Significantly, Germany's Merkel and Foreign Minister Frank-Walter Steinmeierhave declined to take part in the opening ceremonies while French PresidentNicolas Sarkozy has not made up his mind yet. Britain's Gordon Brown will onlyattend the closing ceremonies and fulfill ceremonial duties, given that Londonwill host the 2012 Summer Olympics.
Germany's stance on China is especially confused. The EU's largest economyrelies heavily on exports to China--worth 27.5 billion euros last year--butmembers of the ruling grand coalition of Social Democrats and ChristianDemocrats are at odds over how to deal with Beijing. Merkel has taken a tougherline on Beijing than her social democratic predecessor Gerhard Schroeder. Herdecision to meet the Dalai Lama in her office last September cast a chill inGerman-China relations. Aides say the chancellor has not spoken with PrimeMinister Wen Jiabao in several months.
Germany's social democrat Foreign Minister Frank-Walter Steinmeier, however, istrying hard to mend fences with Bejing and has held two meetings with Chinesecounterpart Yang Jiechi, making it clear he opposes a boycott of the Games.German business leaders press for a thaw in Berlin-Beijing ties, but Berlin alsorecently suspended talks with China on climate change and renewable energybecause of events in Tibet. As such, rebuilding trust between the two countrieswill not be easy.
While Germany blows hot and cold on China, the voice of pro–free trade EUstates like Britain and the Netherlands is drowned out by southern Europeannations, including Italy, which worry about rising trade competition from China,and eastern EU newcomers, which add their weight to Nordic concerns over humanrights.
EU officials complain that China’s lukewarm response so far to key EU demands,including Mandelson's repeated warnings that the rapid rise in China's tradesurplus with the EU--which grew by 21 percent last year to reach a record 159.2billion euros, or US$251 billion--is not making their task of fightingprotectionism any easier.
China must provide the EU with "a good news story" on trade and humanrights, they say, to prove that engagement and constructive dialogue are worththe effort. As such, Brussels is hoping to launch a so-called "high-levelmechanism" on trade at the meeting in Beijing to discuss issues likeimproved protection of intellectual property rights and product safetystandards.
EU Monetary Affairs Commissioner Almunia, meanwhile, wants Beijing to stopfocusing on the yuan’s exchange rate with the dollar and also allow itscurrency to appreciate faster against an ever-stronger euro. In addition, the EUhas complained about China's neglect of governance standards in pursuit ofenergy resources in Africa while several EU governments, heeding US warningsabout the rise in China's military budget, have indefinitely shelved plans tolift an EU arms embargo against Beijing.
European governments' inability to speak with one voice on China diminishes theEU's clout. The EU says it demands that Beijing talk to the Dalai Lama areprompted by real concern that discontent in Tibet could spread to otherprovinces and a longstanding European belief that a more open society, withbetter protection of human rights and the rights of minorities, is in China'sinterest. But China is unlikely to pay heed to advice, however wise andwell-intentioned, delivered by a divided and weak Europe.