China’s call for the Renmimbi to replace the dollar as the world’s reserve currency, and its limited fiscal stimulus were triumphs for Chinese diplomacy. And while delegates mingled in the Excel Centre, the Chinese navy was busy spelling out long-range ambitions, including plans to build large combat warships, next-generation aircraft and sophisticated torpedoes, the offensive intent of which should be clear to all. 

So what should our China policy be? That is the question my ECFR colleagues John Fox and Francois Godement attempt to answer in a new report. I asked John, a former British diplomat and China expert a few questions.

DK: Does China have us – the West, the EU – over barrel?

JF: China’s foreign and domestic policy has evolved in a way that has paid little heed to European values, and today Beijing regularly contravenes or even undermines them. The EU’s heroic ambition to act as a catalyst for change in China completely ignores the country’s economic and political strength and disregards its determination to resist foreign influence. The result is an EU policy towards China that can be described as “unconditional engagement”: a policy that gives China access to all the economic and other benefits of cooperation with Europe while asking for little in return.

The EU allows China to throw many more obstacles in the way of European companies that want to enter the Chinese market than Chinese companies face in the EU – one reason why the EU’s trade deficit with China has swollen to a staggering €169 billion, even as the EU has replaced the US as China’s largest trading partner. Efforts to get Beijing to live up to its responsibility as a key stakeholder in the global economy by agreeing to more international coordination have been largely unsuccessful. The G20 summit in London in early April 2009 demonstrated Beijing’s ability to avoid shouldering any real responsibility; its relatively modest contribution of $40 billion to the IMF was effectively payment of a “tax” to avoid being perceived as a global deal-breaker.

So whilst there is interdependency between China and the EU (and the US) and China doesn’t exactly have the EU over a barrel, the EU is certainly the doormat in the relationship and China pulls no punches in walking all over it.

DK: You write in your report that the EU needs to move to a China policy of “reciprocal engagement”, but is there any evidence that China would respond to such an approach?

JF: The EU – often in tandem with the US – has achieved small but real changes in Chinese policy that shows that China can shift its position when faced with a united EU approach on targeted issues. The EU, acting through the E3 troika of Britain, France and Germany, has managed to get China to back its efforts to halt Iran’s uranium enrichment programme – but at the cost of having China shield Iran from tougher measures.

The backing of China, a veto-wielding state, for the European position in the UN security council has been essential, and EU efforts to bring China on board were a diplomatic success.  Issues such as Darfur and Iran show that China will shift its position when faced with united and focused demands. EU member states will find themselves in a far stronger negotiating position when it comes to tackling illegal dumping practices and encouraging further economic opening by China through adopting a “reciprocal engagement” approach.

Similarly, the push for China to pay more attention to human rights will stand a much better chance of success if it is backed by the large group of European countries who prefer to accommodate China on political issues for supposed trade benefits.

DK: “Reciprocal engagement” or tit-for-tat competition? Is there really a difference?

JF: “Reciprocal engagement” is not code for tit-for-tat competition or an aggressive strategy to contain China. The EU has no choice but to engage China as a global partner and to accept its historic rise. Rather, the EU must make it in China’s best interests to deliver what Europeans are asking for. Reciprocal engagement means firming up the EU approach and driving a harder bargain in negotiations with China, with the aim of coming to mutually beneficial deals that result in greater openness on both sides.

Reciprocal engagement espouses two principles and two criteria. The principles: European offers to China should be focused on a reduced number of policy areas, and the EU should use incentives and leverage to ensure that China will reciprocate. The criteria: relevance to the EU, and a realistic expectation that a collective European effort will shift Chinese policy.

DK: Your report is about the EU’s China policy. You barely mention the US except when you argue that EU leaders need to make a case “to their American interlocutors that the best results with China. .. .can only be achieved through partnership with Europe.” But is the reality not an emerging “Pax Chimerica”, where the EU’s role will be largely irrelevant?

JF: The election of Barack Obama has opened a new chapter in US foreign policy, but one marked by unprecedented economic challenges and the rise of China and other powers. The American debtor and its Chinese lender have locked each other into a symbiotic embrace. Whilst talk of a G2 or pax Chimerica is premature, it is clear that if Europe wants to avoid being left on the sidelines it needs to completely change the way it engages China, and the US.  To be heard on these issues, the EU needs to move fast to demonstrate its importance to China – and it must make a similar effort in Washington.

Europeans need to make the case to their American interlocutors that the best results with China, whether on climate change, rebalancing the world economy or fighting the spread of nuclear weapons, can only be achieved through partnership with Europe. And they will need to persuade China that listening to the EU on major strategic issues pays, while ignoring it carries a cost.

DK: You say that China policy has been based on the false presumtion that Beijing will change if the EU engages. Does this mean we have to give up all hopes of China ever changing her ways?

JF: China is not by any means static. The point in our report is that China is not a malleable entity to be shaped by European engagement – China is developing politically and economically in a way it is itself defining. There is increasing public debate within the country on a range of topics not directly linked to the regime’s legitimacy and ideology. But no positive steps can be directly linked to European or even western pressure. Treatment of Chinese human rights advocates – a topic regularly raised by EU leaders – has actually worsened in recent years.

EU hopes that China would continue opening up its economy following its accession to the World Trade Organisation (WTO) in 2001 have been disappointed– the Chinese government has treated WTO membership as the end of the reform process rather than a beginning. Beijing has tightened central control of Chinese firms and reinforced informal barriers to foreign entry into the Chinese market.

Political liberalisation seems to have stalled, or even reversed: China has tightened restrictions against NGOs, stepped up pressure on dissidents, and stopped or rolled back local electoral reforms. At the UN, Beijing has built an increasingly solid coalition of general assembly votes, often mobilised in opposition to EU values such as the defence of human rights. However to renounce human rights goals in the name of “realism” would weaken the essential principle of the EU and European society – the rule of law. Instead, the EU must bolster the credibility of its human rights stance – including, when necessary, listening to criticism by China and Chinese citizens of its own criminal law and human rights practices.

But what should NATO do? There is obviously no point in undermining the emerging détente between the US and Russia, promoted by the Obama administration. Yet at the same time, the thaw in relations should not allow Russia to play its bullyboy games. I told a journalist today:

The new relations could oblige NATO to reconsider the exercises in Georgia, as long as this is done not just to please Russia but because we are rethinking how to engage Russia and Geogia.

It is worth elaborating a little on this. The strategic context has clearly changed and NATO probably needs to appreciate this. The alliance cannot afford to be out of synch with its largest stakeholder. NATO’s Russia policy cannot be about Georgia alone, just as the West’s China policy cannot only be about Tibet. But any review of policy must not be seen as bowing to Russian pressure or stepping away from NATO’s “open door” policy – which welcomes new, peaceful democratic members if they wish to join.

Opinion polls have the left-leaning Congress party of incumbent Prime Minister Manmohan Singh and the main opposition Hindu nationalist Bharatiya Janata Party (BJP) neck and neck, with neither party likely to govern alone. So the stage is set the scene for horse-trading with a “Third Front” alliance and an array of regional and other smaller parties. One potential kingmaker is Kumari Mayawati, who is bidding to become the nation’s first Dalit – or bottom-rung caste – prime minister

Though issues such as poverty and how best to develop the countryside have been debated, in the wake of the last year’s Islamic militant attacks on Mumbai this year has seen national security become a major theme.

Security analysts fear the electoral consequences of another Mumbai-style terrorist attack. If that were to happen – and links back to Pakistani established — the current government would be hard-pressed to act against Pakistan in some. BJP would certainly be braying for tough action.

Even if the elections take place relatively quietly (with 714 million people voting, allow for some violence) India’s relationship with Pakistan is likely to remain fraught. Relations between the two countries have never been warm, but the five-year peace dialogue has now most definitely ended. Barring another terrorist atrocity, a direct confrontation between the two powers may be unlikely, but both governments will continue their proxy conflicts. This is bad news for Afghanistan, which plays host to the conflict. Neither the Congress Party nor the BJP seems to be willing to think through how to revert the Indian-Pakistani cycle of conflict.

The other national security issue both parties have been ducking is how to deal with Obama’s goals of reviving the nonproliferation system. Indian policy-makers of all stripes want to implement the US-India nuclear accord, and worry that the new US nonproliferation agenda will undercut this. But the Indian establishment does not appear to have  thought through how New Delhi might participate in an inclusive nonproliferation regime.

Whoever ultimately wins this week’s election — BJP or Congress — will have to tackle India-Pakistan relations and the US nonproliferation agenda  — the Obama administration is unlikely to give them much choice.

Text messaging played a key role in Ukraine’s Orange Revolution, but in Moldova they have gone one step further and are using Twitter to organise the days’ events. As this blogpost explains,  the most popular discussions on Twitter in the last 48 hours have been posts marked with thetag “#pman“, which is short for “Piata Marii Adunari Nationale”, the main square in Chisinau, where the protesters began their marches.

Terrible? Without a doubt. But it may also be good electoral politics. In a post in late January I mused on what US-style election consultants would tell Karzai to do:

In the run-up to the election, our consultant might say, having a another go at the international community might not be a bad idea.  Kicking out a few human-rights NGOs would be a start and then he could ban driving by women, including by foreign women. In fact, why not ban all alcohol, including for foreigners. A raid on a restaurant frequented by diplomats might make good copy. And, like in Saudi Arabia, why not try to legislate that all women — again including foreigners — must wear headscarves at all times? 

It looks like Karzai has done something very similar….

European governments have in particular failed to provide staff to civilian bodies like EUPOL, the office of the EU special representative to Afghanistan, or the NATO civilian representative’s office. And while many European governments have pushed for the UN to take on a stronger role in policy development and coordination, few have given the UN mission in Afghanistan and Kai Eide, The UN’s special representative, the necessary support, staff or resources, either in New York or Kabul.

European governments all talk about the “comprehensive approach” -– the need to mix civilian and military instruments — but in the north and central parts of the country, where I just visited (see my travel blog here), there is little evidence of such a policy. Despite the decision last year to bulk up the EUPOL mission to 400 people, actual staffing levels remain at less than half this figure, with many European countries having no personnel in the mission at all.

European governments must do better. In bullet form, they should help:

1. Safeguard the elections
2. Relaunch reconciliation
3. Improve security by training the army and police
4. Change the counter-narcotics policy
5. Target development
6. Support regional diplomacy

I develop each point in the brief with concrete ideas for European leaders to pick up. 

The EU has underinvested in the Afghan mission for years. With the coming US surge, the Afghan elections looming, and failure in the region a real danger, it needs to change course. Not only is it in Afghanistan’s interest; it is also in Europe’s.

But the call makes me come back to the issue of diaspora groups and the role they play in their “home” countries. For though Mr. Choudary’s appeal is unlikely to make much of a difference, I understand from speaking to British friends of Pakistani extraction that remittances are often sent not only to families but also for reconstruction projects in “home” villages and to political parties and movements.

In a study of party political funding, the Pakistani Institute of Legislative Development and Transparence suggested that most Pakistani political parties receive funding from abroad while many extremist groups, like Lashkar-e-Toiba, receive cash from abroad.

To varying degrees, this money — $673.50 million in December 2008 –- cannot help but encourage the centrifugal tendencies in Pakistani politics at a time when the government is facing a raging insurgency in its northern provinces and the secular Pakistan People’s Party and the big-landlord Muslim League are locked in an rancorous conflict, which may tear the country apart.

Development aid cannot make up the support from remittances to the political parties, as only a tiny proportion goes to democracy-promotion as opposed to poverty-alleviation. Out of the $278.60 million spent (pdf) by USAID in Pakistan in 2005, only $15 million were spent on governance and democracy-promotion (I’d show how much DfiD spends, if this information was not impossible to find on the department’s website). Even if more money was provided to this line item with liberal and civic-minded groups as the beneficiaries, their role in Pakistani society is limited or, in a sense, “co-opted” by the political parties.

The proactive way forward therefore seems to be to encourage a Pakistani diaspora network, which can fund liberal groups and centripetal projects in Pakistan, and rival the overseas money-collecting operation of the established political parties. Though some British government start-up cash ought to be offered, for such a network to any credibility among the diaspora and in Pakistan, it would have to be run by people of independent standing and funded in the main by non-governmental resources. But it would seem like an obvious project for many of the philanthropic organizations to back while I can think of numerous Britons (and other Europeans) of Pakistan extraction who could become powerful leaders of such a liberal project. Let us hope someone will step up to the plate and do for liberal causes what Anjem Choudary tries to do for the dark side.

But doing so at a time when the only kind of security ordinary people think about is their job security is a real challenge. As my colleague Nick Witney has said: “Defense is no longer a business of manning the ramparts or preparing to resist invasion. It has to be about an attempt to project stability. It is a hard doctrine to get people to believe in.”

To help NATO communicate better, it has hired an executive from Coca-Cola to manage the way the alliance is seen around the world and launched a an internet-based service called NATO TV as well as a Media Operations Centre (called the “MOC”) with the sole task of improving communications about NATO’s Afghan mission. 

Next week, I will attend an internal NATO meeting to discuss ways to overcome NATO’s communications challenges. And this is where you come in. I’d like to solicit the help of you, the rarified group of people who make up the Global Dashboard readership.

For I’d like to tell the assembled defence communicators what security-tracking, information-seeking, well-informed people like yourselves think are the biggest communications challenges for NATO — and perhaps how to overcome  these.

So here are a couple of questions I’d love to get your in-put on, which I will duly pass on at the NATO meeting.

1. What are NATO’s greatest challenges now and over the next five years?
2. What are the most serious threats to your country’s national security and what role do you think NATO should play in addressing this?
3. What aspect of NATO’s communications do you think works well? 
4.  What do you think of NATO TV? How can it be improved?
5. If you were in charge of NATO communications, what would you do?

I look forward to hearing what you think.