World Macron's China visit points to Beijing's shifting relationship with Europe

12:50  10 january  2018
12:50  10 january  2018 Source:   CNBC

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As French President Emmanuel Macron wrapped up his first official visit to China , there are signs that Beijing ' s relationship with Europe is shifting . The French politician' s first official visit to China is notable for coming as other leaders of the Western world struggle domestically.

XIAN, China — French President Emmanuel Macron urged Europe Monday to take part in China ’ s Silk Road revival plan, despite some European misgivings about the massive project, as he began a state visit .

a man standing next to a woman in a red suit© Provided by CNBC

As France President Emmanuel Macron wrapped up his first official visit to China, there are signs that Beijing relationship with Europe is shifting.

The French politician's first official visit to China is notable for coming as other leaders of the Western world struggle domestically. In fact, Macron appeared as "perhaps the leader of Europe at this very moment" said Philippe le Corre, a research fellow at the Harvard Kennedy School.

United Kingdom Prime Minister Theresa May, who herself has a China trip set for the end of January, continues to face questions about Brexit and her own leadership; GermanyAngela Merkel is struggling to form a coalition; and the U.S. is facing political turmoil under Donald Trump administration.

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Macron arrived in Beijing as the spokesman for a European Union that is increasingly uncomfortable with its trade relationship with China . The president' s buzzword throughout the trip was "reciprocity." The ancient Silk Road wasn't just about China , he pointed out, it was about Europe too.

Macron also called on Europe and China to team up on curbing climate change in the face of the US’ decision to withdraw from the Paris accord. “Our destinies are linked,” he said in a keynote speech on the future of Sino-French relations during a state visit to the Chinese city of Xian, the starting point

For his part, Macron is "clearly eyeing" a "special strategic partnership" with China, said Alicia Garcia-Herrero, chief economist for Asia Pacific at French bank Natixis, pointing to China's consumers grow hungrier for what France has to offer.

During his campaign, the French leader took a "slightly negative" approach to China by pushing for a European-level investment protection agency, but that development seems to have lost ground, Garcia-Herrero said.

Instead, Macron appears to be taking a different angle with China.

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Macron launched his visit in Xian, an ancient city deep in central China , historically known as the eastern starting point of the Silk Route. JLR: He does not seem inclined to do it, especially due to Beijing ' s attitude. In China , Macron urges Europe to join Silk Road project.

Macron also called on Europe and China to team up on curbing climate change, in the face of U. S . plans to withdraw from the Paris accord. “Our destinies are linked,” he said in a keynote speech on the future of Sino-French relations during a visit to the northern city of Xian, the starting point of the

"Macron seems to have come to the realization that he had better be on the right side of the table under China's divide and conquer strategy in Europe, i.e. a more accommodating stance towards China," she wrote.

As much as Macron is wooing China, Beijing is also reaching out to Europe through its ambitious Belt and Road Initiative that aims to connect Asia, Europe, the Middle East and Africa with a vast logistics and transport network.

For China, France's pivot to closer ties could be beneficial for its overall standing in Europe: A "divide and conquer" strategy will help diversify its power, as sentiment toward the East Asian giant turns sour in Germany, Garcia-Herrero added.

That shift comes as China is now producing more of its own machinery and automobiles instead of importing them from countries like Germany — and it's now even competing with the European powerhouse in third markets, she said.

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Macron began his first state visit to China on Monday, hoping to relaunch EU- China relations often strained by Beijing ' s restrictions on foreign investment and trade. "The future needs France, Europe and China ," Macron said, adding he would travel to China "at least once a year."

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Macron pursued business, downplayed deals

Over his three-day visit, Macron pursued business interests with China, but he also pushed for a reciprocal trading relationship.

That came as many in Europe are debating about the implications of Chinese investments in the continent, particularly in infrastructure and higher technology.

"At the end of the day, Europe is very open. It's more open than the Chinese market itself. Reciprocity is the key word, really. That's what Emmanuel Macron was trying as a message to convey to [Chines President] Xi Jinping," le Corre told CNBC.

On Tuesday, Macron offered to open France to Chinese investment in exchange for greater access to China's markets for French companies, Reuters reported.

"We have an access to markets which is unbalanced, unsatisfying," Macron told members of the French and Chinese business community at an event in Beijing, Reuters reported.

"If we don't deal with this responsibly, the first, natural, reaction will be to close up on both sides," he said. "Let's open up both instead."

On Wednesday, Macron said a contract with China for 184 Airbus A320s would be finalized soon, Reuters reported.

The French leader downplayed the lack of other big deals during his visit, saying other countries had trumpeted big figures in the past that masked more modest realities.

—Reuters contributed to this report.

Make reforms while sun shines on world economy: Lagarde .
International Monetary Fund chief Christine Lagarde has urged France and other countries to push through reforms "while the sun is shining" on the global economy.In an interview with France's Le Journal du Dimanche published Sunday Lagarde said the strength of the global economic recovery had taken the IMF by surprise.

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