Author:
Peter Leavy

Evolving European Indo-Pacific Policies – Good for Australia

Synopsis

While AUKUS and the nuclear submarine agreement have amplified Australia’s role in the Indo Pacific, Europe is also asserting a greater interest in the region that could well determine a new international order.

On 16 September 2021, Australia’s Prime Minister, in conjunction with his UK and US counterparts, announced the creation of the ‘AUKUS’[1]security framework, which will see greater collaboration between the three countries, including a path for Australian nuclear submarines.  Somewhat lost in the excitement, the European Commission released ‘The EU Strategy for Cooperation in the Indo-Pacific[2] on the same day, which built upon proceedings published in April 2021.[3]

The EU Strategy articulates a significant shift in European thinking, away from a hedging policy to one concerned with China’s rising power and its attempt to reinterpret global rules and norms. China’s modest, but useful, European assistance during the 2008 Global Financial Crisis helped foster goodwill between China and Europe at the time, however, there has been a rethink in recent years. China’s island-building and territorial ambitions in the South China Sea raised initial concerns, and then China’s early handling of the COVID-19 outbreak and the cancellation of some key supply contracts highlighted the clear dependence Europe has on China.[4]‘Debt-trap diplomacy’, economic coercion and sanctions applied to those critical of China’s human rights record have all further driven this shift in thinking.

While it is in everyone’s interests to work with China as a legitimate rising power, it’s also important to have a collective approach to upholding the rule of law. The European pivot in this endeavour, as outlined in the strategy, is not only welcome but vital. This article reviews evolving European policies towards the Indo-Pacific and the increasing naval engagements that several key European countries have embarked upon, and what this may mean for Australia.

But first, a caveat. While the establishment of AUKUS is a significant boost to Australia’s security, there are second-order effects to consider. Key amongst these is the practical manifestation of European engagement in the Indo-Pacific. Given the EU Strategy was released without knowledge of AUKUS or the cancellation of Australia’s SEA1000 submarine contract with Naval Group, the extant French foreign and security policies, and potentially those of other European countries, may shift in the coming months. While the relationship between Paris and Canberra is somewhat cool at present, France has significant interests in both the Indian and Pacific Oceans, so their long-term commitment to the region is solid.  However, their approach in the short to medium term, particularly in relation to Australia, remains to be seen and will require careful diplomacy and management.

Tensions and uncertainty across the Indo-Pacific have risen over the last few years. Some resident countries, including Australia, have voiced concern over China’s aggressive policies, even when it has come at a cost. The current Chinese economic actions against Australia and the refusal to engage politically are prime examples of that cost. This growing uncertainty has seen an increase in naval activity in the region.

As of September 2021, there are six naval task groups operating across the Indian Ocean and Western Pacific: The USS Carl Vinson Carrier Strike Group; the USS America Expeditionary Strike Group; Britain’s HMS Queen Elizabeth Carrier Strike Group (CSG-21 – which includes ships from the Netherlands and US); the Japanese Maritime Self Defence Force Indo-Pacific Deployment 2021; the Indian Eastern Fleet Task Group; and Australia’s Indo-Pacific Endeavour (IPE 21).  Given the EU pivot, it is also interesting to note that Germany has deployed a frigate to South-East Asia for the first time in 20 years

European Union

EU-China trade is valued at a billion euros a day, so Europe has significant and genuine economic interests at stake.[5] As the EU Strategy shows, however, there are signs that Europe is increasingly focussed on geopolitical as well as economic considerations. This shift in thinking is clear, but has been gradual. A European Commission report in March 2019 attempted to strike a balance, stating that:

 ‘China is, simultaneously, in different policy areas, a cooperation partner with whom the EU has closely aligned objectives, a negotiating partner with whom the EU needs to find a balance of interests, an economic competitor in the pursuit of technological leadership, and a systemic rival promoting alternative models of governance.’[6]

In September 2020, the UK, Germany and France jointly submitted a Note Verbale to the United Nations, recalling the 2016 ruling by the Permanent Court of Arbitration on China’s actions in the South China Sea; further evidence of increasing concern over geopolitical issues.  However, this shift has been tempered.

In December 2020, after six years of negotiation, the EU Commission (under German presidency) signed a bilateral trade and investment agreement with China known as the ‘EU-China Comprehensive Agreement on Investment (CAI)[7]. The negotiations were protracted over concerns around human rights and labour provisions.  The compromise reached was that China would ‘make continued and sustained efforts on its own initiative ...[8] to ratify the International Labour Organisation conventions—a relatively toothless clause which Axel Berkofsky argues shows Germany’s influence over the EU Commission in allowing ‘business to rule over principles’.[9]  While some German policymakers are focusing on geopolitical issues, pressure from large German multinational corporations who have significant financial interests in China has left Germany the most cautious of the major European countries about antagonising China.[10]

That said, the September 2021 EU Strategy does demonstrate a more strident position against China’s increasing assertiveness. While not singling out China, it is telling that the document’s principles include defending the rules-based international order, promoting democracy and human rights and ensuring a level playing field regarding trade and investment.  It also discusses China’s military build-up in the South China Sea. The clear message throughout the strategy is a desire for Europe to diversify away from dependence on China across a range of issues while remaining engaged where it is logical to do so.

Like many individual countries within Europe, the EU strategy focuses on ASEAN as the main vehicle for engagement. This perhaps represents a transplanting of Eurocentric thinking into Asia.  Key strategic and economic agreements in Europe–-NATO, the EU etc—have a common purpose or threat around which all members unify. While Asia may be moving in this direction, multilateral fora in Asia, including ASEAN, have been characterised by different and often competing interests with no common, clear threat to rally around. ASEAN is famous for its consensus decision making and avoiding interference in other member states’ affairs. Asian decision making is generally less clear-cut and more indirect than European/Western approaches; something even Australians sometimes forget.

That said, the country-specific policies and announcements by European leaders show a tendency to increasingly form coalitions of ‘interests’ (rather than just ‘alliances’) with key partners to tackle common challenges.  Both France and the UK have, for instance, expressed a desire to cooperate with the Quad, and AUKUS is exactly this type of ‘interests based’ agreement.

France

The European country with the strongest links to the Indo-Pacific is France, which has one of the largest EEZs in the world, two-thirds of which is in the Pacific. France has 1.6 million citizens (including 8000 French military personnel) living in the Indo-Pacific, and with territories in the Indian, Pacific and Southern Oceans it’s not surprising it’s the most engaged European nation.  Earlier this year France deployed the Mistral Class LHD Tonnerre and Frigate Surcouf to Asia, which included visits to Japan, Vietnam and Singapore. The French nuclear submarine Emeraude visited HMAS Stirling in November 2020 before deploying into Asia and exercising with the JMSDF; a first. The French aircraft carrier, Charles de Gaulle, deployed to the Indian Ocean earlier in 2021 supporting operations in the Middle East and working with the Indian Navy. In 2019 the carrier also deployed to Asia, exercising with Australia, the US, India, Indonesia, Malaysia, Japan and Singapore.

Until the mid-2010s, French policies in the Indo-Pacific sat comfortably within the reality of US dominance, so they had no need for a dedicated Pacific strategy. However, Chinese challenges to global norms and the relative decline of US power has seen the strategic risk to French interests rise. This led France to develop a specific Indo-Pacific strategy which was launched by President Macron in 2018 at Fleet Base East, in Sydney. Macron spoke of an ‘axis of cooperation between Canberra, Delhi and Paris’ and sought to position France as a balancing power in the Indo-Pacific[11], although it is not clear exactly how France can balance either the US or China. The strategy was updated in 2020[12] and recognises that the Indo-Pacific is fundamentally maritime.  Given the breadth of French Indo-Pacific responsibilities in relation to the resources available if those interests are challenged (mindful that French territories are relatively weak economically and rely on Paris for security), France is seeking greater cooperation with like-minded partners to help shape the environment.  Their strategy promotes multilateralism and identifies France’s key regional partners as India, Australia, Japan and the United States, although relations with Australia may cool for the immediate future in response to the cancellation of the SEA1000 contract.

Germany

The other major European Union power is Germany, which released its ‘Policy Guidelines for the Indo-Pacific’ in 2020.[13]  Of the European countries discussed, Germany is the least robust in shifting from an economic perspective to a geopolitical one, although the trend is still evident. The Policy Guidelines recognise that ‘[14]  Like the other EU countries, Germany focuses on ASEAN as the vehicle to engage with the region. It is the only ‘ASEAN Development Partner’ in Europe and has applied for observer status within the ASEAN Defence Ministers’ Meeting Plus (ADMM+) forum, but also recognises that Asia does not have the same cohesion and common purpose that European institutions do.  Their Policy Guidelines are also overly optimistic that the conclusion of the Code of Conduct between China and ASEAN can resolve South China Sea tensions. This code has been under negotiation for many years and is unlikely to ever be concluded given the potential to limit Chinese ambitions. 

Overall, Germany remains wary of antagonising China, focusing on non-traditional security threats over hard security and military cooperation, and not mentioning either Taiwan or China’s growing role in public disinformation; two key elements of instability and tension.

At the time of writing, the German Frigate Bayern is deployed to the Western Pacific, the first such deployment in 20 years.  While this is a practical manifestation of Germany’s increasing priority on the Indo-Pacific, indications of hedging remain. In the lead-up to the deployment, Germany followed France and the UK in instigating ‘2+2’ Defence and Foreign Minister meetings with Japan where the Japanese proposed a joint naval exercise.  To date, it does not appear this offer has been taken up despite having a ship in the region. Germany also publicly announced that Bayern would not sail within 12 miles of any Chinese claimed territory and requested a port call to Shanghai prior to any South China Sea transits.  Despite these attempts to avoid antagonising China, Chinese authorities sought information on the rationale for the ship’s deployment before approval for the port visit would be given; approval that was, in the end, denied.[15]  Of further interest is the ship’s route, as it currently precludes any interaction with the Royal Navy’s CSG-21 deployment—an opportunity wasted.[16]   Arnaud Boehmann argues that the Bayern’s deployment is more aimed at strategic messaging for regional allies—Japan, Australia and the US, as well as France and the UK—
than it is in deterring Chinese assertiveness.[17] With recent elections in Germany, it remains to be seen how the German approach to the Indo-Pacific will progress.

UK

After leaving the EU, the UK has embarked on a policy of ‘Global Britain’, best articulated in their review ‘Global Britain in a Competitive Age’ released in March 2021.[18]  This review highlighted a shift in British focus towards the Indo-Pacific with a view to making Britain ‘… deeply engaged in the Indo-Pacific as the European partner with the broadest, most integrated presence in support of mutually-beneficial trade, shared security and values’.[19] The review identifies four key changes impacting Britain’s security: Geopolitical and Geoeconomic changes such as China’s increasing assertiveness and the shift of the global centre of gravity towards Asia; Systemic Competition, both between nation-states and, at the philosophical level, between the democratic and authoritarian forms of government; Rapid Technological Changes; and finally, Transnational Challenges such as climate change, terrorism and biosecurity threats.[20]

The Global Britain narrative is one of greater independence following Brexit. It is telling that the first major deployment of the Royal Navy’s new aircraft carrier, Queen Elizabeth, is to the Indo-Pacific. Not only does this send a strategic message, it also shows a high degree of confidence in the capability for it to be deployed and supported halfway around the world in its first major deployment.

In addition to Queen Elizabeth, Britain’s Carrier Strike Group includes British destroyers, frigates, auxiliary ships and a nuclear submarine, plus a Dutch frigate, a US destroyer and US Marine Corps F-35B aircraft as part of the embarked air wing. Britain is actively cooperating with like-minded partners having exercised with the Carl Vinson Strike Group in late August and with the JMSDF.  HMS Richmond, a frigate within the task group, also sailed through the Taiwan Straits in late September, making Britain one of the few countries to undertake such a passage in recent years.  (China responded that Britain ‘harbours evil intentions’.[21])  Britain’s key role in the AUKUS framework also draws it closer to the United States and the Indo-Pacific region with media speculation that the Royal Navy may rotate nuclear submarines out of Australian bases.

While much has been made about AUKUS and Australian nuclear submarines, European cooperation in the Indo-Pacific is vital and will become more so in the years ahead. Recent developments in Europe show a trend towards greater direct interest in the region, however, Europe will remain challenged to devote significant resources to the other side of the globe if there are more direct challenges closer to home. We are seeing a shift towards coalitions of ‘interests’ rather than ‘alliances’, which is understandable as strategic circumstances deteriorate.Direct national interests take a higher priority over support to others in times of uncertainty (not a criticism, a reality), so where interests align it is natural that coalitions of interests will form. AUKUS has aspects of this, notwithstanding the longstanding alliance and operational histories between our three countries—
the envisaged outcomes of AUKUS directly benefit all three countries.

The strategic competition being played out in the Indo-Pacific must be billed as a ‘rule of law’ issue rather than a ‘China versus US’ one, and European countries are a key element in this narrative. So, while many are caught up in AUKUS and nuclear submarine discussions, it is imperative that we understand the global changes underway and how they will impact our region.  Increasing European naval interest in the Indo-Pacific is in Australia’s interest and will be an important part of forging ‘alliances of interests’ with a wide range of partners, and in countering the ‘China versus US’ narrative.

Biography

Commodore Peter Leavy is the Commandant of the Australian Defence Force Academy.  A Principal Warfare Officer, he has served widely at sea, including command of HMA Ships Stuart and Sydney.  He was also the Director of the Sea Power Centre - Australia and served as both Commodore Warfare and as Australia’s Naval Attaché to the US.

[1] Australia, United Kingdom and United States.  See Joint Leaders Statement on AUKUS, 16 Sep 21, available at https://www.pm.gov.au/media/joint-leaders-statement-aukus (Accessed 19 Sep 21)

[2] European Commission, ‘Joint Communication to the European Parliament and the Council: The EU Strategy for Cooperation in the Indo-Pacific’, (Brussels: High Representative of the Union for Foreign Affairs and Security Policy, 16 September 2021). Available at https://eeas.europa.eu/sites/default/files/jointcommunication_2021_24_1_en.pdf (Accessed 20 Sep 21)

[3] European Commission, ‘Outcome of Proceedings: EU Strategy for Cooperation in the Indo-Pacific’, (Brussels: General Secretariat of the Council, 16 April 2021).  Available at https://data.consilium.europa.eu/doc/document/ST-7914-2021-INIT/en/pdf  (Accessed 20 Sep 21)

[4] Andrew Small, ‘The Meaning of Systemic Rivalry: Europe and China Beyond the Pandemic’, European Council on Foreign Relations, Policy Brief, (13 May 2020)

[5]  European Commission, ‘Joint Communication to the European Parliament, The European Council and the Council: EU-China: A Strategic Outlook’, (Brussels: High Representative of the Union for Foreign Affairs and Security Policy, 12 March 2019), p 5

[6] European Commission, ‘EU-China: A Strategic Outlook’, (2019) p 1

[7] European Commission, “EU-China Comprehensive Agreement on Investment”, Version 22 Jan 2021, available at https://trade.ec.europa.eu/doclib/press/index.cfm?id=2237 (Accessed 23 Sep 21)

[8] European Commission, EU-China Comprehensive Agreement, Section IV,  Article 4, Sub-Section 3 (Investment and Labour) available at https://trade.ec.europa.eu/doclib/docs/2021/january/tradoc_159346.pdf  (Accessed 21 Sep 21)

[9] Axel Berkofsky, ‘Europe’s Involvement in the Indo-Pacific Region: Determined on Paper, Timid in Reality’, Asia Paper, (Stockholm: Institute for Security and Development Policy, August 2021)  pp 14-16

[10] Berkofsky, Europe’s Involvement in the Indo-Pacific, p 16

[11] Frederic Grare, ‘France, the Other Indo-Pacific Power’, Carnegie Endowment for International Peace, 21 October 2020, available at https://carnegieendowment.org/2020/10/21/france-other-indo-pacific-power-pub-83000 (Accessed 24 September 2021)

[12] French Ministry for Europe and Foreign Affairs, France’s Indo-Pacific Strategy, June 2021

[13]German Federal Government, ‘Policy Guidelines for the Indo-Pacific. Germany, Europe, Asia: Shaping the 21st CenturyTogether’, (German) Federal Foreign Office, August 2020

[14] German Federal Government, Policy Guidelines, Federal Foreign Minister’s Foreword, p 3

[15] Zhen, L, 2021, ‘China Denies Request for German Frigate to make Port Call in Shanghai’, South China Morning Post, 15 September 2021

[16] Hans Kundnani, and Michito Tsuruoka, ‘Germany’s Indo-Pacific Frigate May Send Unclear Message’, Chatham House Expert Comment, (4 May 2021), available at https://wwwi.chathamhouse.org/2021/05/germanys-indo-pacific-frigate-may-send-unclear-message
(accessed 17 September 2021)

[17] Arnaud Boehmann, ‘Why is Germany Sending a Frigate Through the South China Sea?’ South China Morning Post, (25 April 2021), available at https://www.scmp.com/week-asia/opinion/article/3130854/why-germany-send…, (Accessed 17 September 2021)

[18] HM Government, Global Britain in a Competitive Age: The Integrated Review of Security, Defence, Development and Foreign Policy, (London: HM Stationery Office, March 2021)

[19] HM Government, Global Britain, p 6

[20] HM Government, Global Britain, p 17

[21] ABC News Online, ‘China says it has warned a British warship as it sailed through the Taiwan Strait’, ABC News, 28 September 2021, available at https://www.abc.net.au/news/2021-09-28/china-warships-warn-british-ship/100495994?utm_campaign=abc_news_web&utm_content=link&utm_medium=content_shared&utm_source=abc_news_web (Accessed 28 Sep 21)