In a belated, correct recognition, the European Commission in March called China an economic competitor and "a systemic rival promoting alternative models of governance".
One of the most vivid illustrations of this phenomenon is the interest that a string of countries along Europe's eastern and south-eastern flank, both EU members and not, have shown in Beijing's invitation to join its Belt and Road Initiative.
The "17+1" is the informal name for China's platform to discuss the BRI with the European end of its vast project to tie the Eurasian continent closer together. It captures the balance of influence well: 17 small European countries gathered around one giant. Brussels is right to worry that China is seeking to divide and rule, undermining a collective European policy.
Surprisingly, perhaps, China is not paying heavily for such influence by sending a lot of foreign direct investment to Europe. In fact European FDI in China is much bigger than the other way round, at least when it comes to greenfield investment rather than mere acquisitions of existing assets. Financially, China should be no match for the EU in its own backyard.
If Beijing can secure such interest for modest amounts of cash, it is because the EU's own offer is so meagre that it makes China's look attractive. Nor have European leaders presented anything like a political vision to rival Belt and Road's promise of more connected markets. If Europe is serious about its desire for strategic autonomy, this must change.
A report launched last week by the Vienna Institute for International Economic Studies usefully illustrates the scale of ambition that is needed. It proposes a "European Silk Road" along two routes connecting Lisbon to Uralsk and Milan to Volgograd and Baku. It envisages €1 trillion ($1.7t) of investment in state of the art climate-friendly transport infrastructure such as high-speed rail and roads fit for electric vehicles.
There are, of course, many things to question in a proposal of this magnitude. It neglects the need for north-south as well as east-west links, and the budgeting is rough. Some of the funding methods it suggests are highly speculative, such as a sovereign wealth fund capitalised with the European Central Bank's securities holdings.
It also gets some important things right. It acknowledges that transport infrastructure, measured for example in motorway kilometres per population, is a lot patchier in east/south-east Europe than in the richer EU states. It sees the high returns such infrastructure could generate by boosting the region's economic productivity. And it notes the gains from physically integrating not just the EU's own members but the wider neighbourhood.
The specifics of the report are less important than the bigger case it makes for an ambitious connectivity project. It is realistic about the scale of financing that needs to be mobilised — in the range of a trillion euros, or 7 per cent of the EU's gross domestic product for one year.
A mix of first-tranche public financing, guarantees, and plans for monetising some of the benefits through user fees should help attract ample private funding. With pension funds and other investors asking for long-term investments, infrastructure commitments at this scale could remedy some of the side-effects of prevailing ultra-low interest rates.
A big push for physical connectivity has a political function too: it offers a narrative to give the European project a more concrete meaning to its citizens and neighbours. If such a story proved more attractive than the China-centric model, the EU would have clinched a true geostrategic prize.
Written by: The editorial board
© Financial Times