In January, the EU and China concluded in principle negotiations on an investment deal, with German Chancellor Angela Merkel and French President Emmanuel Macron playing an “active role” in driving through the accord. The pact came amid deep concerns about the Chinese government’s use of its economic clout to enmesh itself in Western countries. A European Commission statement said the agreement is of “major economic significance” and that China has “committed to an unprecedented level of market access for EU investors”.
Beijing indeed agreed to “work towards” meeting global standards on forced labour.
Chinese President Xi Jinping will join an EU-China leaders’ meeting in Brussels this year – another sign of growing links between the EU and China.
However, there is one EU member who has followed the UK’s steps and moved in a different direction: Sweden.
Sweden’s fight with China started over human rights in 2015 with the detention of a Swedish-Chinese bookseller, but has now escalated into a technology showdown after Stockholm booted out two Chinese companies, Huawei and ZTE, from supplying core 5G infrastructure.
Responding to Swedish charges that the kit could be used for spying, Beijing is now raising the spectre of retaliation against Swedish businesses, such as Ericsson and IKEA.
Other European nations such as France, Poland and Romania have also made steps to ban Chinese companies in their 5G networks – but few have been as categorical as Sweden in naming Huawei and ZTE as explicit security threats.
Sweden’s Post and Telecom Authority, citing an assessment by Sweden’s Security Services, when it banned Huawei and ZTE from the 5G rollout at the end of last year, said: “The influence of the Chinese state over the country’s private sector provides strong incentives for companies to act in accordance with the goals of the Chinese Communist Party’s national strategies.
“The Swedish Security Service judges that the Chinese state and security services can influence and exert pressure on Huawei.”
Sweden’s travails are of wider interest to the EU because they touch on important questions which many countries in the continent face, namely where to draw the line between often lucrative commercial deals with China and concerns over China’s human rights record and its history of spying on Western nations.
Nevertheless, Stockholm’s decision to call out Huawei as a security threat by name has made it an outlier among EU countries and brought it more in line with the US, which has clearly stated that it doesn’t trust Huawei and doesn’t think Washington allies should either.
White House Press Secretary Jen Psaki said on January 27: “Telecommunications equipment made by untrusted vendors, including Huawei, is a threat to the security of the US and our allies.
“We’ll ensure that American telecommunications networks do not use equipment from untrusted vendors, and we’ll work with allies to secure their telecommunications networks.”
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Huawei has challenged its exclusion from the Swedish 5G market in court, but failed to stop an auction of frequency bands relating to the 5G rollout going ahead on January 19.
A spokesperson for Huawei said its legal action was “ongoing” and its participation in Sweden’s 5G rollout remained “an open question”.
In an exclusive interview with Express.co.uk, Australian Liberal Party Senator Eric Abetz fiercely criticised Germany and France for pushing for the EU investment pact, giving “credibility to a belligerent bully”.
Mr Abetz said: “It is very unfortunate.
“While I can understand trade should continue, I cannot believe they have done so and engaged in a new agreement when China has got one million of their own citizens in concentration camps.
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“I think freedom-loving countries of the world should be pushing for reforms before they engage with Beijing as an equal partner, as China’s behaviour is completely unacceptable.”
He added: “I have no idea why Macron and Merkel pushed for it.
“They have basically given dictatorship a credibility that is not deserved.
“It was for the whole world to see how China treated Australia in recent times.
“China acts as a belligerent bully on the world scale.
“Why would you give them credibility by signing up to this agreement?
“It defies any logic and any principles.”