EU and US should hold back China, Trump envoy says

"The jackpot ... is to have what is about a $40 trillion combined GDP working as a bloc in terms of dealing with Chinese growth, Chinese theft of intellectual property, [and] Chinese militarisation of the South China Sea," Gordon D. Sondland, the US envoy to the EU, told press in Brussels on Wednesday (3 October).

"The sooner we conclude our business [EU-US trade talks] ... the sooner we can seize the opportunity to make China act like a good global citizen," he said.

US president Donald Trump tore up a previous US-EU trade treaty, the Transatlantic Trade and Investment Partnership (TTIP), and slammed tariffs on EU steel and aluminium exports.

But the US envoy said talks on a new trade deal - that would see both sides open up their agricultural, automotive, defence, and other markets - ought to be concluded by the end of 2019.

The US is keen to help the EU stop China from buying up strategic industries, he added.

"We would not want to see [Europe's] critical assets and critical infrastructure, given their [China's] expansionist intentions, in the hands of the Chinese," he said.

The US has created an investor-screening mechanism, the Committee on Foreign Investment in the United States (Cifus), to prevent clandestine acquisitions, in a tool that Washington wanted to share with the EU, he noted.

"You don't want to sell a business to someone that you think is a Dane, or an American, or a Greek, then find out it's Chinese money or control behind it," he said.

Iran and Russia

Iran and Russia were two other "malign" actors that the Western alliance must keep in check, Sondland said.

Trump also tore up an Iran nuclear arms control accord, known as the Joint Comprehensive Plan of Action (JCPOA).

The EU has tried to keep the deal going by designing a new payment system to stop the US from imposing sanctions on European firms that did business with Iran.

But none of that would stop Trump from strangling Iran's economy if it did not negotiate a new accord, Sondland said.

"We believe those [US] sanctions will take a significant toll, notwithstanding all the actions being taken by the EU," he said.

"It's our belief, based on discussions with many, many companies that do business with Iran and the US, that those companies, no matter what's available to them [in terms of EU protection], will not continue to do business with Iran," he warned.

French and Danish authorities recently foiled plots by Iranian intelligence to harm anti-Iranian groups in Paris and Copenhagen, showing that Trump was right, he added.

"Those types of activity would not occur if we entered into an agreement [with Iran] that had real depth," he said.

Sanctions on Russia also "need to be turned up a notch," the ambassador added.

He singled out Russia's plan to build a gas pipeline, called Nord Stream 2, with Germany as a target for US action amid threats of US fines on EU firms that financed the project.

"The administration adamantly opposes Nord Stream 2 for one clear reason - Nord Stream 2 doesn't provide the energy independence that the EU could and should have," he said.

NS2 "makes it hard to turn up the pressure [on Moscow]" because it "enriches" Russia, he noted.

It also makes the EU vulnerable to energy blackmail, he said.

"What this is about is not putting Europe's energy in the hands of those who might turn against Europe one day and curtail supplies at the worst moment," he added.

US marriage

The multiplying list of EU clashes with the US - on trade, Iran, and NS2, as well as Nato spending and climate change - has prompted European leaders to explore closer relations with China, Iran, and Russia.

But Sondland, a hotel magnate from America's Pacific Ocean coast, who took up his post in July, said he did not see any shifting of allegiance on the geopolitical stage.

"Not at all. I couldn't see anything further from that," he said.

He described the transatlantic relationship as a "long-term faithful marriage that has its ups and downs" and that was currently in a "complicated phase".

Europe was a "continent far away with which we have a long treasured relationship, which we would never leave behind," he said.

"Whether it's hybrid attacks, or cyber attacks, or a full-on Nato-style Article Five attack, I don't have any qualms that the EU would be on our side, just as we would be on theirs," he said, referring to the Nato treaty article on mutual defence.

The ambassador, whose parents fled Nazi Germany and who is a philanthropist and an arts patron, has criticised Trump in the past - for instance over Trump's verbal attacks on the parents of an Iraq war casualty.

But he said the US leader had proved effective in office and won respect in the EU capital.

'Not comical'

"I don't consider president Trump a comical figure. I consider him a highly effective chief executive because when you look at the substance of what's being delivered, as opposed to the style of the messages, you will see ... lots of movement in our direction around the globe," he said.

"There has not been even a scintilla of: 'How can you be working for such a person?'," in his contacts with EU officials, he said.

Trump had to "put his foot down" by imposing tariffs on Canada and Mexico in order to get a new trade deal, he said.

Nato also needed "shaking up" to get European allies to spend more on defence, Sondland said.

The US might return to talks on climate change if other countries did not try to give their industries a free pass to pollute, he added.

"President Trump views climate change through more of an economic lens," he said. "If there was more parity, I think he would be more interested in participating," the US envoy said.