Whose Side Is Europe On?

The NATO alliance seems stronger in light of events in Ukraine and Russia. But economic competition and security may be something else. The Telegraph headlines: “Europe has picked a side in the new Cold War – China.”

In the new Cold War economy, trade will be restricted, technology fenced off, and intellectual property fiercely protected. Manufacturing capabilities will be built up, and supply chains brought closer to home to ensure resilience whatever happens.

That is going on here in the U.S. I hope it is, anyway.

As relations between the West and China deteriorate sharply, every developed economy will have to pick a side. And it is already becoming clear which one the major powers of Europe – and the European Union itself – have chosen. China.

Over the last few weeks, we have seen example after example of major industrial and commercial ties with China deepening.

Renault is partnering with Geely, presumably with the blessing of President Emmanuel Macron. Chinese investors are buying up a port in Hamburg, a crucial piece of infrastructure. And Chinese companies have announced three major new battery factories in Europe, the key industrial technology of the next decade.

More at the link, including this:

There may be lots of talk about creating a European battery industry, but in reality all the major investments right now are Chinese-owned.
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[A]lmost no opportunity is ever wasted to inflame a trade war with the US, while [the EU] steadily builds up its trading and investment relationship with China.

Maybe that assessment is too pessimistic. But a global game of musical chairs is underway, and China’s control over the large majority of key strategic materials could give it the upper hand, especially if the U.S. continues its insane policy of squandering its advantage in fossil fuels.