France and China: a threefold betrayal of General de Gaulle's legacy

This article was first published in l'Opinion" on 13th may 2023

Xi Jinping's visit was the meeting of two presidents with incompatible visions of the world and the economy – they turned a deaf ear to each other.

?

On leaving France after his short stay, Xi Jinping must have felt most gratified, since the status quo that he finds so satisfactory had been maintained: China will continue to benefit from an annual trade surplus with Europe of over €300 billion, whilst paying a derisory price for Russian hydrocarbons in return for supporting Russia in the war in Ukraine. This setback for Emmanuel Macron is due to his failure to observe the three guidelines laid down by General de Gaulle in 1964 when officially recognising the People's Republic of China.

?

Firstly, “to see the world for what it is”: 2022 was the year of a break between generations, ending a 30-year cycle of freedom that had begun in 1989. Two events triggered this: firstly, the Ukrainian conflict, which brought about an unprecedented transfer of value from Russia/Europe to China and the United States; secondly, the 20th Congress of the Chinese Communist Party, which contaminated 20% of world GDP with the “neo-Marxist-Leninist” virus.

?

To put it another way, this is an extraordinary time, illustrated in President Macron's lengthy speech at the Sorbonne when he said that Europe was mortal. But the meeting that came ten days later was simply ordinary. Each president turned a deaf ear to the other, like in the ludicrous Chinese denial of excess industrial capacity. The two presidents are simply not living on the same planet. Xi Jinping has headed up a “war economy” ever since he came to power in 2012, prioritising Western dependence on “the Workshop of the World” rather than rebalancing growth through domestic demand. Emmanuel Macron, on the other hand, refuses to see the world for what it is, and continues to live in a “peace economy”, increasing the public debt in order to artificially maintain the demand of the inactives. In this way, he is blocking any hope of European cohesion, leaving an open playing field in which the Chinese can exercise their subtle art of dividing the enemy.

?

General de Gaulle took pains to underline that the restoration of diplomatic relations was “in no way a sign of approval of the regime that governs China

Systemic rivalry

?

Secondly, General de Gaulle took pains to underline that the restoration of diplomatic relations was “in no way a sign of approval of the regime that governs China”. Likewise, President Xi Jinping in 2024 is no longer the same as he was in 2019 when he last visited Europe. In 2022, the 20th Party Congress gave its blessing to state control – whether direct or indirect – over private capital, whose level is now merely stable. The result is a systemic rivalry with the West, which the United States recognised on 7th October 2022 when it cut off China's access to American high-tech. Europe, on the other hand, has still not gone along with Henry Kissinger's recommendation that the red lines not to be crossed must be specified. And yet, two would seem pretty natural. Firstly, any “neo-Marxist-Leninist” imports that have benefited from undeserved state subsidies should be taxed. Secondly, any carbonaceous product should also be taxed since Europe has chosen to follow the costly policy of creating the most sustainable ecosystem in the world.

Europe's lack of courage is particularly incomprehensible given that it had been able to identify its “systemic rivalry” already back in 2019?

Europe's lack of courage is particularly incomprehensible given that it had been able to identify its “systemic rivalry” already back in 2019; and because the lack of consultation with China in the American approach has not negated the paradoxical existence of a new Cold War alongside with a “ChinAmerica” trading $700 billion every year. Deprived of access to 21st century digital high-tech and to private capital, and with no increase in domestic consumption, any Chinese growth in the future will be limited to the upgrading of mature 20th century industries – cars, aeronautics, machine tools, chemicals and basic pharmaceutics. Today, the above sectors are in the hands of leading European companies, and this heralds the inevitable rise in tension – both commercial and political – between China and Europe. Like a canary in a coal mine, the absurd prospect of cognac being taxed for dumping – undoubtedly our most profitable export to China – bears an unhappy warning.

?

Thirdly, General de Gaulle showed his legendary vision when he said that “there should be more direct contact between peoples, as this will foster wisdom, progress and peace.” On the other hand, President Macron's dangerously narcissistic nature led him to center the communication from the Elysée exclusively around a presumed “special relationship” that would be established between the two presidents.

?

Autocrats do not usually give in to seduction, and the smiles exchanged in the rainy Pyrenees are bound to have transformed the would-be seducer into a beguiled suitor, as was the case in Canton a year ago. If President Xi Jinping has a “special relationship’ with anyone, it is with Vladimir Putin, whom he has met on average once every three months since he came to power.

?

It would without doubt have been better to highlight the ties forged over the past twenty years, since China joined the WTO in 2001, with our three principal friends in China. Firstly, these are the private entrepreneurs whom we have helped in building up their supply chains, now acting in almost a third of all world trade. Secondly, these are the heads of local authorities, the real kingpins of partnerships between the private and public sectors, and the basis upon which Franco-Chinese cooperation has been built over the last two decades. Thirdly, these are the young people, now resigned to “lying flat”, who, as scions of one-child families, are desperately seeking alternative families such as the virtual communities that have grown up around our luxury brands.

“If President Xi Jinping has a “special relationship’ with anyone, it is with Vladimir Putin, whom he has met on average once every three months since he came to power.”

?

A wasted meeting

This wasted opportunity of making history is all the more frustrating as, in China, there is a particular connotation associated with sixty years. They correspond to the traditional sixty-year cycle bringing in a new era, which this meeting should have attempted to construct – this being made possible by a friendship “with limitations” enabling any real problems to be raised in a direct manner, similar to the one that Alain Mérieux – the only French person in a position to claim a “special relationship” with President Xi – has managed to build in China over half a century.

?

“Amicable” plain speaking would have made it possible to express France's concern with regard to the – first-ever – threat of deflation that appeared in China in 2024; the same threat that has faced Japan over the past three decades. As a “friendly” advisor, President Macron should have drawn President Xi Jinping's attention to the fact that the financial markets expect that, over the next decade, China's growth rate will only be half that of the United States – just over 2% per year – which makes it unrealistic for China to aim at catching up the US by 2049.

?

As a final point, Emmanuel Macron should have reminded his opposite number that for China to aim at self-sufficiency is not only not in its own interest, but also obliges French companies to prioritise alternative strategies such as “China + 1”. Decoupling is in the East, while forced Derisking is in the West.

?

In the past, the West made the mistake of underestimating China when it opened up. Now it must not overestimate China as it closes up. President Macron chose a strange time to talk about a “mortal” Europe a few days before the meeting, for this weakened his position. In hindsight, the rather baroque duo of “good cop, bad cop” with Ursula von der Leyen seems an equally bad choice, for we saw already its limitations last year in the trip to Beijing.

?

It would have been more effective to invite “Super Mario Draghi”, the saviour of the euro in 2012 and, today, the only European with the stature to reshape Brussels' disastrous governance. The “radical change” he has called for is aimed at reworking Europe's interdependence with China and with the United States, which should have been the subject of discussions with President Xi Jinping. It would also have had the advantage of paying a final homage to the memory of General de Gaulle.