Saturday, April 22, 2023

Brussels Edition: Dutch get hawkish on China

Europe doesn't seem to share Washington's fear of a dangerous China, but the Netherlands is changing its tune

Welcome to the new weekend issue of Brussels Edition, Bloomberg's briefing on what matters most in the heart of the European Union. Join us on Saturdays for deeper dives from our bureaus across Europe.

AMSTERDAM — Europe doesn't seem to share Washington's fear of a dangerous China, but the Netherlands is changing its tune and rethinking its ties with Beijing, one of its biggest trading partners.

Just after Emmanuel Macron visited the Netherlands to say that the EU should stay out of any possible clash between Beijing and Washington, the Dutch intelligence agency issued what was effectively a retort, warning, "China is the biggest threat to the Dutch economic security."

Beijing, of course, wasn't pleased. Chinese Foreign Ministry spokesman Wang Wenbin shot back that "relevant officials" should "stop making a big deal out of the so-called China threat story." 

Emmanuel Macron and Mark Rutte during a joint news conference in Amsterdam Photographer: Peter Boer/Bloomberg

While the EU wants to reduce its reliance on Chinese goods, Germany and Germany both say they don't want to cut off from China. Macron, in particular, has been pushing for a more independent European foreign policy amid doubts about relations with the US.

But it will take more than a state visit to convince the Netherlands of that idea. Last month, Foreign Minister Wopke Hoekstra said China would face trouble if it sent weapons to Russia for its war in Ukraine, just days after Prime Minister Mark Rutte dismissed Beijing's rise: "I don't see how this will be China's century."

The political tensions are also affecting trade ties, as the Netherlands — where chip machine giant ASML is based — has agreed to join the US effort to limit exports of chip technology to China. That followed revelations that a former China-based worker had stolen secret information from ASML. But not all the Dutch are convinced. Arjen Lubach, who hosts a late-night satirical news show, joked that Biden swayed Rutte by allowing him to sit behind his desk in the Oval Office earlier this year.

Stuck in the middle of the growing political tensions, ASML's boss Peter Wennink has pushed back against some of the limits on his company's business in China. This week, ASML reported significant pickup of revenue from China, but some of those sales may eventually be affected by the export limits.

Still, at the end of the day, national security worries won over business. "We want to make sure," Rutte said earlier this year, "that we keep the leading edge" in the chip sector in Europe and the US.

Cagan Koc, Amsterdam bureau chief

Weekend Reads

Nord Stream Blasts Remain an Unsolved Mystery Gripping Europe

The mystery attacks on the Nord Stream pipelines drastically cut the potential natural gas supplies from Russia just as everyone in Europe wanted to stop buying from Moscow. Leaders quickly figured out the blasts were deliberate, but in the half-year since, a contentious debate has raged over the question of responsibility. There's been surprisingly little public collaboration on investigations. Denmark, Germany, Poland and Sweden launched independent inquiries, as did Russia. One thing is clear: Infrastructure is an easy target.

Deepening Drought Forces Europe to Accelerate Climate Adaptation

Images captured by Copernicus Sentinel-2 in February highlighting the drought on France's Loire River. Photographer: ESA-processed Copernicus data via Bloomberg

The record heat and drought hurting European farmers, power utilities and insurers foreshadows even faster change to the continent's climate, with scientists warning that knock-on effects of a drying Earth likely will lead to dangerously high temperatures again this year. "We are really moving into unchartered territory," says Carlo Buontempo, the director of Copernicus Climate Change Service.

Endgame Nears for N. Ireland Unionists Facing World's Glare

US President Joe Biden delivers a speech at Ulster University in Belfast, to mark the 25th anniversary of the Good Friday Agreement Photographer: Chris J. Ratcliffe/Bloomberg

Northern Ireland geared up to celebrate this month as US presidents past and present flew in to join British, Irish and local leaders marking 25 years of peace since the region's violent "Troubles." But just as in 1998, the Democratic Unionist Party is frustrating progress. Its refusal to re-join Northern Ireland's power-sharing government — an innovation that lies at the heart of the peace accord and seen as a model for conflict resolution around the world — is laying bare the old divisions.

Germany Fights to Green Production of Most Important Commodity

An employee works in the blast furnace at the Salzgitter mill Photographer: Krisztian Bocsi/Bloomberg

In Germany's industrial heartland, a slender spire of tubes rises amid a cluster of smoke-belching foundries. Owned by Salzgitter, Germany's second-largest steelmaker, the installation is an ambitious attempt to revolutionize the steelmaking process, and in doing so, to secure a critical piece of the country's economy. Steel, however, is also one of the worst offenders in terms of carbon emissions.

Ukraine Pitches High Returns in Wartime Fire Sale of State Firms​​​​​​​

Ukraine is looking for investors brave enough to bet that it will beat back Russia's invasion with a simple pitch: High risk can offer high reward. The war-torn country is preparing to sell big government-run firms at distressed prices to shore up its aid-dependent budget — and end a decades-old, post-communist legacy of corruption.

Cyberwar Descends on an Unprepared Moldova

Russia's hackers have had a surprising lack of success in Ukraine, but in Moldova, Moscow and its affiliated hacking groups appear to be running roughshod over the country's relatively weak defenses. Moldovan officials say the cyberattacks and disinformation is an attempt to undermine — or even displace — a government friendly to the West in a country abutting the war zone. "They want to scare the population to infuse a constant sense of panic, of fear," says Ana Revenco, Moldova's minister of internal affairs.

Next Week in Europe

  • Monday: North Sea energy summit in Ostend, Belgium; EU foreign ministers meet in Brussels
  • Tuesday: EU agriculture ministers gather in Brussels
  • Wednesday: Ukraine reconstruction conference in Rome
  • Thursday: Austrian, German, Swiss, Luxemburg, Liechtenstein foreign ministers meet in Salzburg
  • Friday: EU finance ministers begin two-day informal meeting in Stockholm   

Like the Brussels Edition?


Don't keep it to yourself. Colleagues and friends can sign up here.

How are we doing? We want to hear what you think about this newsletter. Let our Brussels bureau chief know.

No comments:

Post a Comment

Welcome to RogerScott

Where we’re dedicated to giving you an edge in the daily markets… View in browser View in browser                                     Go...