
As Chinese investment pours into the EU, the Europeans are beginning to worry - 4684499
https://www.economist.com/leaders/2018/10/04/china-has-designs-on-europe-here-is-how-europe-should-respond
======
zekevermillion
I highly recommend Yannis Varoufakis' books, especially Adults in the Room.
Varoufakis was the Syriza finance minister who resigned when Tsipras caved to
Eurogroup pressure to accept another "extend-and-pretend" bailout (as in,
extend the debt maturity, pretend that Greece will be able to pay when it
comes due). At one point, as Varoufakis tells it, the Chinese informally
committed to provide a large investment that would have allowed Greece to
exert more bargaining power vs. the Eurogroup in debt negotiations. It was a
good deal for Greece and China, but someone in the EU bureaucracy pressured
China not to go forward with the deal -- the reason being that the Eurogroup
wanted to preserve its own power to force extreme austerity on Greece in
perpetuity.

Now of course this is just regurgitating Varoufakis' description, but I find
it rather compelling. China is only a small player in the Greek debt drama,
but it seems to me that they are one of the few friends that Greece has that
is both willing and able to play a helpful role.

(But limited by political considerations within Europe itself!)

~~~
hourislate
> China is only a small player in the Greek debt drama, but it seems to me
> that they are one of the few friends that Greece has that is both willing
> and able to play a helpful role.

Is/was their role charitable because they are nice guys? or is there something
there for them also? I would imagine that they had a long view and would have
really liked to get control of Greece as a gateway to Europe by taking
advantage of the Greek financial crisis. I don't believe China has any
friends, just business partners they cooperate with to benefit them in the
end.

~~~
zekevermillion
Yes, I'm sure you are correct. Saying a country is a "friend" is a poor
metaphor, in the world of realpolitik. But Varoufakis certainly appeared to
view China as a helpful partner, whatever state interests were advanced on the
Chinese side. Of course even "charity" in the form of direct aid is never
without strings of dependency, other geopolitical aspects.

------
hguhghuff
And Africa, the pacific and everywhere else. No doubt the long term goal is to
colonize the world.

And they’re clever enough to do it slowly, lots of small transgressions,
giving each time to be accepted before moving on to the next quiet domination.
Perfect example is taking control of the South China Sea.

And they’re smart enough to colonize in the most modern of ways...... buy the
politicians and thereby remove all possibility of government resistance.

~~~
Arn_Thor
Why do you use the word 'colonize'? That's most definitely not the aim. China
wants access to resources on competitive and secure (for them) terms, without
having to worry about governing foreign territories. (notably except the
territories China considers historically hers, such as HK, Xinjiang, Taiwan
and Tibet). China only cares about foreign governments to the extent they may
block China's ability to buy resources. But as long as China can buy the
resources it needs unencumbered it's shown no interest in domestic issues
overseas.

~~~
dgudkov
I don't necessarily agree with the term 'colonize' here, but if you buy
resources and depend on them, you would definitely want to control as much as
possible the territories the resources are coming from. Especially if they are
currently governed by weak and unstable governments. It's state-level risk
management 101.

~~~
Arn_Thor
A weak government is easy to buy. The less "skin in the game" China has, the
more easily it can buy the favor of whoever is in power. The only way China
could screw up that dynamic is by overplaying its hand through excessively
unfavorable credit terms or starting projects in said country (such as
outsourcing production) that draws the ire of the local population. Granted,
that is happening in some places

------
qubax
Sometimes it's hard to tell when propaganda begins and ends.

10 years ago, the media was scaremongering over chinese investment in brazil.
I remember thinking that china was buying brazil and then I found out that the
largest foreign investors in brazil was the US and the netherlands and china
was a distant third. Don't remember reading articles about how we were taking
over brazil or how the dutch were though.

5 years ago, the media was scaremongering over chinese investment in africa.
Oh no, china is taking over africa. Turns the largest investor in africa was
the EU by far and that european business dominated the african market. Also,
there was hysteria over china leasing farmland in africa. Turns out the
saudis, koreans and a bunch of other countries also lease land all over the
world.

Now it's the chinese investment in the EU. Nevermind that the EU is a much
larger economy than china and the EU invests far more in china than vice
versa. I mean come on.

~~~
Apocryphon
[https://thediplomat.com/2018/10/mines-money-mandarin-
china-i...](https://thediplomat.com/2018/10/mines-money-mandarin-china-in-
zambia/)

[https://www.voanews.com/a/zambia-sovereignty-concerns-put-
ch...](https://www.voanews.com/a/zambia-sovereignty-concerns-put-china-in-
crosshairs/4586797.html)

------
John_KZ
>Last year Greece stopped the European Union from criticising China’s human-
rights record at a UN forum. Hungary and Greece prevented the EU from backing
a court ruling against China’s expansive territorial claims in the South China
Sea.

Maybe if the EU hadn't forced Greece to sell their largest port to the highest
bidder they'd do better. Some German lobbyists thought they'd get it for
pennies, then the Chinese stepped in and bought it for a half-decent price.
Also Greece, Hungary and Czech Republic would be much fonder of the "European"
side (a euphemism for "Franco-German Bank interests" at this point) if they
weren't treated like second-class colonies to be milked and dumped to the
trash.

I can assure you that the cental European lobbies will abuse the periphery up
until the very last drop of patience runs out.

In this case, they lost a piece of the carcass they were tearing up because
they were too sure no other preditors were around. But if they keep pushing
the smallest countries this way, nobody will care about allegiance to "Europe"
(whatever that means) in the future. I wish the US would step in and stop them
from destroying the EU, but I guess they don't care much, which is
disappointing.

~~~
thefounder
I think the real issue is that we still talk about small countries instead of
small states with the same European citizens. There wouldn't be such a big
issue if a corporation from CA(i.e Apple) were to buy the Long Beach port or
some big factories from Detroit, MI. I may be wrong but I believe China is not
paying only for the value of the asset itself. It's also paying to get better
access to the EU market and/or even buying political support from Greece, a
kind of "strategic aquisition"

~~~
John_KZ
I have to disagree with 2 parts about your argument. One is that
centralization and capital concentration isn't a problem. The other is that
the origin of ownership is irrelevant. That's also not true.

If interests of one region buy up all the production of another, they
inevitably move all production to one place, their original base. Ports, mines
and railways are a generally an exception to a the rule, but still lots of
positions on management, engineering, logistics etc are lost in the selling
country/region and moved to the buying one.

To elaborate on the US-EU analogy:

In US, some regions concentrate more wealth and power than others, having the
majority of production and/or headquarters based there. But in the US there's
real freedom of movement. You can work in Montana one day, move to Florida the
next, and it's no big deal. The residents of economically disadvantaged areas
have to carry the burden of moving away for work, but that's the only burden
they face.

In the EU there are 24 official languages. Simply put, you can't just move
anywhere you'd like to be. Learning a new language takes many years. I've been
using English almost daily for 10+ years and I still come across new words
quite often. Primarily due to this reason, in the EU, freedom of movement is
allowed only on paper. Workers from disadvantaged areas have to take on a huge
burden if they decide to move. They have to learn a new language, a new tax
system, a new everything from workplace H&S rules to mains outlet types. Also
they often face a lot of discrimination (even if language skills aren't a dead
giveaway, ethnic differences are usually visible to us, even if they would
seem minute to an American). So essentially when a factory moves from Italy or
Slovenia to Germany, the locals lose a lot more than just the inconvenience of
having to move across a couple states for work.

~~~
thefounder
The tax system and H&S rules are not such a big issue. They are different in
the US as well. The language is an issue and without a common/EU language or
some tech innovation there is no way to fix it completely.

------
EliRivers
_The Czech president, Milos Zeman, wants his country to be China’s “unsinkable
aircraft-carrier” in Europe._

I understand a fuller quote is "an unsinkable aircraft carrier of Chinese
investment expansion". We have not yet reached the point where the ambition of
European countries is to become a military base for China.

~~~
coldtea
No, it's just the US still that has that privilege, with military bases all
over Europe and direct involvement in European politics ever since WWII (and
even before).

[https://en.wikipedia.org/wiki/Operation_Gladio](https://en.wikipedia.org/wiki/Operation_Gladio)
for some of the most shameless cases...

~~~
lev99
Most of the bases were well welcomed during the cold war. NATO has probably
done just as much to insure peace inside it's countries as the EU has.

~~~
cronz
No offence but that's just laughable. You just have to look at the Balkans
right now. Ham-fisted is an understatement.

~~~
tome
Sorry, what? One war in Europe in 70 years and somehow that's ham-fisted?

~~~
cronz
First, what makes you think there could have been other wars?

Second, do you really think that the solution that was given in the Balkans is
good? Even today, many people are deeply unhappy about it.

~~~
lev99
Europe has a long history of warfare that seemed to have halted around the
NATO. I think the presence of a strong military alliance and the presence of
peace have a high probability of being connected.

~~~
coldtea
A strong external military force, along with the devastation of European
countries with global ambitions in WWII (UK, French, Germany, and co), means
there were neither resources nor reason for war in Europe for most of the 20th
century. Heck, for most of that time Germany was still split in two.

USSRs occupation of the other half also kept "peace" there (and in conflict
between the two sides would have escalated to a full global war, which was in
nobody's interest).

Yugoslavia for example was only a state because the different nations were
kept under the same rule. When that rule was gone, 60 years of "living
together" didn't do anything to prevent ethnic tensions.

How things shape in 10 or 20 years is anybody's guess.

~~~
tome
> there were neither resources nor reason for war in Europe for most of the
> 20th century

The ambitions of the USSR were a reason for war and they had plenty of
military resources.

~~~
coldtea
> _The ambitions of the USSR were a reason for war and they had plenty of
> military resources._

Actually history has shown that they didn't.

~~~
tome
Sorry, I've lost the thread of the argument.

The original claim was that "NATO has probably done just as much to insure
peace inside it's countries as the EU has.". The counterpoint was that the
Balkan wars invalidated this claim. My response was that a single war in 70
years is hardly evidence against the original claim.

What's your line of argument here?

~~~
coldtea
> _Sorry, I 've lost the thread of the argument._

I didn't respond to the "thread of the argument" above, I responded directly
to the smaller point made in your comment.

My point regarding the whole argument is in my longer comment above.

------
illuminati1911
"Last year Greece stopped the European Union from criticising China’s human-
rights record at a UN forum. Hungary and Greece prevented the EU from backing
a court ruling against China’s expansive territorial claims in the South China
Sea. Faced with such behaviour, it is only prudent for Europeans to be
nervous."

Well that's one way of saying thanks for all those bailouts they received...

~~~
coldtea
Yeah, unemployment at 40%, massive GDP drops, German banks happy, all kinds of
anti-labour laws passed, exorbitant taxation, 5% of the most productive/young
population left the country to work abroad, political supervision, those
Greeks sure benefited much by those bailouts.

[https://eu.usatoday.com/story/money/2015/08/11/greece-
debt-c...](https://eu.usatoday.com/story/money/2015/08/11/greece-debt-crisis-
bailout-germany-benefits/31449779/)

[https://www.reuters.com/article/us-eurozone-bailouts-
idUSBRE...](https://www.reuters.com/article/us-eurozone-bailouts-
idUSBRE9410CG20130502)

[https://global.handelsblatt.com/finance/germany-profits-
from...](https://global.handelsblatt.com/finance/germany-profits-from-greek-
debt-crisis-796637)

~~~
illuminati1911
The fact that they fucked up their economy again (even with unconditional free
money) doesn't change a thing. They still received extreme economical help
from the EU and the least they could do is not cause anymore trouble. Not to
mention paying the money back.

~~~
coldtea
> _The fact that they fucked up their economy again (even with unconditional
> free money)_

Yeah, just not unconditional, not free, and no money.

They got credit (e.g. not money but another loan), under severe conditions
(e.g. not unconditional), foreign analysts have compared to those signed when
you're defeated in a war, and even IMF officials have admitted they were "the
wrong solution"), and it had to go directly to repayments (e.g. not free).

So in effect, the German-led EU paid the German banks and major private
investors holding most of the debt, with EU money, still keeping Greece in
debt (from the new credit), making some good money in the process (see linked
articles above), and imposing their economic agenda on top.

> _and the least they could do is not cause anymore trouble_

A, those pesky Greeks always causing trouble. And ungrateful at that.

Not, like e.g. a galant nation invading their country, causing the death of a
million people (including almost all Greek Jews), taking a "loan" to itself
from the occupied government it had setup, bombing Greece's ports and
infrastructure before leaving, and then refusing to pay recuperations...

~~~
YorkshireSeason

       paid the German banks and major 
       private investors holding most 
       of the debt
    

As far as I understand, see e.g. [1], the biggest debt-holders _by far_ (in
absolute terms and even more so relative to GDP) where Greek banks. The
biggest foreign debt-holders (in absolute term) were French banks. Relative to
GDP the biggest foreign debt holders were banks from Belgium, followed by
France. Moreover, Greek debt held by German banks was spread over a 11 banks,
rather than concentrated in 2 (Belgium) or 4 (France), hence less systemic
risk.

In the light of this data, I do not think it's reasonable to speak as you did
above. It was primarily a bailout of Greek, French and Belgium banks.

Aside, if Yanis Varoufakis' account is to be believed, the core reason why
Germany accepted the bailout was political and twofold:

* The governing coalition under Merkel had elections upcoming, and staked its entire reputation on the EU and the Euro. A new Euro-Critical party (Alternative fuer Deutschland AfD) emerged. It was felt that Greece dropping out of the Euro and defaulting would be seen by the voters as a vindication of the Alternative fuer Deutschland.

* Powerstruggle with France: if Germany went soft with Greece, it was felt that that would give France an excuse to tap German money even more than it already does.

[1]
[https://www.theguardian.com/news/datablog/2011/jun/17/greece...](https://www.theguardian.com/news/datablog/2011/jun/17/greece-
debt-crisis-bank-exposed)

------
alkonaut
This is what you need a union for. We have a union. So instead of a single
country being blacklisted from trade or diplomatic relations due to
criticizing China (e.g on human rights) it should just do so as a union. China
obviously can’t blacklist the EU.

A good first step would be for the EU to put its foot down and recognize
Taiwan as an independent state with full diplomatic relations. As it stands,
no individual country dares do it.

~~~
icebraining
Right, but the point is that (currently) criticizing as a union requires
unanimous approval from the member states, and some don't approve.

The article proposes changing the voting scheme to a qualified-majority rather
than unanimity, but personally I think it would be better to try to understand
why those countries are against it and work to change that, rather than
overruling them, which just reinforces the idea that the EU is a tool of a
small clique of countries to rule over the others.

~~~
AnthonyMouse
Another approach may be to use secret ballot. The issue many states have is
that they don't want to be on record supporting something even though they do,
for fear of retaliation etc. But if nobody knows how you voted, you can vote
how you want to.

~~~
LoSboccacc
that would immediately make me to switch from 'reform the eu' to 'leave the
eu', there's nothing worse than a bunch of unaccountable politician twice
removed from local issues voting secretly away from our control and ability to
retaliate by electing someone else.

~~~
mtgx
You may reconsider after watching this video on why secret ballots (or
anonymous voting in general) should be preferred over "voting transparency":

[https://www.youtube.com/watch?v=1gEz__sMVaY](https://www.youtube.com/watch?v=1gEz__sMVaY)

~~~
LoSboccacc
at most I see it as a need to introduce a bill to refund money spent on
political campaigns. secret vote at that level doesn't work, it's common for
lobbies to spend on both sides to ease a bill trough, so they are interested
more on the end result than the single vote, and as such they don't care if
the vote is secret or not, only if the final result is favorable.

~~~
AnthonyMouse
But if the final result is unfavorable, who do they punish? The entire
legislature, including everyone who voted with them? Good luck with that.

------
pjc50
Interesting how everyone was in favour of FDI when it was flowing out of
Europe and the US into Africa and South America, and now people are admitting
that the downside is loss of autonomy?

~~~
diminish
Actually copy the text of the Economist article and replace the "China" with
"Europe" and "Europe" with "Africa" or "East Europe" or similar and it will be
funny.

~~~
baud147258
Right now, you can keep China and replace Europe with Africa and it will be
still quite relevant.

------
apexalpha
2018: Greece accepts billions in loans from China, despite clear EU warnings.

2028: Greece wants help from EU after China strongarms it over loans. "Why
does the EU do nothing to help us?"

~~~
kentrado
China can't embargo, sanction or put tariff on Greece without doing the same
for the whole single market.

------
dakics
Interesting overview of China as "an island."

[https://worldview.stratfor.com/article/geopolitics-china-
gre...](https://worldview.stratfor.com/article/geopolitics-china-great-power-
enclosed)

------
tw1010
Huh. Is it really valid to think of investment or cash as tainted by the norms
that they originate from, affecting the characteristic parameters of the
system it flows into (norms of the institutions and people in the EU)? In what
manner is it valid to think of the trojan-horse-cash as spreading, like a
dirac pulse which only affects the first node touched by it (the person or
institution who gets the cash), or as something with a long half-life, which
spreads widely and with a lot of influence once in the system?

~~~
Gokenstein
Just like gravity, its not the influx of cash that causes fear, its the sudden
stop at the end.

------
navigatorSL
In Portugal we sold our electric grid and production. Lol.

~~~
marcosdumay
In Brazil we sold our electric grid, and it was great!

We also leased our production and we got ripped off by politicians.

Basically, YMMV, as the details matter much more than the large picture here.

------
kodablah
> Some Europeans take this to suggest that China is a useful counterweight to
> an unpredictable Uncle Sam. That is misguided.

Although misguided, it is quite easy to understand citizens' anti-Americanism
which is borne out of effects they experience compared to China's relatively
domestic-only policies. Right or wrong aside, this has always been the cost of
globalism and projection. I don't think it helps to present it as an either-
or, weight-counterweight situation (which the article doesn't do and is
warning against of course).

> Transparency should be demanded [...]

I've found this is just too much to ask anyone dealing with China. I don't
care if you're Marriott or Apple or a politician or whoever, the leverage of
an entire country weighed against your ability to even disagree publicly is an
unfair fight. Sadly, if you want to demand transparency you are in effect
forcefully removing a market. Consumers and journalists are going to have to
just continue naming and shaming, which does little good, until that
transparency is demanded of the true oppressor.

> That is misguided [...] however much Europeans may dislike the occupant of
> the White House.

> Ideally the Trump administration would stop treating Europeans as free-
> riders on American power who deserve a good kicking.

While ideal, sure, I think the author should heed their own thoughts on not
focusing too much on the current occupant. In general US policy has no anti-EU
slant (though the inverse seems less true).

------
derEitel
I have not read a single economist.com article in the last couple of months
but the paywall tells me I've reached my limit. How badly can your paywall be
implemented? This is I guess the most disencouraging thing from me getting a
paid subscription.

Anyone else having the same issue?

------
expertentipp
The future is agreeable and unanimous.

------
gonvaled
Ah, cool, China bashing in HN again. These kind of things usually drop out of
the homepage in seconds, if it is US- or UK-related, with the usual off topic
arguments.

Let's call it as it is: HN is a political instrument for anglocentric views.
Not a particularly strong one, since topics are usually not about politics,
but biased nontheless.

Which is fine, but let's stop denying it.

~~~
krapp
>Let's call it as it is: HN is a political instrument for anglocentric views.
Not a particularly strong one, since topics are usually not about politics,
but biased nontheless.

...but most of this thread is "bashing" the US and EU.

The best you could say about HN is that it hosts a pro-China contingent and an
anti-China contingent, each of which believes the site is biased towards the
other. But the site itself and the userbase is too diverse to be accurately
labeled one or the other.

~~~
gonvaled
> The best you could say about HN is that it hosts a pro-China contingent and
> an anti-China contingent, each of which believes the site is biased towards
> the other. But the site itself and the userbase is too diverse to be
> accurately labeled one or the other.

I would argue that your pro-China camp does not exist. Those who criticize the
US (myself included) are perfectly aware that China is not a role model.

We simply refuse to accept the view good (US) vs bad (China / Russia,
depending on the weather). And we argue that the US has a much bigger
footprint on geopolitics. both good and bad. And we criticize the bad parts,
of which there are plenty.

~~~
keymone
> we argue that the US has a much bigger footprint on geopolitics

and by reducing that footprint (which is the main purpose of the critique) who
do you think is in the best position to fill the vacuum? and what is the net
effect of such change (good vs bad)?

> And we criticize the bad parts, of which there are plenty.

so you won't start criticizing China until US becomes the perfect utopia? how
convenient..

------
ch2521482
Pity. Your worries actually come from not facts, but imagination. Just replace
China with US in those sentences, much less worries will be arisen.
Furthermore, there's no facts about China's threat emerging yet, compared to
US/NATO's several military operations against quite a few sovereignties, and
numerous military bases all over the world, which ensure their bombs to blow
your bedroom wherever you are within 1 hour. Just be honest to your heart. You
feel worries merely because they are yellow while you are white, and that
uncomfortableness needs some time to be relieved.

~~~
T-A
No, we "feel worries" because "they" are an authoritarian party-state whose
record on little things like freedom of speech, rule of law and human rights
speaks for itself - and that's when it's dealing with its own citizens.

~~~
dsfyu404ed
Exactly. The US is willing to prop up some pretty brutal despots in the name
of stability or access to resources. China is going to be as bad or worse. The
actions of the Chinese government overseas are not nearly as constrained by
the need of partial approval or lack of disapproval at home the way the
actions of the US are. Someone like Pinochet wouldn't even give China pause.

