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By STUART LAU
with PHELIM KINE
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GOOD U.S. ELECTION DAY MORNING. This is Stuart Lau reporting from among all the nervous onlookers in the EU quarter in Brussels, as Americans head to the polls. Phelim Kine will have the full post-election analysis for you in 48 hours.
US ELECTION IMPACT ON CHINA, EUROPE
TRUMP LOOMS AGAIN: The conventional wisdom for Chinese strategic thinkers goes like this: When U.S. politics is in disarray, it’s an opportune moment to drive a wedge between Europe and America. Four years ago, Beijing clinched what could have been a massive investment agreement with the EU in the final weeks of the Donald Trump administration. This time round, Europe fears the worst for Ukraine in the event of a Trump victory — and is slowly talking up Beijing’s potential as a mediator for Ukraine, despite its public support for Russia.
But that doesn’t mean there will be an immediate EU-China love-in should Trump win. For now, the trade tensions seem too high for that.
— EU-China trade war goes on: In the past, Beijing portrayed itself as a common victim along with Brussels, both being unfairly treated in Washington’s trade war. But the current trade climate is different. Brussels’ battle with Chinese electric vehicles escalated on Monday, when Beijing kickstarted a dispute at the World Trade Organization against the EU's definitive duties on the Made-in-China cars, days after the EU finalized its decision to impose duties of 8 percent to 35 percent on Chinese EV brands.
— EU is negotiating … A team of EU trade negotiators was in Beijing to try to work out a deal, according to the incoming EU Trade Commissioner Maroš Šefčovič. In the European Parliament hearing yesterday, covered by Camille Gijs and Koen Verhelst, Šefčovič described China as a “very complicated and very often difficult partner.”
“We clearly need to invest more in not only using our instruments, but also de-risking our relationship with China through diplomacy,” he added, calling for a continuation of the strategy of “de-risking” — i.e. not decoupling from China but reducing exposure.
… while prepping for the worse to come: He vowed not to accept coercive behavior, promising a "fair and forceful" response. "We've already reacted forcefully to the flawed attempts by China" to target diary, brandy and pork, said Šefčovič, adding that if talks with China fail, "we have contingency plans in place."
— Later on Monday: Šefčovič was approved by MEPs as the next trade and economic security commissioner.
COZYING UP: Despite the hostility over trade, there are some signs of attempted China-EU rapprochement to watch on the diplomatic front in Germany, Slovakia, Czechia and Lithuania.
GERMANY COULD ENLIST BEIJING FOR FINLANDIZATION OF UKRAINE: While Ukrainian President Volodymyr Zelenskyy is pushing for an invitation to join NATO, Berlin is putting the brakes on. My Berlin colleague Hans von der Burchard wrote that Germany’s been bringing up a counter-proposal of a "non-aligned" Ukraine similar to Finland during the Cold War — which was neither a member of NATO nor the Warsaw Pact.
— The idea of a "contact group" fits in with this: The idea is that Germany and its Western allies could bring together other countries such as China, India and Brazil to work out a peace solution with Russia.
BEIJING <3 SLOVAKIA: In the same vein of engagement, China has reached out to the Slovak prime minister, one of the few EU leaders sympathetic to Russia, in its latest diplomatic charm offensive. Robert Fico, who survived an assassination attempt with four gunshots in May, pledged to consider joining China’s “Friends for Peace Group on the Ukraine Crisis” — boycotted so far by Kyiv — alongside his Hungarian soulmate Viktor Orbán.
PRAGUE, WE NEED YOUR HELP: During his visit to Prague, Deputy Commerce Minister Ling Ji emphasised Beijing hopes the Czech Republic will play an “active role” in the upcoming negotiations with the EU, reports our colleague Tommaso Lecca. The visit comes despite Prague hosting former Taiwanese President Tsai Ing-wen.
ALL GOOD NOW, LITHUANIA? The winner of the Lithuanian parliamentary election says it's time for the country to mend ties with China. Gintautas Paluckas, the Social Democrat candidate for prime minister, said: “Normalization of relations is a certain aspiration because the European Union … is trying to maintain diplomatic relations."
Watch out for next steps: The previous government made a "grave diplomatic mistake" by allowing Taiwan to set up a representative office in Vilnius, Paluckas said — but he wouldn't reveal whether he would comply if Beijing asks for it to be renamed. Paluckas said the reengagement with China would proceed "without groveling, without falling down, without kowtowing or begging for anything." There are currently no ambassadors between China and Lithuania.
EU PARLIAMENT
BEIJING'S OVERTURE TO EU PARLIAMENT: Top Chinese officials have sought to break the ice with the European Parliament in the first known meeting with senior lawmakers since Beijing slapped sanctions on MEPs in 2021, Eddy Wax reports with Stuart.
Olive branch: German center-right MEP David McAllister, who chairs the Parliament's foreign affairs committee, told Eddy that Chinese officials sought a meeting and he agreed in order to "figure out what the Chinese want." The previously unreported meeting took place on Oct. 15 in McAllister's office.
In the room: Joining McAllister were German MEP Engin Eroglu, a liberal who chairs the China delegation, and Parliament officials. Attending from the Chinese side were its new Ambassador to the EU Cai Run, Fu Ziying, the vice chair of the foreign affairs committee of the National People's Congress (who flew in from Beijing), and two other government officials.
Wanna visit Beijing? Eroglu told China Watcher that the Chinese officials quizzed him on his intention to travel there. “I have been invited to visit, but I don’t consider visiting the PRC in my capacity as [delegation] chair while members of this House are under sanctions,” he said.
But but but: Eroglu, whose predecessor Reinhard Bütikofer is one of the five MEPs Beijing has personally sanctioned, added: “It is my understanding that official missions to the PRC could be authorized if sanctioned members are included.”
The vibe was frosty: McAllister recalled the meeting as such: "It was a one-hour ping pong game. I said no” to further exchanges if MEPs remain sanctioned, he said. “The first step was that you take our colleagues off the sanctions list."
Beijing slapped sanctions on 5 MEPs and Parliament's human rights subcommittee (along with other European entities and individuals) in 2021 after the EU imposed sanctions on Chinese officials over the treatment of the Uyghur minority in Xinjiang. Since then, the relationship between China and the Parliament has been frozen.
Not again: Eroglu is lukewarm about further exchanges. “The format of the last meeting was exceptional. I don’t expect anything to happen that goes beyond that.”
INDO-PACIFIC
PANGAPSUMNIDA: About 11,000 North Korean soldiers were in the Russian district partly controlled by Ukrainian forces, Ukraine’s President Volodymyr Zelenskyy said last night. Meanwhile, North Korean Foreign Minister Choe Son Hui met Russian President Vladimir Putin in the Kremlin yesterday — the Russian Unity Day — and the two shook hands for a full minute.
BORRELL IN SEOUL, TOKYO: The EU’s outgoing foreign policy chief Josep Borrell paid one last visit to South Korea and Japan, signing new EU “security and defence partnership” agreements with both countries. (This one with Seoul; and this one with Tokyo.)
What’s new in there? Not much, except on language on maritime security which would catch Beijing’s attention. To both countries, the EU will seek to promote “an open and rules-based maritime regional security architecture,” including “secure sea lines of communication and freedoms of navigation and overflight.” (Read: South China Sea and Taiwan Strait.)
MYANMAR JUNTA CHIEF FINALLY VISITS CHINA: Myanmar junta leader Min Aung Hlaing will travel to China in his first visit to the influential neighbor since he seized power in a 2021 coup, a remarkable break of his international isolation. Reuters has more.
TRANSLATING WASHINGTON
LAWMAKERS BASH BEIJING'S ADOPTION BAN: Capitol Hill's latest fight with Beijing —challenging its suspension of adoptions of Chinese children by foreign citizens in September. That move has fueled a bipartisan effort to push the Biden administration to persuade Beijing to reverse that decision. "The policy decision was made at top levels within the PRC, necessitating your direct intervention," said a group of more than 100 lawmakers from both houses including Sens. Ben Cardin (D-Md.), chair of the Senate Foreign Relations Committee and Chuck Grassley (R-Iowa) in a letter to President Joe Biden released Friday.
China's Ministry of Civil Affairs announced that policy change in September without providing a reason. The adoption suspension has baffled both the State Department and prospective U.S. adopting parents. Adoption agencies say that decision bars around 300 prospective U.S. adoptive parents who have spent years navigating Chinese bureaucracy and spent thousands of dollars in processing fees from adopting Chinese children. Beijing isn't budging. The adoption restriction is "in line with the spirit of relevant international covenants," said Chinese embassy spokesperson Liu Pengyu.
STATE OFFICIALS URGE DIVESTMENT FROM CHINA: A group of 18 financial officers from 15 U.S. states are urging state pension boards —which manage the investments for state pension funds —to withdraw money they have invested in China. Rising geopolitical risks —including a possible "near future" Chinese invasion of Taiwan — make U.S. investments in Chinese assets highly vulnerable to loss, the officials from states including Alaska, North Carolina and Nebraska wrote in a letter to "Public Pension Fund Fiduciaries" on Friday. The officials warned that state pension plans "failed to recognize similar warning signs before Russia's invasion of Ukraine in 2022 — as a result, states lost billions of dollars in value that was held in trust for retirees."
The letter underscores how concerns about the economic spillover effects of a possible future U.S.-China military conflict are seeping into policy decisions at the state level. Five states — Indiana, Florida, Missouri, Oklahoma and Kansas — have directed state fund administrators to begin the divestment process over the past year. And more are considering doing so — the latest sign of deteriorating relations between the U.S. and China. Beijing says they're all overreacting. States' moves to "politicize normal U.S. investment in Chinese markets… will only cost them business opportunities and undermine the interests of U.S. investors," said the Chinese embassy's Liu.
CHINA'S EMBASSY SEES RED OVER NED: The Chinese government has a fresh bone to pick with the National Endowment for Democracy — a State Department-funded nonprofit Reagan-era entity dedicated to "strengthen the bond between indigenous democratic movements abroad and the people of the United States" in 100 countries. Beijing says it's dedicated to destabilizing China through support of Xinjiang Uyghur diaspora groups including the World Uyghur Congress. That's the message of a video that Chinese embassy spokesperson Liu posted on X Friday with the comment: "Clearly, the U.S. is seeking to turn Xinjiang into a tool to contain China." The video — produced by Chinese state television —features a trio of talking heads who accuse the U.S. government of "fomenting unrest" and seeking to "bring China down through riots in Xinjiang." NED-bashing is a routine feature of Chinese English-language propaganda that included a foreign ministry screed published in August that accused the organization of " innumerable evil deeds [that]have caused grave harm." NED didn't respond to a request for comment.
IN OTHER HEADLINES
ATLANTIC: China and the axis of disruption.
BLOOMBERG: LVMH's Empty Chinese Megastore.
FT: Chinese warships could use Peru's big new port, U.S. general warns.
MANY THANKS: To editor Christian Oliver, reporters Eddy Wax, Camille Gijs, Koen Verhelst, Hans von der Burchard and producer Catherine Bouris.
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