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Hollande and China: how will the story unfold?

By Li Xiao: 0 Comment(s)Print E-mail China.org.cn, May 31, 2012

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Wang Shuo, deputy director of the Institute of European Studies at Chinese Institute of Contemporary International Relations. [By Yang Nan/China.org.cn]

France's left wing leadership starts as Francois Hollande was sworn in as president on May 15, 2012. Hollande has all along taken a hard line with China on Sino-French trade, currency value of the RMB and human rights issues. Wang Shuo, deputy director of the Institute of European Studies at Chinese Institute of Contemporary International Relations, spoke to China.org.cn about his views on the future development of Sino-French relations.

China.org.cn: What measures do you think Hollande will carry out to improve Sino-French relations after he took office?

Wang Shuo: Hollande has never been to China, so he knows rather little about the country. As a left-wing party, France's Socialist Party tries to come up to meet voter expectations with high-flying rhetoric, which is understandable. The mutual understanding between the two countries will be achieved through a process of adaptation.

During Hollande's first two weeks in office, the president had a talk with Kong Quan, the Chinese ambassador to France, before meeting other ambassadors. Hollande said he would like to visit China as soon as possible and have a meeting with his Chinese counterpart, President Hu Jintao.

Otherwise, as early as this February, Hollande sent his special adviser, French former Prime Minister Laurent Fabius, to China before he was elected president, which shows his recognition of China as an important partner.

I don't think Hollande has decided on his China policy, since social contradictions caused by welfare reform and weak economic growth in France have become the most important issues facing the newly-elected president. In such circumstances, his foreign policy will undoubtedly work in favor of domestic affairs.

China is the biggest potential market for French products and technologies. If Hollande plans to solve domestic trouble through economic growth, he will certainly attach much importance to China.

Q: Hollande has called for trade balance between France and China on several occasions. Does it mean that trade imbalances exist between the two countries right now?

WS: Statistics show that Chinese exports to France in 2011 represented two-thirds of Sino-French trade, whose total amount reached US$54 billion to US$55 billion. France has a trade deficit with China, but Sino-French trade is getting increasingly balanced now, with French exports to China rising while its imports from there declining.

From an economic perspective, the trade deficit doesn't reflect the real economic relations between the two countries. For example, it doesn't take into account all the French manufacturing plants in China whose products will return to Europe. Those foreign investments create huge profits which will finally return to Europe even if the products are sold outside this continent.

Even if France limits Chinese exports, it will still have to import those goods from somewhere else, since it is uneconomic for France to manufacture those by itself.

Q: Hollande said that French trade deficit is rooted in the RMB exchange rate issue. What's your opinion on this statement?

WS: I think that argument makes no sense. Although Hollande may have his reasons, the appreciation of the RMB is determined by the balance of international economic and trade relations rather than Chinese policies. To change the immediate result unilaterally is to disturb the current value system of commodities.

Q: Human rights are a core value for French left-wing parties and sets boundaries for their actions. Do you think Hollande will castigate China on this issue like the U.S. does, after he takes office?

WS: France boasts freedom, democracy and human rights all along since the French Revolution. On the other hand, Chinese government is open enough to welcome all kinds of communications on human rights issue except malicious attempts of defamation and slander. China would inevitably encounter lots of problems in the early stage of development. What is important is the attitude China adopts to confront them.

The 2008 Olympic Games saw a deadlock in Sino-French relations, which reminded the then French President Nicolas Sarkozy that Chinese policies were determined by the realities in the country rather than foreign interventions. Likely, Hollande also realizes that France has very limited influence on China's policymaking.

However, as a left-wing leader, Hollande has to stress human rights and something the like to meet voter expectations. Only from more practical considerations, he uses it as a tool to bargain with China. Such bargains, which aim at compromise and cooperation instead of confrontation, are common political practices on the international political and economic stage.

Q: What attitude do you think Hollande will take over the irritations between France and China about Tibet and Dalai Lama?

WS: I don't think the Dalai Lama issue will have much influence on Sino-French relations. Hollande himself considers it more of political weight than democratic issue, saying that there is no need for him either to meet or to avoid meeting with Dalai Lama. It all depends on whether France will benefit from such meetings.

Q: Hollande suggested earlier that Europe charge extra tax over products against social security and environment protection principles, which might be a heavy blow to relevant Chinese enterprises. Do you think social security and environment protection issues will become focal points of future Sino-French conflicts?

WS: Hollande's proposal hasn't been carried out by all the European countries yet. The post-debt crisis era sees rising protectionism in Western economies, which may grow into unhealthy and lose-lose competitions among countries.

European countries, including France, boast more advanced environmental technologies than China. The real aim of Hollande's proposal is to increase the costs of Chinese products entering European market by setting European environmental standards. Recently, the EU has unilaterally imposed a carbon tax on the global aviation industry, raising opposition from around the world. The carbon tax dispute is in fact a contest between EU and the rest of the world deciding who will take leadership in the aviation industry in the future decades.

Opinion articles reflect the views of their authors, not necessarily those of China.org.cn.