, either a Chinese colony or an American colony,” he said of a scenario in which rivalry between China and the United States could lead to a world of two hostile power axes.
Nowhere is it more pressing than for Europe, whose wealth has always relied on trade, from its rapacious colonial history through to its reinvention as self-styled champion of WTO rules. Both the United States and Europe have been hardening their stance towards Beijing while stressing the rules of world trade must be fairly applied. But Washington, some observers argue, is already testing how far those rules can be stretched.
“ firms need to be prepared for extreme scenarios in which the US forces them to leave China,” warned a discussion paper presented to EU finance ministers last month entitled “Dealing with Europe’s Economic security”. On the other, EU capitals may have to stump up billions of euros of new money to help local industries develop yet-to-be-confirmed strategic technologies.
“Of course, the EU should approach China differently to how the US does,” he said, arguing that differences in human rights and ideology could be worked through.this year concluded that, if the world economy split into U.S.-centred and China-focused axes, Europe would fare best by remaining open to both, but noted it “might face heavy costs if such a policy approach significantly raises the possibility of barriers between itself and the US”.
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