China’s economic planner woos European giants Airbus, BMW despite unresolved tensions over Ukraine

By Laura He, CNN

Hong Kong (CNN) — China has signed letters of intent to cooperate with many European corporate giants, as it attempts to mend relations damaged by Beijing’s perceived support for Moscow throughout the war in Ukraine.

The agreements were signed this week between China’s top economic planner and European manufacturing conglomerates, including Airbus (EADSF), BMW, Mercedes-Benz, Volkswagen (VLKAF), Siemens (SIEGY), and BASF, according to statements from the National Development and Reform Commission (NDRC).

During a signing ceremony in Paris on Thursday, Airbus CEO Guillaume Faury and the NDRC’s head Zheng Shanjie pledged to accelerate the construction of Airbus’ new assembly line in the Chinese coastal city of Tianjin, the NDRC said. The Chinese planner said it supports domestic airlines cooperating with Airbus according to their needs.

The NDRC will also work with other relevant European companies to deepen cooperation in areas including electric vehicles, energy saving and emission reduction, low-carbon product production, and new chemical materials, it said.

The agreements are part of Beijing’s charm offensive as the country’s Premier Li Qiang visited Europe this week for the first time since he took office earlier this year.

During his visit, Li lobbied European business and government leaders on the importance of economic cooperation. He also witnessed the signing of agreements between the NDRC and European companies separately in Berlin and Paris, according to the Chinese planner.

Beijing is seeking to repair its ties with Europe, which have been damaged by China’s aggressive “wolf warrior” diplomacy in recent years and its continued close partnership with Russia despite the invasion of Ukraine. Relations are also strained from recent moves by European Union regulators and governments to limit China’s access to sensitive technology.

Earlier this year, Europe joined the United States in its chip war with China, as the Netherlands announced new restrictions on overseas sales of semiconductor technology. The Netherlands is home to ASML Holding, a key supplier to the global semiconductor industry.

In March, European Commission President Ursula von der Leyen called on Europe to reassess its diplomatic and economic relations with China. She said the relations had become “more distant and more difficult” in the last few years as China ramped up its policies of “disinformation and economic and trade coercion.”

Some European countries have been walking a tightrope on managing their economic dependence on China.

On Tuesday, German Chancellor Olaf Scholz reiterated during Li’s visit that Germany needs to reduce risks in dealing with China, but not decouple with the country.

“Germany is committed to actively broadening our economic relations with Asia and beyond,” Scholz said at a joint press conference with Li, according to French news agency AFP. “We do not want to close ourselves off to any one partner, but to establish and expand balanced partnerships throughout Asia and beyond.”

Earlier this week, Italy imposed several curbs on tyre-making giant Pirelli’s biggest shareholder, China’s Sinochem, in a move aimed at blocking the Chinese government’s access to sensitive chip technology.

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CNN’s Hanna Ziady contributed to reporting.