'Macron a very important piece of China's quest to rewrite post-WWII order'

1 day ago

Visit our website:
http://www.france24.com

Like us on Facebook:
https://www.facebook.com/FRANCE24.English

Follow us on Twitter:
https://twitter.com/France24_en

Transcript

00:00Get more insight, notably on the trade relations, we can speak now to senior fellow at the Burel

00:05Institute, specializing in emerging markets, notably on Asia and Asia-European related affairs.

00:11Alicia Garcia Herrero, thanks for your time and joining us. Can I start simply by asking you,

00:16firstly, we just heard it mentioned there at the end of that report, this trade deficit between

00:20China and the EU. How far do you think Macron might be able to get Beijing to move on that one

00:27and what will he use? Well, China has no intention to reduce the deficit. Actually,

00:35we probably hit 400 billion this year, as high as 2023. So we're not going to reduce our deficit.

00:43Our exports to China are actually growing negatively double digit, while our imports are growing

00:51positively double digit. So do not expect Macron to be able to change this, also because

00:57China has much more leverage. It can hit us with export controls. And we don't really have that

01:04kind of weapon to threaten China to reduce or to actually maybe import more from us or export less

01:13to us. So I don't think that's going to be able to change during this meeting with Macron.

01:20We have indeed seen China use its pressure recently. In fact, just in October, it threatened to

01:27suspend exports of rare earth minerals, a major area that it does have power. It suspended it for

01:34a year, but the threat is still there. Where do you see that going?

01:39Well, we have a year to get ready. We know that we're working on our economic security now to

01:45probably put some money on the table to be able to refine or find somebody to refine for us.

01:5317 rare earths, which is very difficult. Japan has been trying to do this since 2010. And it still

02:01depends 62% from China. Japan is extending basically a helping hand to Europe, which Europe should take

02:10to basically cooperate with Japan to refine some of the rare earths that Japan is still not able to

02:18refine. So basically do this together. And the commission is going to put some money, I heard,

02:22around $2 billion to do this. Hopefully, again, with some cooperation with Japan. Also,

02:29the UK has its own plan at 500 million sterling. So we all need to cooperate to reduce our dependence

02:35on China on rare earth. That's very clear. But China will not give us the solution. That's not

02:39going to come from Beijing. It's a big, big plus for them.

02:43These rare earth minerals, for anybody watching, I mean, they're so valuable in today's world from

02:47green energies, to electric vehicles, to all of our telephones or our computers. The EU seems to have

02:53fallen really far, far behind, not just China, but the US and other countries when it comes to securing

02:59their security, if you like, in accessing these rare minerals. Any idea why? And what exactly is it

03:05doing now? Is it doing enough or too little too late? Well, we fell behind because we thought it was

03:13not strategic. It's actually, if you look at the actual amount, say, gallium, the gallium market,

03:19which is essential for military possession weapons in particular, is only around 1.2 billion. The global

03:27market is actually not something that countries thought China could weaponize because, in a way,

03:35it is such a small part of the pie. But of course, the minute that everybody else stopped producing or

03:41refining partially because of environmental regulations, China basically managed to profit.

03:49But I don't think this is going to last forever. I think China will have to realize that others are

03:54going to come to the forefront. Canada can do it. Australia can do it. It's just a question of,

03:59fine, that we will manage to do this. But meanwhile, this is a big weapon for China,

04:06as I mentioned. So we need to get ready for this. Meanwhile, the US-China trade tensions,

04:12I mean, how are they impacting the trade with Europe?

04:14Well, now we have to realize that the US is basically realizing that it doesn't have the

04:26leverage that it thought it had on China. And it's trying really to calm down, basically,

04:33the relations. This is everything we see, even on export controls. The US is ready to export

04:39as something really that I never thought they would export, like the new Nvidia Backwell GPUs,

04:49which really give the US the comparative advantage on the AI space. Why? Because Trump is increasingly

04:57trapped. This is not a good news for Europe, because it means that China and the US will get

05:02a loan, probably to our detriment. So this is the big point for Macron in his visit, make sure that

05:10we're not cornered in this increasingly cozy relation between the US and China.

05:15And finally, before we let you go, I mean, Macron also expected to try and get China to put pressure

05:21on Russia in Ukraine. I mean, how is that conflict affecting the trade relations?

05:25Oh, let's be very frank. I want to be quite honest here. China needs Macron, not for Ukraine. We need

05:36China for Ukraine. China has not been there for four years. Forget it. The peace agreement between

05:42the US and Russia has the green light of China. China is not going to help us on this. However, China would

05:50very much like to have Macron help China on its quest for Taiwan. And why is this the case? Because

06:00at the end of the day, France is part of the Security Council, and China is starting to make moves with

06:05letters against Takaichi's comments on Taiwan. This is going to continue. So in that regard, Macron is a

06:13very important piece of China's quest to rewrite the end of the Second World War, that Second World War

06:20order, you know, the San Francisco Treaty, you name it. All of that is something which Macron could

06:27help China. So this is what I think China is after in this visit.

06:31OK, definitely one to watch. Alicia Garcia Herrero of the Bruxelles Institute in Brussels. Thanks very much,

06:37indeed, for your time.

'Macron a very important piece of China's quest to rewrite post-WWII order'

Category

Transcript

Be the first to comment

Recommended