This article is part of the US-China Dynamics series, edited by Muqtedar Khan, Jiwon Nam and Amara Galileo.

For decades, scholars have written on the decline of the United States (US), the rise of China, and the seemingly inevitable hegemonic competition between the powers as the international system morphs from a period of post-Cold War American unipolarity to something new (Mearsheimer 2001; Ikenberry 2008; Blackwill and Tellis 2015). Debate swirls as to China’s intentions as it rises, how the US should respond to its reduction in relative power capabilities, and whether or not a Chinese-dominated international system would differ in significant ways from the current world order. Tensions between the US and China have already begun to rise as evidenced by the Trump administration’s public ‘trade war’, the Biden administration’s diplomatic boycott of the 2022 Winter Olympics in Beijing, and the ramping up of military capabilities on both sides in the South China Sea. 

As these two poles on opposite ends of the globe battle for supremacy, another power is likely to have significant influence over the functioning of international politics: Europe. The continent of Europe is home to a number of developed and industrialized, populous and prosperous states that, combined under the European Union (EU) and North Atlantic Treaty Organization (NATO), hold significant military, economic, and cultural power. The combined economies of the EU and United Kingdom (UK) have the second-highest gross domestic product (GDP) in the world, trailing only the US (World Bank 2021). The militaries of Europe are among some of the most advanced in the world, with nuclear capabilities independent of the American arsenal. If China wants to de-throne the US as the leader of the international system, or achieve a system of shared hegemony, it will likely need to at least weaken the trans-Atlantic alliance that has bolstered American predominance since the end of World War II. At the same time, if the US hopes to stave off China’s growth in power, it will likely need its European allies to help curb the economic giant’s continued ascendence.

This chapter seeks to analyze how the US and China are courting and/or losing influence (or leverage) over Europe as a way of maintaining/growing their international positions. Recognizing the power and agency of Europe, the chapter also analyzes the ways in which Europe may be able to push back and influence the relationships it has with the superpowers to its east and west. The paper begins with a justification for a regionalization of Europe and the study of it as a singular unit of analysis vis-à-vis the US and China. The next three sections examine the ways that the US and China are gaining and/or losing leverage over Europe in three key areas: (i) militarily; (ii) economically/technologically; (iii) governmental structure. This chapter also reviews the  European counterinfluence on the relationships with these two superpowers. Finally, the chapter concludes by exploring the possibility of Europe standing as an example of a shared Sino-American influence on the international stage. If the US and China can peacefully coexist in European affairs, is it possible for the two powers to share hegemonic power over the international system in the mid-21st century? 

Europe as a Regional Bloc

An important aspect of this analysis is the view that Europe is a singular, regional unit of analysis. In a similar vein to John Mearsheimer’s (2001) seminal study of great powers, if the US and China hope to be considered leaders on the international stage, they need to be able to exert some sort of leverage in other regions of the world to produce outcomes favorable to them. Europe is a significant player on the international stage, and the ability to hold some sway over the powerful bloc will be key for the US and China. However, questions arise about the viability of viewing Europe as a singular unit to be influenced given the diversity of sizes, economies, cultures, and militaries of states on the continent. The presence of two supranational institutions – the EU and NATO – binds the economic and military interests of the continent together, allowing for the region to be studied as a whole. 

Most of the states of Europe are members of either the EU or NATO if not both. Stretching from Portugal to Turkey and from Iceland to Greece, these two institutions attach their members to one another. Save for some exceptions, the countries of Europe are in some way reliant on one another for economic and military stability. Though some may consider NATO to mostly be a US-led institution (Richey 2019), for the purposes of this study NATO is still a useful unit of analysis to explore the ways in which the European nations of the treaty organization are bound together in military defense through clauses such as Article 5 (North Atlantic Treaty Organization 2023). There is undeniably a vast diversity of domestic political priorities and economic development amongst EU and NATO member states. However, the collective defense and negotiating power of these institutions creates a common interest among these states, as well as a united front toward other international actors. 

While there are some states on the continent that are not party to either organization, EU and NATO member states still have an incentive to maintain stability with these states on their collective borders. And these non-affiliated states have reason to maintain working relations with the rest of the continent. This is exemplified no better than with the escalation of hostilities within Ukraine. The Russian invasion in 2022 has only increased calls for EU membership in Ukraine, as well as calls for NATO membership in Finland and Sweden (Morcos 2022; Mitchell 2022). During this time of crisis, the continent appears to be strengthening its bonds in the face of an aggressive international actor. 

Questions over the strength of EU and NATO continuity also appear to be subsiding. Following the historic vote by the people of the UK to leave the EU in 2016, some feared that what came to be known as ‘Brexit,’ coupled with the rise of right-wing populism throughout Europe, would signal the beginning of significant struggles for the longevity of the continental institution (Malik 2018). Concerns over a cascading line of state exits from the EU appear to have died down. The UK and EU are still significant trade partners (the EU accounts for 42% of British exports and 50% of its imports) and thus are inclined towards amicable cooperation, while no other major attempts have been made by any other member to leave the EU (UK House of Commons Library 2021). 

Following public complaints about NATO by then-US President Donald Trump, questions arose about the future of NATO as well (Reuters 2017). The US is unlikely to leave NATO, and in the improbable event it does, the remaining military powers of Europe have a national interest in maintaining the security of the entire continent. Because of the economic and military convergence of interests in Europe, thanks in large part to the EU and NATO, the continent can be analyzed as a single unit in relation to how the US and China may attempt to gain influence over the bloc of nations. The following three sections explore the ways in which the US and China may be able to exert some leverage over Europe in terms of military, economic/technological matters, and governmental structure, as the two countries wrestle for control of the international system, while also highlighting how Europe may be able to exert its own influence in response. 

Competing Military Influence

The first of three realms of influence in this analysis centers on military capabilities. The US, China, and many states within Europe maintain large and technologically advanced armies. The following paragraphs analyze the ways in which the US and China may use their militaries and treaties to leverage Europe. The presence of NATO gives the US a significant advantage in this realm. 

A major source of American influence over Europe comes from its continued membership in NATO. The military alliance between the US, Canada, and 28 European nations keeps these states unified in their security interests, as well as reliant on American troops and aid. The US contributes far more to NATO (both in absolute terms as well as in percentage of national GDP) than any other nation in the organization. NATO allowed the US to house more than 64,000 troops in hundreds of military bases across Europe in 2020 (US Department of Defense 2021). While the US is incredibly unlikely to use these American troops on the European nations themselves, this troop presence keeps Europe dependent on American aid and support for military matters. This relationship is mutually beneficial for all members as the US enjoys the support of their European allies, while Europe is protected under the American security umbrella.

The US also accounts for the most arms imported into Europe. According to the Stockholm International Peace Research Institute (SIPRI), 47% of European arms imports from 2016–2020 came from the American government (Wezeman, Kuimova, and Wezeman 2021). Israel was the second largest non-European supplier of weapons to the continent, accounting for a significantly smaller 6.7% of arms imports to Europe in the same timeframe. Looking specifically at the typically larger and more diversified economies and militaries of Western and Central Europe, the US accounted for 56% of these specific countries’ arms imports from 2016 to 2020. Of the six European states who imported the most weapons from 2016–2020, the US was the largest supplier of weapons to each of these nations. More than one out of every 20 weapons (5.5%) sold between any pair of countries globally from 2016–2020 moved from the US to a European nation (Wezeman, Kuimova, and Wezeman 2021). As can be seen, the US is by far the largest exporter of weapons to Europe, built largely around relationships established through NATO, as well as the thriving American military-industrial complex. 

While the US enjoys a large amount of military influence over Europe through NATO, the superpower has lost some credibility with its allies. Tensions over the disastrous wars in Afghanistan and Iraq grew as European support for the long-lasting and costly conflicts dried up. Former President Trump’s criticisms of NATO have done little to mend military relations across the Atlantic. While wars in the Middle East and complaints about NATO funding have hurt American military standing in Europe, it is clear that the Europeans still rely heavily on America for support. NATO provides the US an excellent form of influence over Europe to garner support for military actions taken by the world superpower. 

China’s military influence over Europe is nowhere near that of the US. China does not hold any significant number of troops or weapons within Europe. China does not enjoy a military alliance with Europe, in contrast to the US and NATO. While China is growing as an international arms dealer, most of its exported weapons are going to Pakistan and Bangladesh. These South Asian states account for more than half of Chinese military exports from 2016–2020 (Wezeman, Kuimova, and Wezeman 2021). According to the Center for Strategic & International Studies (CSIS), Serbia was the only European nation to receive any arms imports from China in 2020 (CSIS 2021). Serbia, neither a of the EU nor NATO at the time of writing, made a weapons deal with China for radar-guided missiles and armed drones (Reuters 2020). According to Collin Koh, China struggles to export weapons for two reasons: (i) the political costs of dealing with China, and (ii) Chinese weapons have largely not been combat tested and therefore lack the recognition of American arms (Jennings 2021). China imports some weapons from a number of European nations including France, Germany, the UK, Ukraine, and Switzerland. However, Chinese purchases of weapons are only significant to Ukraine – China is the largest purchaser of Ukrainian weapons at 36% of 2021 Ukrainian arms exports (Wezeman, Kuimova, and Wezeman 2021). However, on the whole, China does not compare to the US as an importer or exporter of European arms. 

As China has continued to solidify its trading routes to Europe through its Belt and Road Initiative, the People’s Liberation Army Navy (PLAN) has become increasingly active around the waters of Europe. PLAN ships have been repeatedly spotted in the Strait of Hormuz, the Mediterranean, and the Arctic Ocean (Garamone 2020; Godement 2021). While China does not have the naval presence in Europe to pose a serious security threat, these actions do display a Chinese interest and capability in sending naval ships to protect shipping lanes to Europe. If the Chinese continue their rapid growth in naval power and maintain their status as the largest navy in the world with over 350 ships, they may increase their presence in European waters in the name of protecting trade (US Department of Defense 2020). Even with this occasional naval presence near Europe, China’s military influence over the continent is dwarfed by that of the US. 

Competing Economic/Technological Influence

The next realm of influence in this study centers around the economic and technological sectors of influence. The US, Europe, and China represent the three largest economies in the world; trillions of dollars’ worth of goods and services are produced and traded amongst them. The following paragraphs analyze the ways in which the US and China may use their massive economies and tech industries to influence Europe. The US is currently Europe’s largest trading partner, once again giving it an advantage over China, though the latter’s growing economy may become increasingly attractive to Europe.

The US alone produces more goods and services than any other country in the world. According to the World Bank, its GDP in 2020 was over $20.9 trillion. This gives the country tremendous power in negotiating trade deals with other states and foreign entities. The US dollar is also the currency of global economic order, again benefiting the US as its currency is valued across the world. 

The US is currently running a trade deficit with the EU, meaning America is importing more than it is exporting from EU member states. According to the European Commission, in 2019 (the last fiscal year the UK was a part of the EU and the most recent year with full data available), the US exported $513.1 billion worth of goods and services to the EU, while importing over $676.1 billion (European Commission 2021). The US imports more from the EU than any other country in the world. The US also sends more foreign direct investment (FDI) – $2.26 trillion in 2019 – to the EU than any other country in the world (European Commission 2021). These trade and FDI numbers alone give the US a tremendous amount of leverage over the EU because if it were to threaten to suspend economic relations with the EU, the European economy would struggle to find any nation (or even grouping of nations) that would be able to match the number of imports the US currently takes from the EU. Now, the US is again unlikely to threaten to cancel trade relations with the EU because it also benefits the US to have a strong trading partner in Europe. However, European reliance on American trade and investment is likely to keep the nations of the EU tightly bound to the US and its vision for the world economic order. 

An apt example of the economic influence the US holds over Europe is the current trade negotiations ongoing between the US and UK. When the UK left the EU in January 2020, it also backed out of the collectively agreed upon US-EU trade deal. Trade between the US and UK alone accounted for over $273 billion in 2019. Negotiations regarding a new trade deal between the US and UK have stalled as the Biden administration continues to pressure the British government to come to a resolution with the EU regarding the Northern Irish border (BBC 2021). The US is utilizing its economic muscle to influence the UK into taking an action the American government finds preferable to its interests. 

China has the second largest economy of any single state in the world. According to the World Bank, its GDP in 2020 was over $14.7 trillion. The Asian power’s steady GDP growth over the past few decades has driven the debate over China’s rise as a superpower on the world stage. Similar to the US, China’s massive economy gives it significant power in trade negotiations with other states and international entities. China has made some progress in economic relations with the EU, specifically with the EU-China 2020 Strategic Agenda for Cooperation, which created a shared understanding of relations between the two entities. Nonetheless, Chinese trade with Europe still pales in comparison to the US (European External Action Service 2020). 

In economic relations with the EU, China exported over $447.2 billion worth of goods and services to the EU, while importing over $283.3 billion in 2019 (European Commission 2021). China’s trade surplus with the EU leaves it with significantly less power to influence European actions in a manner similar to the US. If China were to cut off trade with Europe, the $283.3 billion worth of lost exports for the EU would still pale in comparison to the $676.1 billion the EU would stand to lose if trade with the US ground to a halt. So, while the Chinese certainly play a large role in the European economy, the influence stemming from trade favors the US. China is also a major investor in Europe, sending over $78.3 billion worth of FDI to EU nations in 2019 (European Commission 2021). Fears of an influx of Chinese investment in Europe have simmered as FDI from China to Europe has steadily decreased since its peak in 2016 (Kratz, Zenglein, and Sebastian 2021). Chinese FDI in Europe is significantly less than that coming from the US, and Europe invests more heavily in China than vice versa. A significant portion of Chinese FDI comes in the form of purchasing control over infrastructure in European countries as part of the Belt and Road Initiative. Chinese companies with ties to the government have invested in infrastructure projects across Portugal, Italy, Greece, Serbia, Montenegro, North Macedonia, and Belarus as China continues its quest to link the entry points of Europe to the Chinese economy (BBC 2019). If completed, the Belt and Road Initiative will link China with a number of established and growing economies throughout Asia, Africa, and Europe. 

China may also hold some advantages in the production of key technology for the future. China already has an advantage over the rest of the world in the production of smartphones, 5G telecom network equipment, lithium-ion batteries, and solar panels (Whalen and Alcantara 2021). Some experts report that China accounts for over 90% of the rare Earth elements used in the production of batteries used in smartphones, computers, and cars (Dreyer 2020). Chinese 5G technology company Huawei appealed to some European companies for its ability to cheaply create 5G infrastructure in major cities, although pressure from the US cooled development between the continent and the company (Fuchs 2019). This American pressure on Europe over Chinese technology suggests that a shared coexistence of strong influence in the region may be unlikely. Perhaps a soft diplomatic competition for influence is more likely than a shared hegemony or outright military competition. In sum, Chinese economic and technological influence over Europe is still not as great as that of the US – though the rising power is beginning to make some inroads in the region. 

Competing Governmental Structure Influence

The third and final aspect of influence in this analysis has to do with governmental structure. The presence of similar governmental structures can help facilitate relations between states in the international system. Standing in solidarity on shared structural values provides states with a sense of legitimacy towards one another. The shared history and political structures of the US and Europe give the Americans a leg up in currying favor with the continent compared to the Chinese. 

American dominance of the international system after the end of World War II was built in part by its relationship with Europe. The nearly century-long alliance between the US and most of the countries of Europe has fostered an elevated level of trust and understanding among the trans-Atlantic partners. In the post-World War II era, the US played a large part in encouraging the spread of liberal democratic values and governmental structures throughout much of Europe. While there are some European nations with some autocratic tendencies (e.g., Viktor Orbán in Hungary), the continent on the whole is much closer to an American style of governance compared to the Chinese example. Though states with different government and election structures are able to form working relationships (such as the US-Saudi alliance), the presence of similar government structures allows for an increased level of understanding and respect among the leaders of these states. Competitive elections for political office at the local, national, and supranational level in European nations help to form a shared sense of identity, values, and accountability with American political leaders. 

Recent US-EU summits in 2021 and 2023 have reaffirmed the member states’ commitment to promoting and defending the nations’ shared democratic values (The White House 2023). The Biden administration made a priority of leaning on America’s democratic structure and values in forming its foreign policy, particularly in relation to Europe. The renewal of more positive trans-Atlantic relations under the Biden administration serves to further strengthen the bond between the US and Europe and maintain this form of influence on Europe. 

Unlike the US, China does not share a similar governmental structure with most of the EU. China has been branded as an authoritarian state by many governments and scholars due to the Chinese Communist Party’s (CCP) strong grip on power. China cannot appeal to a shared government structure with the democracies of Europe, nor to a shared history in the same way the US can. Many of the democratic values upheld by European countries are not present in the Chinese regime. Though there are some competitive elections in China, a majority of the positions of power are chosen through the CCP. China has also been internationally condemned for its track record on human rights. This authoritarian/democratic divide in governmental structure between China and Europe can create difficulties between the entities. China’s autocratic government place it in closer relations with Russia, an autocratic foe on the eastern front of Europe with renewed tensions following the invasion of Ukraine. 

While China’s authoritarian regime may not be attractive to most nations in Europe, it can and increasingly appears to be an example for some Eastern European states. As states such as Hungary, Poland, and Belarus continue to experience democratic backsliding, the authoritarian leaders of these nations are increasing their relations with China. These autocratic governments see China as an example of how to run an effective and powerful authoritarian state. These European economies also benefit tremendously from the Belt and Road Initiative and Chinese investment. As Jakub Jakobowski notes, one China expert described Belarus as ‘our Pakistan in Europe’ – referencing the increasingly friendly relations between China and Belarus (Jakobowski 2021). If China can continue to grow its relationship and influence over states like Poland and Hungary (members of both the EU and NATO), then the rising superpower could attempt to divide the European institutions. Some actions including common foreign and security policy in the EU and declarations by NATO require unanimous agreement. China’s ability to garner support from the more authoritarian states of Europe could dampen the cohesion of European decision-making. 

European Counterinfluence

Recognizing that the US and China do not influence Europe in a vacuum and that the continent has mechanisms of its own to influence the two superpowers, the following paragraphs explore the ways in which Europe can counterbalance against American and Chinese leverage. Disastrous wars in Iraq and Afghanistan and American criticisms of NATO have caused a slight rift between the trans-Atlantic partners on military matters. For as much as Europe may benefit from the US for its military support through NATO, the US also benefits from European support for their actions globally. According to John Ikenberry (2001), part of what has made American preponderance of power acceptable to other states in the international system is the fact that the US has rarely acted unilaterally. If Europe were to scale back its historic support for and involvement in America’s global use of its military (e.g., the 2003 invasion of Iraq), the US would lose a key multilateral ally, as well as the ability to show the world that its military might is used in conjunction with others. Whether or not any potential withdrawal of support for future military activities would alter American behavior is certainly up for debate, but the US clearly relies on European support to legitimize its military operations across the globe. While Europe may not have the ability to match American or Chinese forces, a number of European states maintain an advanced military and nuclear arsenal that would keep the continent a relevant power on the world stage.

Particularly in the sphere of economics, the combined might of Europe gives the bloc its own significant influence and power. As the second-largest GDP in the world, the European bloc has the potential to act as a counterbalance to American and Chinese economic influence. As discussed above, the EU is a major trading partner of the US and enjoys the influential benefits of a trade deficit with China. The EU also heavily invests in the two world powers, sending nearly $2.5 trillion worth of FDI to the US and roughly $225 billion to China in 2019 (European Commission 2021). European FDI outpaces both the American and Chinese investment in Europe meaning that the Europeans also play a significant role in world trade and have considerable influence over these nations as well. 

Europe is not without its own forms of non-economic soft power that it can wield in its relations with the US and China as well. Just as the US may utilize its shared history and governmental structure to curry favor with Europe, the reciprocal nature of this relationship means Europe can also sway the US. European metropolises are still among the most traveled to in the world (Elliot 2020). Europe is also home to a number of top institutions of higher education that attract thousands of international students. European history and culture also appeal to many around the world. Imitations of European landmarks and cities abound across China and the US (When on Earth 2021). While the US and China can certainly attempt to leverage Europe using non-economic soft power based on governmental structure and values, Europe also has a strong and influential culture and political system(s) that is appealing to many outside its own borders. 

Prospects for a Shared Influence of Europe

In sum, the US and China have a number of possible foreign policy options to gain European support, or at the very least deter European opposition to their competition over the international system – though it is clear that the US enjoys a better relationship with Europe than China and is unlikely to lose this supremacy any time soon. The US’s continued presence in NATO and arms exports to Europe gives it leverage in its relations with the continent. By importing more European goods than any other nation, the US also enjoys economic influence. Finally, a shared governmental structure further strengthens Europe’s bond to the US. China is not without its own foreign policy options to carve out space for its own influence over the Europeans in the future. Rapidly growing Chinese markets and dominance in the production of necessary technologies will become increasingly attractive to European nations. The CCP’s authoritarian hold on power in China also serves as a model for growing authoritarianism in some in European states (e.g., Poland and Hungary). This alternative to liberal democracy could threaten the stability of European institutions that are built largely around democratic ideals. Finally, China’s continued progress in its Belt and Road Initiative is certain to increase trade and relations with Europe, bringing the two entities closer together in time. 

The question remains as to whether or not the US and China can peacefully coexist as the dominant forces in international politics. Is it possible that shared Sino-American influence in Europe can stand as an example of what an international system dominated by the US and China could look like? The US holds an advantage over China in all three categories of influence in relation to Europe. War between the US and China over Europe seems unlikely (all three entities benefit far too greatly from stable relations). What is more reasonable to imagine is a diplomatic competition between the two poles, as exemplified by the American pressure against the use of Chinese 5G technology. Envisioning the future of Europe under a shared Sino-American hegemony seems some time away given the strong leverage the US has in the region. But China’s diplomatic and economic growth in Europe may stand as an example of how the power may exert influence in other regions not as historically and institutionally dominated by their American counterparts. 

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Further Reading on E-International Relations

• US-China Dynamics: Competition, Conflict or Cooperation?
• Russia’s Reaction to US-China Competition in Central Asia
• Opinion – A New Balance in Sino-US Relations?
• Opinion – China’s Saudi-Iran Deal and Omens for US Regional Influence
• US-China Rivalry and the Future of Africa
• The US-Iran-China Nexus: Towards a New Strategic Alignment