There are two actors offstage — the European Union and Japan — watching the spectacle at the Temple of Heaven in Beijing as the leaders of America and China celebrate their supremacy as the 21st century’s two economic superpowers.
The May 14-15 summit between President Donald Trump and the Chinese leader Xi Jinping is their first meeting in six months and the first time that Trump has visited China since 2017.
On that occasion, his hosts led him through the Forbidden City to recall the centuries when emperors ruled in tranquil grandeur over the largest economy on earth.
It was, of course, the expansion of Europe, which doomed the late empire and led to what Xi has called “more than a hundred and fifty years of humiliation.”
Now he greets the American president on more than equal terms to make decisions for which the Europeans and Japan can only watch and wait.
The fear in Brussels and Tokyo is that the two leaders intend to create a “G2” world in which secondary nations are reduced to the status of tributary powers, accepting the role that China assigned to its Asian neighbors in imperial times.
This week, the Chinese state media sent a subtle message of reassurance by coverage of the 130,000th journey of the China-Europe railway express, when a cargo train left the city of Zhengzhou bound for Hamburg.
The service has transported cargo worth more than $520bn, the official news agency Xinhua quoted China’s State Railway Group as saying. It now links 129 cities in China to 235 cities in 26 European countries.
High-value export cargoes include automobiles and auto parts, machinery, electronics, and electrical equipment, while imports by rail include European timber, pulp, specialty agricultural products and consumer goods — all without risking a single voyage on perilous sea lanes. Freight rates have fallen by 40%, Xinhua said.
It was meant as a reminder of the “win-win” co-operation which China holds out as a prospect for partners who comply with its own strategic interests.
The EU is locked in disputes with China over trade, technology, and exchange rates; it should have common cause with the US, but to the delight of the Chinese negotiators, the two notional allies are divided by culture wars and estranged over tariffs, high-tech export controls, and foreign policy.
A new risk for European companies trading with China is that they may be caught in a vice between heavier US sanctions on the export of chip manufacturing equipment, and reciprocal measures in two new Chinese laws penalizing any firms that comply with them.
While the Trump administration seeks to contain China’s economic rise, the Xi Jinping regime has efficiently managed to decouple its state-backed export machine from reliance on the US market, while it reduces its need for American technology.
The Trump-Xi summit is likely to result in an extended truce rather than a settlement of insoluble outstanding issues, leaving trading partners and allies to navigate an ever-shifting landscape without rules.
For Europe, the age of uncertainty is already here; perhaps that started with the first Russian invasion of Ukraine in 2014, but without doubt since President Trump began his second term last year in a whirlwind of contradictory decrees and rhetoric.
Diplomats in Tokyo say this has led to a closer dialogue between the EU and Japan. Under conservative Prime Minister Sanae Takaichi, political tensions with China have sharpened amid minor tit-for-tat economic sanctions. Japan’s first woman premier is doing her best to stay on good terms with Trump while asserting Japan’s common interests with the other industrialized democracies in the survival of a rules-based order.
It was notable that US Treasury Secretary Scott Bessent paid visits to Japan and South Korea to reassure them that the United States would remain a reliable partner. In Tokyo, officials said he expressed “understanding” for Japan’s intervention in currency markets as its central bank manages a weak yen.
The four-way interaction between the EU, the US, China, and Japan may be complex, but hard numbers from the European Commission underline how vital it is.
China remains the third-largest trading partner for the EU after the United States and the United Kingdom. It is the bloc’s fourth-largest export market (although it is worth keeping in perspective that China is behind third-placed Switzerland). Overall, the EU had a goods trade deficit with China of €360bn ($422bn), an increase of 2.7% year on year.
Moreover, the latest official figures show Chinese exports to the EU are increasing while European exports to China are falling. Investment flows from China into the EU far outstrip those from the EU into China.
Brussels says the economic relationship is “critically unbalanced” because the state-backed Chinese model creates “systemic distortions.” It points to “an ever-widening set of export controls which lack clear dual-use justifications,” it worries about Chinese curbs on critical minerals and technology; it fears a “more politicized business environment” and says that in important sectors China remains largely a closed country.
These issues derive in part from President Trump’s trade war with China, a struggle in which America’s trade partners are both bystanders and unwilling protagonists.
Xinhua has reminded its readers that in 2017, Xi and Trump walked together through three ancient halls evoking the theme of harmony: “an experience imbued with the Chinese cultural ideal,” it said.
This time, they are due to visit the great blue-tiled circular temple outside Beijing, where the emperors performed rituals to pray for good harvests to underline their mandate from heaven. The message needs no explanation.
Michael Sheridan is the author of ‘The Gate to China’, an acclaimed history of Hong Kong, and ‘The Red Emperor: Xi Jinping and His New China’, which is published by Hachette Books and has been translated into a dozen languages, including Ukrainian, Polish, and Japanese.
Europe’s Edge is CEPA’s online journal covering critical topics on the foreign policy docket across Europe and North America. All opinions expressed on Europe’s Edge are those of the author alone and may not represent those of the institutions they represent or the Center for European Policy Analysis. CEPA maintains a strict intellectual independence policy across all its projects and publications.
