Brussels should develop “new defensive instruments” for sectors similar to quantum computing and synthetic intelligence because it updates its safety insurance policies within the face of an more and more assertive China, the European Fee president has mentioned.

Ursula von der Leyen mentioned the EU wanted to determine a transparent line for commerce in extremely delicate applied sciences the place army use can’t be excluded, or the place there are human rights implications, because it seeks to find out “whether or not investments or exports are in our personal safety pursuits”. 

The fee is for instance inspecting the creation of a mechanism for scrutinising abroad funding by EU firms in a small variety of delicate applied sciences that would improve the army capabilities of rivals, she added.

The fee president’s speech comes because the US steps up strain on its allies to align nearer with Washington and harden their method to China as tensions rise over Taiwan and Beijing’s help for Russia’s conflict in opposition to Ukraine.

Von der Leyen, who held talks in Washington DC with US president Joe Biden this month, warned of a “deliberate hardening” of China’s strategic stance, including that Beijing was changing into “extra repressive at house and extra assertive overseas”. 

The EU wanted to make sure that its firms’ capital, experience, and information weren’t used to boost the army and intelligence capabilities of the bloc’s “systemic rivals” — of which China is one.

She added: “A powerful European China coverage depends on robust co-ordination between member states and EU establishments and a willingness to keep away from the divide and conquer ways that we all know we could face.”

Von der Leyen was talking forward of a deliberate journey to Beijing subsequent week with French president Emmanuel Macron. She has tried to steer a line on China that’s distinct from that of the US, stressing her aim is to not “decouple” Europe’s financial system from China however fairly a means of “de-risking”. 

The fee president mentioned she needed to go away area for discussing “a extra formidable partnership” and making competitors fairer and extra disciplined. “We don’t wish to lower financial, societal, political and scientific ties,” she mentioned.

However her speech on the European Coverage Centre and the Mercator Institute for China Research represented what she described as a “sober evaluation” of relations and China’s strategic intentions. Chinese language president Xi Jinping, she mentioned, “primarily needs China to turn out to be the world’s strongest nation”.

“The EU must outline its future relationship with China and different nations in delicate high-tech areas similar to microelectronics, quantum computing, robotics, AI, biotech and others,” she mentioned.

“The place dual-use functions can’t be excluded or human rights may be implicated, there’ll have to be a transparent line on whether or not investments or exports are in our personal safety pursuits.”

The Netherlands not too long ago mentioned it will block exports of probably the most superior silicon chipmaking instruments to China after strain from the US.

Preliminary concepts can be introduced as a part of a brand new financial safety technique this yr, she mentioned.

The fee president additionally known as for EU unity over the “bolder and quicker” use of present commerce devices in areas similar to international direct funding, international subsidies and so-called financial coercion.

Von der Leyen mentioned the EU would want to “reassess” the Complete Settlement on Funding with China, a commerce deal that was not ratified and has stalled since 2021. “Now we have to recognise that the world and China have modified within the final three years, and we have to reassess CAI in gentle of our wider China technique.

“There are some areas the place commerce and funding poses dangers to our financial or nationwide safety, notably within the context of China’s express fusion of its army and business sectors,” she warned.

This goes particularly for delicate applied sciences, dual-use items and funding that entails pressured know-how transfers. The EU, she added, can be “stress-testing our relationship to see the place the best threats to our resilience, long-term prosperity and safety lie”.

The EU additionally wanted to make its personal financial system extra aggressive and resilient, together with by strengthening and diversifying provides of uncooked supplies.

Referring to Xi’s go to to Russian president Vladimir Putin in Moscow final week, von der Leyen mentioned it was clear that China sees Putin’s weak spot as a means of accelerating its leverage over Russia.

“Removed from being postpone by the atrocious and unlawful invasion of Ukraine, President Xi is sustaining his ‘no limits friendship’ with Putin’s Russia,” she mentioned. “It’s clear that the ability steadiness in that relationship — which for a lot of the final century favoured Russia — has now reversed.

“Any peace plan which might in impact consolidate Russian annexations is solely not a viable plan. Now we have to be frank on this level.”

She warned: “How China continues to work together with Putin’s conflict shall be a figuring out issue for EU-China relations going ahead.” Equally, China’s compliance with worldwide human rights obligations may even be a “check” for a way a lot the EU can co-operate with China.

Further reporting by Andy Bounds in Brussels

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