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«Soo Yeon Kim Sophie Meunier Zsolt Nyiri National University of Princeton University Montclair State University Singapore Prepared for the 23rd World ...»

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YIN AND YANK:

RELATIONS BETWEEN PUBLIC OPINION TOWARDS CHINA AND THE U.S. IN EUROPE

Soo Yeon Kim Sophie Meunier Zsolt Nyiri

National University of Princeton University Montclair State University

Singapore

Prepared for the 23rd World Congress of the International Political Science Association, Montreal,

Quebec, Canada, July 20-24, 2014.

Abstract

Perceptions of the United States in European public opinion have greatly improved since 2008, while simultaneously perceptions of China have deteriorated and, in some cases, turned decidedly negative. Are the image of China and the image of the US related in the eyes of Europeans? This paper explores whether anti-Chinese sentiment has the potential for replacing anti-Americanism in Europe. Using data from the 2010 Transatlantic Trends survey, we examine whether attitudes towards China determine attitudes towards the US in Europe. We investigate three hypotheses about this relation: the “zero-sum” or negative correlation (the more Europeans fear China, the more positive they become about the US; the more favorably Europeans view China, the more negatively they see the US); the “open vs. closed” or positive correlation (the more favorably Europeans see China, the more favorably they see the US; the more negatively they see China, the more negatively they see the US); and no relation (European attitudes towards China and the US are independent).

2 The image of the United States in Europe reached a low point during the George W. Bush administration. Anti-Americanism was rampant, especially in Western Europe, where the biases were mostly based on a contemptuous critique of American hypocrisies and an existential fear of American hegemony and ubiquitous power. The election of Barack Obama transformed this anti- American vision almost overnight, and three years later the favorability ratings of the US are still very high in Europe, whereas they did return to pre-“Obamania” levels in other regions of the world. By all accounts, Europe is now the most “pro-American” continent. What a difference a few years make.

This apparent conversion of Europe to a more positive disposition towards the US coincided with the “rise of the rest” (Zakaria, 2008), and notably the relative decline of the US and the dramatic economic ascent of China. The 2008 financial crisis in the US and the sovereign debt crisis that hit Europe in early 2010 consecrated the arrival of China as a major actor on the European scene. China invested massively in the troubled economies of Greece, Ireland, Spain and Portugal, and provided a welcome bailout for these countries. Interestingly, while Europeans warmed up to the US in these last years of the decade, they also simultaneously cooled down towards China.

Indeed, the top four countries in the world with the most negative image of China are all in Western Europe (BBC World Service Poll, 2011). Are the image of China and the image of the US related in the eyes of Europeans?

This paper explores whether anti-Chinese sentiment has the potential for replacing antiAmericanism in Europe. Using data from the 2010 Transatlantic Trends survey1, we examine how Transatlantic Trends is a comprehensive annual survey of American and European public opinion 1 and is a project of the German Marshall Fund of the United States and the Compagnia di San Paolo, with additional support from the Fundação Luso-Americana, the Fundación BBVA, and the Tipping Point

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hypotheses about this relation: the “zero-sum” or negative correlation (the more Europeans fear China, the more positive they become about the US; the more favorably Europeans view China, the more negatively they see the US); the “open vs. closed” or positive correlation (the more favorably Europeans see China, the more favorably they see the US; the more negatively they see China, the more negatively they see the US); and no relation (European attitudes towards China and the US are independent).

The main findings generally support the positive correlation hypothesis. Positive attitudes towards China are accompanied by similar attitudes towards the US. However, this is most pronounced in the case of negative sentiments. Where European publics find U.S. leadership on the global scene undesirable, they also dislike China and see its rise as an economic threat more than an opportunity. The results of the analysis suggest that rather than replacing the United States, China may be joining it as yet another major global actor subject to hostile public opinion from the “antihegemony” and “anti-globalization” camp in European countries. The findings also point to a real line of cleavage in European public opinion between those who fear economic and cultural openness and those who feel curious and optimistic about globalization.

Few, if any, studies have looked at this question of whether anti-Americanism in the 21st century is now influenced by attitudes towards China. Zixiao Yang and David Zweig asked whether pro-American sentiments increased the likelihood of being anti-Chinese, but we are not aware of Foundation. Polling was conducted by TNS Opinion between June 1-2917, 2010, in the United States, Turkey, and 11 European Union member countries: Bulgaria, France, Germany, Italy, the Netherlands, Poland, Portugal, Romania, Slovakia, Spain, and the United Kingdom. More detailed Methodology in Appendix A.





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China has been studied in more detail than how Europeans do the same (Page and Xie, 2010).

As Jeffrey Legro and Peter Katzenstein remarked in their task force on US standing in the world, American foreign policy seriously needs more gathering of information and collection of data on how the US is viewed abroad (American Political Science Association, 2009). With this paper, we hope to fill this gap by providing the first systematic study of the impact of attitudes towards China on attitudes towards the US among the publics of its most important security allies.

After presenting how China has become an actor in Europe and comparing the reality of American and Chinese power today, the paper introduces three hypotheses about the potential role of European attitudes towards China as a determinant of their attitudes towards the US. We then explore this relation by analyzing data from the 2010 Transatlantic Trends survey. We conclude by asking how transitory or permanent these changes are and by exploring some of the policy implications of these results.

1. CHINA AS AN ACTOR OF GLOBALIZATION IN EUROPE

Until recently Europeans were either indifferent towards China or looked at its rise with curiosity and even excitement. And yet in 2010 Europeans, especially in the West, had among the most unfavorable attitudes towards China in the entire world. What has changed is that China, though not a major global military actor and certainly not one on the European continent, has become a visible economic actor in Europe.

The role of China on the European continent has been transformed in recent years. In the mid-2000s, China was regarded with curiosity as one of the BRICS and with surprise as an example

–  –  –

boom was a source of enormous opportunity for European companies, whether because of the potential size of the Chinese market or because of the savings provided by cheap labor. European workers, especially those in low-skilled jobs and the manufacturing sector, saw China with fear as a source of unfair competition. European consumers saw China as a source of cheap stuff, a central factor in driving down the price of consumer goods. But if China was already a major economic power, it was not yet a major actor on the European scene.

By 2010 the picture was markedly different. China has become an economic actor on the European continent. This rise to actorness was precipitated by the strategic push by the Chinese government to prompt its firms to “go out” and invest abroad, by the 2008 financial crisis in the US, and by the 2010 sovereign debt crisis in the Eurozone. As a result, European fears about the growing power of China have increased dramatically.

With its “Go Out” policy edicted in 1999, the Chinese government encouraged Chinese firms to develop operations overseas with the help of preferential long-term loans. The push for Chinese outward Foreign Direct Investment (FDI) started initially in countries that could provide China with needed raw materials and natural resources, mostly in developing countries in Africa and Latin America. By the end of the 2010 decade, however, Chinese firms were actively investing through a multitude of greenfield projects and mergers and acquisitions in Europe and the United States, where they could obtain technology and know-how while diversifying their reserves, building brands, and maximizing their profits. While China has still a very modest presence in Europe, accounting for only 0.2% of all FDI stock in 2010, it is growing very rapidly and visibly, and Chinese investments are increasing at a faster pace in Europe than they are in the US (Hanemann, It's Official: Chinese FDI in the US is Soaring, 2011; Rosen & Hanemann, 2011; Hanemann & Kirkegaard,

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a blow to the status of the United States. First, because it did originate in the US and the main source of culpability lay mainly with American actors, be they big banks or regulators. Second, by revealing and accelerating the extent of American debt, the crisis weakened the ability of the US to project its power. Finally, the coup de grace was given by China stepping in to purchase American debt, reinforcing the impression that the center of gravity of international power had shifted towards the orient.

This paper focuses on 2010, a watershed year for Chinese-European relations. In 2010, China overtook Japan to become the world’s second largest economy (Barboza, 2010). China also passed Germany as the world’s top exporter (Bradsher & Dempsey, 2010). The Copenhagen conference on climate change in December 2009 revealed to Europeans that it was now China, no longer the US, who was now the main obstacle to an agreement and consecrated China as a major actor in international negotiations. 2010 also saw several important state visits by Chinese officials in Europe, including Hu Jintao’s pompous visit to France in November 2010.

More important than anything else, however, was the European sovereign debt crisis in Europe which exploded in Greece in the spring of 2010 and then spread to other European countries. The US could be of no help since its own economy was mired in debt (much of it owned by the Chinese). China used the opportunity provided by the Greek turmoil to invest massively in the country, leasing for instance the port of the Piraeus for 35 years, as well as acquiring major stakes in distribution, telecommunications and real estate, providing welcome relief to Greece in the process (Faiola, 2010). Ireland, next in line of the euro countries in crisis, attracted massive investment from China to create a manufacturing hub in Athlone (Inman, Macalister, & Wachman, 2010). When it was Spain’s turn to face its own debt crisis, China provided a lifeline by investing in

–  –  –

really catapulted China as an essential actor in Europe.

The power of China has now become an obsession in the European media. European magazines increasingly use menacing images of China on their covers, such as The Economist’s “Facing Up to China” (The Economist, 2010), “Buying Up the World” (The Economist, 2010), and “The Dangers of a Rising China” (The Economist, 2010), all cover stories in 2010. The “yellow peril” of the 21st century has become one where greedy Chinese capitalists take over prominent and sensitive European companies, steal and copy European technology, and destroy European manufacturing jobs while inundating the continent with potentially defective goods, all produced while ignoring human rights.

As a result, Europeans overestimate Chinese economic power and underestimate European power. The reality is the following: the EU is the world’s largest economic actor, whether measured in GDP, percentage of world trade, or percentage of inward and outward foreign direct investment (both flows and stocks). By contrast, Chinese investment in Europe is still very modest and incommensurate with European investment in China: European companies invested €5.3 billion in China in 2009, while China invested €0.3 billion in 2009. This is respectively less than 3% and 1% of both sides' total investment outflow (European Commission, 2010).

But it is true that China’s role in Europe is changing and European attitudes towards China seem to be determined more by perceptions of the tangent and the trajectory than by a snapshot of contemporary reality. Indeed, when asked who is the leading economic power in the world today, Europeans in their majority started to answer China over the US in 2010 for the first time: 51% in Germany (vs. 18% for the US), 47% in France (vs. 41% for the US), 44% in Britain (vs. 38% for the

–  –  –

determined that China has become the main driver and the main beneficiary of globalization.

2. THE POTENTIAL IMPACT OF ATTITUDES TOWARDS CHINA ON ATTITUDES

TOWARDS THE US

This paper explores whether the actual and perceived rise of China is affecting attitudes towards the United States in Europe. After all, anti-Americanism in Europe was attributed in large part to American hegemony, including economic hegemony (Chiozza, 2009; Holsti, 2008;

Katzenstein & Keohane, 2007). If the US has been dethroned from its economic pedestal by China, what will happen to attitudes towards the US? We posit three hypotheses about the impact of attitudes towards China on attitudes towards the US.



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