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Dark clouds between Europe and the US

The upcoming arrival of Joe Biden to the US presidency seems to have generated in the European Union (EU) some hope and some positive expectations that the new US administration will repair the weakened “allied” ties between the two shores of the Atlantic. After more than a decade in which the economic weight and political role of the EU has been shrinking and degrading. The Obama administration has already focused its encirclement strategy against China trying to regain its dominance in the Asia-Pacific area, to which has subsequently been added the most solemn contempt for the EU, and the most unexpected attacks, by the Trump administration.

However, life goes the other way, at least economic life. In the third quarter of this year, China has become the EU’s largest trading partner, according to the latest data published by Eurostat, the European statistical agency. With this, China has surpassed the United States by taking away the first place. During the first nine months of this year, the trade volume between China and the EU reached 425.5 billion euros (517.3 billion dollars), while trade between the United States and the EU only reached 412.5 billion euros.

And we must also take into account that in the case of Spain, sales from our country to China rose in the same nine months of this year to 5,701.9 million euros, which means 19.6% more than in the same last year’s period. That is to say, that neither more nor less in this black year of the pandemic, and the consequent economic crisis and contraction of international trade, China has become the only great destination for Spanish exports that grows, and that is expected to exceed the maximum of 2019. And all this thanks to the rapid health and economic recovery of China, so it will be the only country that will end 2020 with growth in its GDP. It is estimated that it will be of the order of 2%.

The EU has drawn up a draft plan with the aim of rebuilding the transatlantic partnership with the US. Although the proposals cover all sectors, we must highlight the field of digital regulation and that of the fight against the Covid-19 pandemic, in an attempt to offer a new alliance of equals to counter China. A European plan to “gain strategic autonomy” and regain its own voice in the international community, and – taking advantage of the arrival of Biden to the presidency – Brussels wants to demonstrate some initiative before Washington regarding the so-called “challenge from China.” But there are structural contradictions between the EU and the US.

The main European initiative has focused on new technologies by proposing a “Transatlantic Council for Technology and Trade” to prevent China from establishing economic dominance in high-value sectors, such as 5G technology. But Europe has dragged on a serious problem for years: the lack of its own technology industry. It has a situation of dependency that entails a loss of political sovereignty and economic autonomy.

And, although there is an intense campaign in the media to place the US and China on the same plane, the EU is not in the same situation vis-à-vis these countries. The United States exercises political, economic-commercial and military domination over Europe, and intervenes continuously, directly or through organizations such as NATO, in European political life, economic progress and military activity.

Let us not forget that the economic damage caused by European technological dependence on the US has forced Brussels to try to impose a tax on US technological oligopolies Google, Amazon, Facebook, Apple and Microsoft for their monopolistic practices. The massive collection of data in Europe, the so-called “big data”, is dominated by the five technological corporations mentioned, which implies an immense power of control and places European countries in a dangerous dependency.

European companies are behind US companies -also Chinese- in the development of technologies such as 5G, artificial intelligence, semiconductors or the accumulation of people’s digital content “in the cloud” -better, in the very terrestrial giant servers of the US computer oligopolies – that is, a strategic weakness.

Semiconductors make up electronic circuits – silicon stands out – and among the ten most important companies there is no European one. The same happens with data storage “in the cloud”: there is no European company, they are American. Handing over control of European “big data” to foreign companies poses a serious threat to the sovereignty of the EU, especially considering that the United States spies not only on its enemies, but also on its allies, as revealed in 2013 by the Former US NSA agent Edward Snowden.

And regarding the 5G network, Europe has Ericsson and Nokia, Swedish and Finnish respectively, but they depend – for a complete technological deployment – on the American oligopolies. China’s Huawei is the alternative and, despite pressure from the United States, few European countries can resist Huawei’s competitive prices, especially when the United States only offers its alternative.

For this reason, the EU is accelerating the talks with China on the bilateral investment treaty (BIT) agreement – to finalize them before the end of the year – and, although it shows good will towards the United States, its own interests come first, because it cannot afford to weaken cooperation with China given the economic benefits the EU gets. In fact, a total of 35 rounds of negotiations have been carried out, the last of which took place between December 7 and 11. And the last nine rounds of talks took place this year, attesting to the fast pace.

For China, however, the Association of Southeast Asian Nations (ASEAN) has become the largest trading partner, overtaking the EU, due to the drop in trade due to the pandemic. Furthermore, trade between China and ASEAN is expected to further strengthen as China, ASEAN and other Asia-Pacific economies recently signed the world’s largest trade agreement, the Regional Comprehensive Economic Association.

The storm clouds between Europe and the United States are not temporary because they are due to a host of structural contradictions.

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