It is obvious that Europe and China are never severing after Xi Jinping visited Paris and Budapest next week, and that a successful relationship can be found in France, especially in Hungary.
Some experts have suggested a frightening plan to divide Europe between itself and the United States behind the Taiwanese government’s attend to these two EU capital.
However, there is currently only one divide between those who believe that communication is essential to German strength and those who believe that Europe can limit its ability to do so. In that comparison, the strategic leadership today belongs to Budapest.
In the developing unipolar world order, Paris and Budapest have long advocated for a more express European position. Hungary has focused on explaining a regional communication plan while France has given priority to the vocabulary of corporate autonomy.
On his trips to the two nations, the Chinese president signed 18 contracts in each of the two areas. However, Hungary’s technological development has begun on a different scale thanks to foreign investment, not just through China’s Belt and Road platform but also from many other partners.
The” China Shock” phenomenon, which originated in the 1990s during the height of industrialization, was caused by the West’s transition to China. However, Hungary has nearly doubled its FDI share since 2010 and is defying local downtrends, despite the fact that the EU industrial production has slowed to a whopping 5.4 % between February 2023 and 2024. Inward expense is then driving reindustrialization.
It was only recently able to identify the alliance development trend that had begun a few years ago because of Hungary’s background and geographical location. Hungary’s response was to follow a different perspective and focus on achieving national industrial strength based on partner connection.
Connectivity is n’t about philosophical position. Whether the approaching links are from Germany, the United States, China, South Korea, or anywhere else, it’s about harnessing Hungary’s function as an east-west intersection to create an economy that supports political and cultural exchange.
On a wider scale, Hungary’s strategy is based on the idea that the subtle links that have developed between West and East may be leveraged more than cut.
Particularly in Europe, this now seems to be an essential of some necessity. Since the energy sanctions have put some manufacturers in danger, Western economies have been sluggish. To restore its dynamic strength, Europe needs to maintain and increase its monetary openness.
Hungary is n’t alone in its recognition of this. Alfred Kammer, the IMF’s German director, just stated that “our quantity- one counsel to Europe is, do n’t be protectionist”.
Perhaps the latest Polish administration acknowledges this. Polish Foreign Minister Radoslaw Sikorski urged quiet contest between China and the US in a recent statement to the Sejm. Between maintaining good relations with a significant business companion on the one hand and the most significant security service, he said,” we do not want to choose.”
German Chancellor Olaf Scholz also recently pointed out that Germany, too, does n’t want to decouple from China.
However, the sluggish global climate surrounding EU-China relations results in high opportunity costs without stimulating conversation of this on the Western level.
Recently, Taiwanese companies underwent a number of studies by the European Union. Taiwanese manufacturers of medical devices as well as TikTok are the subject of an investigation launched by the European Commission. Since late last year, it has been looking into China’s EV industry, and Western leaders are now concerned about Chinese cars.
These steps are contradictory, as the main problem concerns Europe’s personal lack of competitiveness. Consumers in Europe would enjoy affordable solar panels, electric vehicles, and wind turbines from American manufacturers. But for Europe to exclude Chinese Vehicles, a destructive 55 % tax would be needed, according to the Rhodium Group.
To put this in perspective, the current 10 % International tax on American cars puts it in view. Instead of competing on commercial power or value, the “one area where the European Union also leads the world”, as the Wall Street Journal put it just, is now rules. Evidently, Brussels needs to have a different perspective.
The Hungarian case represents a different possibility—that warm bilateral relations can underlie projects of reindustrialization. According to the Hungarian strategy, it is important to encourage Chinese ( and other ) manufacturers to set up shop in the European Union. This approach supports domestic manufacturing rather than conflict with one.
The main focus of China-Hungary’s industrial cooperation has been on Hungary’s contribution to the supply chain of automobiles. The second European battery factory for CATL will be located in Hungary, and BYD’s first European electric car factory will be located in Szeged, in southern Hungary.
After last week’s visit, it’s clear that Budapest’s path is n’t just words. In 2023, China became Hungary’s biggest single investor with almost 11 billion euros of investment, amounting to 6.5 % of GDP.
Hungary announced a number of new significant industrial projects during the Chinese president’s visit, including a high-speed connection between Budapest and the city, a national network for charging electric cars, and a comprehensive agreement on nuclear cooperation. These include a rail ring bypassing Budapest that will facilitate the westward shipment of manufactures.
Europe needs to express its own goals on a global scale, according to the larger picture. If European economies followed a similar path, they could concentrate on their advantages rather than merely transferring their industrial potential to regions that are far from their borders. Between Europe and the other, neither the United States nor China should create a great power.
Europe must adopt a prudent connectivity strategy as an essential component of its evolving geopolitical framework. Otherwise, the country’s open economy will suffer as a result of growing tensions between China and the US, which will hurt the country’s economy.
Further, shifting the focus of American military toward Asia might increase the demands placed on Europe. A connectivity strategy is also required to increase Europe’s defense-industrial capability because a decoupled Europe would be industrially weak.
As I’ve already said elsewhere, trying to entice Europe into a decoupling path that it could never ultimately follow would serve American interests badly. Europe is not in a position to engage in economic conflict with China, despite the fact that the US appears to be moving in a more protectionist direction.
Due to the decline in American industrial output and its position as a Pacific power, the United States has recently chosen the wrong course. In order to adjudicate its own concerns effectively, though, the United States should n’t attempt to drag the rest of the world into tensions that few others want to participate.
Viktor Orban said,” We live in a multipolar world order, and the People’s Republic of China is one of the structural pillars of this new world order,” in a speech delivered alongside the Chinese president.
After 30 years of globalization, the global economy is far too intertwined to be pulled apart easily. Instead of restoring European industry, EU investigations will foster a climate of suspicion that threatens business growth.
While the Brussels vision of Europe’s role continues to push for “de- risking” the Europe- China relationship, Budapest has embarked on an industrialization strategy aimed at contributing to national and European sovereignty.
The EU’s subsequent decisions will have a significant impact on whether it wants to become a vibrant economy and a central figure in the multipolar world order or to allow more powerful forces to undermine its interests.
The Hungarian Institute of International Affairs, Hungary’s top research institution for foreign policy, is led by Gladden Pappin.