiscal measures and marketbased strategies in international sustainable energy and resource exploration, cushioned by strategic reserves that could possibly be jointly managed by an institution affiliated to the IEA or transparently coordinated 3. re-launch of a development centred international trade strategy and relevant agreements; transparency and consultation on currency policies, institutionalised cooperation between the EU(in a reformed G-8 perhaps) and the big developing countries or creation of a new institution to contribute to global economic and political governance 4. integration of China in a new international development policy agenda built on NorthSouth dialogue and South-South cooperation experience, and the EU’s and China’s multilateral partnerships with developing countries into a global multilateralism built on regional building blocks and cross-regional cooperation 5. cooperation on traditional and non-traditional security issues, fragile states, terrorism, WMD and promotion of related international treaties and regimes, and so on. These Charters would complement existing trade and partnership agreements and dialogues(for example, political and human rights dialogues) and may in time absorb more technical dialogues. China is a new type of global player, one that requires a new response beyond traditional power politics(including new varieties such as soft balancing and hedging) and as a complement to the present multilateral system. The EU has the potential to innovate global governance by promoting such a response based on functional multilateralism. Internationale Politikanalyse International Policy Analysis 13

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X Europäische Politik Uwe Wissenbach The EU's effective multilateralism – but with whom? Functional multilateralism and the rise of China T he paper addresses how China has become a key strategic issue for the EU in ways that are not reflected in the European Security Strategy(ESS). The analysis argues that given the unilateral orientation of the EU’s closest partner, the USA, which started long before the current administration and is likely to continue, the EU should occupy strategic space in relations between the US, China and other Asian countries and notably promote functional multilateralism as a pragmatic approach and common security as an alternative to the US balance-of-power concept carried over from the Cold War. Cooperative policies as a response to key global challenges such as the environment, energy and social issues are important priorities for both the EU and China. The EU should reject policies of containment and present alternatives based on functional multilateralism and try to secure the support of China to achieve desired policy outcomes and make multilateralism effective. This alternative will reduce the weight of territorial and sovereigntyrelated conflicts or concerns and allow Asian countries to develop win–win situations and common progress. China’s domestic priorities determine its foreign policy and recent changes point to a number of areas where the EU could successfully engage with China while maintaining and improving policies relating to human rights and the rule of law. China’s new policy of sustainable development, resource saving and environmental protection is a basis for an EU–China partnership based on functional multilateralism.