Congress and the European Parliament must work together to counter China

An alignment of views between the U.S. and its European allies on how to deal with China could help create a united front, making it more difficult for Beijing to engage in unfair trade practices that harm Western businesses and consumers. However, to be effective such a front needs to include not only governments, but also legislatives bodies, especially at this historic juncture which sees lawmakers on the two sides of the Atlantic adopting initiatives to contain China.

On June 8, the U.S. Senate adopted the U.S. Innovation and Competition Act, a bipartisan legislation designed to counter China by investing roughly $250 billion in U.S. technology, science and research. The bill offers the Biden administration a host of recommendations for how to work with the European Union on trade, technology, export controls, investment screening and more. The Senate passed the legislation a week before President Joe Biden met with EU leaders in Brussels to repair transatlantic ties which had been severely damaged when former President Donald Trump was in office.

The U.S.-EU Summit Statement, issued on June 15, was largely devoted to China. A concrete outcome of the summit, the U.S.-EU Trade and Technology Council was formally launched with the aim to foster transatlantic cooperation on digital issues, technology and supply chains, as well as work on international standards development and support collaborative research efforts. The council will be composed of various working groups. For the U.S. side, Secretary of State Antony Blinken, Commerce Secretary Gina Raimondo and U.S. Trade Representative Katherine Tai will co-chair the council, while on the European side the co-chairs will be the EU Competition Commissioner Margrethe Vestager and EU Trade Commissioner Valdis Dombrovskis. 

To make a U.S.-EU front against China more effective, the two sides’ legislatures should also be involved. The U.S. Congress should take the lead, reaching out to the European Parliament to propose setting up an inter-parliamentary group with focus on China. This would complement Biden’s strategy to reach out to the European allies to counter Beijing’s growing influence.

Relations between the U.S. House of Representatives and the European Parliament can be traced back to 1972. In 1999, the two legislative bodies formalized their institutional cooperation into a framework called the Transatlantic Legislators’ Dialogue. To date, there is no joint working group in place, nor are there exchanges between legislative committees of the European Parliament and the U.S. Congress with focus on China. It is time to fill this gap.

The European Parliament would be the ideal partner, since its influence in Europe is growing as a result of the EU’s Lisbon Treaty, which increased the relative power of the Parliament within the EU, and in some cases, with significant implications for U.S. interests. The European Parliament has traditionally taken positions more critical of China than other EU institutions — such as the European Commission and the European External Action Service (EEAS – Europe’s diplomatic corps) — as well as EU member states which tend to seek compromise with China for fear of retaliation.

On May 20, an overwhelming majority of the European Parliament voted to suspend ratification of the Comprehensive Agreement on Investment, a deal that would have expanded trade and investment ties between China and the EU. The move came after Beijing had imposed retaliatory measures against EU members of parliament for their support of sanctions against China for its oppression of the Uighur population.

The Chinese sanctions on several European entities and political representatives, including five members of the European Parliament and the Subcommittee on Human Rights, were a retaliatory act in response to the EU decision to enact restrictive measures against four Chinese officials over human rights abuses against the Muslim Uyghur minority in the Xinjiang region.

The European Parliament’s decision to freeze the Comprehensive Agreement on Investment reflects growing disenchantment with China among lawmakers who are determined to stand up more firmly to Beijing. Still, China remains Europe’s second largest trading partner, and any moves against Beijing could open the door to escalating economic retaliation — a prospect that may limit how far European governments and the European Commission are willing to go in joining U.S. efforts to pressure China. In fact, it is very likely that some EU governments will seek to resurrect the agreement, if Chinese sanctions are lifted. This is what Angela Merkel — the real driving force behind the signature of the agreement — would like to achieve, before she steps down as German Chancellor in September.

The U.S. Congress should step up consultations with the European Parliament on China’s unfair trade practices to ensure that if the Comprehensive Agreement on Investment is resurrected and ratified, it is done in a way that does not undermine transatlantic unity. In the same vein, the recently approved U.S. Innovation and Competition Act would be more effective if European allies were implementing similar measures to counter China.

A U.S.-EU inter-parliamentary group on China would support the nascent transatlantic China dialogue and foster an alignment of views between the U.S. and its European allies, making sure that legislation on the two sides of the Atlantic would support, and not run against, a united front.

Dr. Nicola Casarini is a fellow with The Wilson Center’s Global Europe Program.