The European Think-tank Network on China (ETNC) has for many years now analyzed the variations among European countries’ relations with China on a range of issues, including economic interdependencies, soft power, the Covid-19 pandemic, political values or the impact of China’s growing rivalry with the United States (all publications available on the network’s website: https://etnc.info). In this report, ETNC takes stock of national approaches to China across EU members states and important countries such as the United Kingdom, Norway and Switzerland. Experts from 24 countries have contributed their analysis, and the MERICS office in Brussels provided a chapter outlining current EU policies vis-à-vis China.

The European Think-tank Network on China (ETNC) is a gathering of China experts from a selection of European research institutes. It is devoted to the policy-oriented study of Chinese foreign policy and relations between China and European countries as well as China and the EU. It facilitates regular exchanges among participating researchers. 

Frida Lindberg contributes with the chapter on Sweden (below). In the chapter, Lindberg describes the significant shift Sweden’s approach to China has undergone in the past five years, how Sweden deals with China-related issues and the next three big China-related challenges that Sweden is facing. 

Sweden’s approach to China: from optimistic opportunities to growing challenges 

Summary

Sweden’s approach to China has undergone a significant shift in the past five years. From being viewed as mostly providing opportunities, China is now seen as posing increasing challenges for Sweden. This more negative view of China is also reflected in perceptions among Swedes, who hold the second most negative view of China in the world. This chapter explains the reasons for these developments, describes how Sweden deals with China-related issues and identifies the next three big China-related challenges facing Sweden.

Sweden's China policy: gradually getting tougher?

After the end of the Cold War, a widespread perception prevailed in many Western countries, including in Sweden, that liberal democracy had defeated communism. Increased economic integration and international cooperation were believed capable of generating development of democracy in China. China was also seen as attractive for investments, exports and imports. Thus, throughout the 1990s and 2000s, engagement with China was in Sweden generally viewed as an opportunity that one could not afford to miss. In recent years, however, this positive attitude has changed. Dealing with China is no longer viewed as mostly presenting opportunities; it is also seen as involving growing challenges that are becoming more difficult to deal with.^[1] Sweden’s former, social democratic-led, government’s white paper on China, which is sometimes described as Sweden’s China strategy, was published in 2019 in the light of “China’s growing influence in the world and the new implications, opportunities and challenges this brings”.^[2] It describes Sweden’s relations with China, and sets out the former government’s views on and approach to matters relating to the country. The white paper, which is based in part on the European Union’s 2016 Strategy on China,^[3] also describes the EU as Sweden’s “most important foreign policy arena”,^[4] and emphasizes that the pursuit of a common EU policy on China is important for Sweden.^[5] Although this document was unanimously approved by the Riksdag (the Swedish parliament), the former opposition parties criticized it for not containing enough concrete measures.^[6]

A centre-right government was formed following the September 2022 general election, made up of the Moderate Party (M), the Liberal Party (L) and the Christian Democrats (KD). In the Riksdag, the new government cooperates with the Sweden Democrats (SD), a nationalist and right wing populist party. Although the new government, led by Prime Minister Ulf Kristersson (M), has not yet presented its own China policy, Sweden’s policy on China is likely to change due to the change of government.^[7] The current governing parties and the Sweden Democrats actively raised issues relating to China while in opposition, but this tougher stance has so far not translated into concrete policy measures.^[8] In line with the former government, however, the new government has emphasized the importance of the EU’s role in Sweden’s approach to China. For instance, in November 2022 Prime Minister Kristersson stated that:

• A single European voice is needed in relations with China. Each individual country’s voice is weak, but China listens when the EU speaks as one. This is why the EU-China strategy, tools to limit China’s influence on sensitive technology and joint action when China violates human rights are necessary.[9]

A deteriorated image of China in Sweden

Some of the current drivers shaping Sweden’s relationship with China are closely related to Sweden’s identity and values, such as its views on human rights, which have contributed to a more negative view of China. Sweden's traditional free trade-friendly policy is also deeply rooted in both the business world and the government sector. Generally, business actors in Sweden participate only to a limited extent in the debate on China-related issues. One reason for this is probably that Swedish companies do not think that they have much to gain from speaking out publicly or arguing, for instance, for openness or engagement with China. The most obvious exception is probably the debate following Ericsson CEO Börje Ekholm’s unsuccessful intervention in 2020 to put pressure on Sweden’s former trade minister, Anna Hallberg, to intervene in the run-up to the decision on blocking Huawei from the 5G rollout, in order to prevent Huawei from being excluded. According to Ekholm, Huawei’s exclusion could have resulted in China taking measures to target the interests of Swedish industry in China, including those of Ericsson.^[10] Regarding Huawei, Jacob Wallenberg, chair of the board of one of Sweden’s major investment and holding companies, also expressed dissatisfaction regarding the idea of blocking the Chinese company from Sweden’s 5G rollout, stating that “it is important that Huawei is given the opportunity to operate in Sweden as well”.[11]

Swedish media play a significant role in shaping the debate on China. China’s image in the Swedish media has deteriorated in recent years. Between 2017 and 2019, the number of editorials with a negative view of China increased significantly in four leading daily Swedish newspapers, reaching the highest level since 2008 when the summer Olympic Games were being held in Beijing.[12] Along similar lines, Swedish public opinion on China has become much more negative in recent years. Previous research has shown that the proportion of Swedes with a negative image of China increased from 52 percent to 85 percent between 2018 and 2020. Of the 14 rich industrialized countries included in the survey, Swedish people held the second most negative view of China, behind only the Japanese people.^[13] Swedish people are most critical of China’s disregard for democratic rights and its international behaviour.^[14] One possible explanation for this negative view of China is the campaign of public criticism conducted by the Chinese embassy in Stockholm and the former Chinese ambassador to Sweden, Gui Congyou, which included intense criticism of Swedish media, researchers, journalists and political parties, among others.[15] This campaign led to negative reactions, not least from Swedish media outlets, which repeatedly criticized this behaviour.[16]

Formal and informal policy coordination mechanisms enable knowledge-building on China

As China’s relevance in the world has increased, the Swedish government’s interest in China-related issues has also grown. The 2019 white paper on China raises the need to strengthen communication and collaboration between different actors in Sweden on issues related to China.^[17] In Sweden, all government decisions, including foreign policy decisions, such as positions on China-related issues, require an inter-ministerial consultation process.[18] In addition, there are informal discussions on China-related issues at the governmental level. China policy coordination mechanisms are mainly informal. For example, “Team Sweden China”, a government-initiated network,[19] promotes Sweden and Swedish interests in China, and supports Swedish companies in China, among other things.[20]

In addition to its activities in China, Team Sweden also coordinates relevant organizations in Stockholm.[21] Coordination involving exchanges with actors at different administrative levels or with critical non-political actors appears to entail mainly informal, ad hoc mechanisms. These coordination mechanisms mostly involve conversations with, for instance, the business sector, while the regional and municipal levels are not as involved. These subnational levels would, however, be likely to benefit from being engaged to a greater extent in these kinds of contexts. Nonetheless, the autonomy of Swedish local authorities in the municipalities and regions leaves plenty of space for these administrative levels to handle and decide on local and regional issues.[22] For instance, with regard to subnational relations, municipalities and regions in Sweden can independently decide to leave or sign new agreements with counterparts in, for instance, China. In recent years, many municipalities and regions in Sweden have decided to end their cooperation agreements with China, due to the negative developments concerning democracy and human rights in China, the Chinese state’s behaviour towards Sweden and Swedish nationals, and the lack of activity in these subnational cooperations. Some agreements, however, are still active.[23]

The 2019 government white paper also underlines the importance of understanding China better. It proposed the establishment of a Swedish National China Center, which was established in 2021 and aims to improve understanding of China in Sweden by carrying out research-based, policy-relevant analysis and providing guidance on issues concerning China. The main target groups for the Centre are Sweden’s Government Offices and government agencies. Other target groups include the Riksdag, municipalities and regions, academia and industry in Sweden, among others. Government funding finances most of the Centre’s activities.[24] The Centre aims to bring various Swedish actors together to discuss China-related issues, and thus contribute to informal policy coordination.

The next three major China-related challenges facing Sweden

Several key China-related controversies have already shaped and are likely to continue to shape national and public debate in Sweden in the coming year:

1. The case of Gui Minhai: In October 2015, Gui Minhai, a Swedish citizen and book publisher, was kidnapped from his holiday home in Thailand and imprisoned in China. In February 2020, Gui was sentenced to ten years in prison, according to the verdict which has not been made available, for providing intelligence overseas.^[25] Since the imprisonment of Gui, Sweden and China’s bilateral relations have deteriorated markedly.[26] In his statement of government policy in October 2022, Prime Minister Kristersson stated that the new government would “continue the efforts to secure the release” of Gui.^[27] In October 2022, in line with a decision made by the former government, a Swedish monitoring commission published a review of the efforts made by the government, the Ministry for Foreign Affairs and Sweden’s diplomatic missions to achieve the release of Gui Minhai, identifying a number of deficiencies.[28]

2. Emerging security concerns: In recent years, several isolated examples of Chinese security threats have emerged, which together have sparked a debate on security risks. For instance, as the inclusion of Huawei and ZTE in the development of Sweden’s 5G network was viewed as a security risk for Sweden, the Swedish Post and Telecommunications Board (PTS) decided in October 2020 to ban Huawei and ZTE from participating.^[29] This decision sparked strong reaction from the Chinese government, which announced that the decision would negatively affect Swedish companies operating in China and cooperation between Sweden and China more generally.[30] Chinese investments in Sweden have also received a lot of attention. Some of these have been made in critical infrastructure such as wind power, which has generated discussion on the potential risks and consequences of Chinese ownership of Swedish infrastructure and companies.[31]

3. Dependence on China: Sweden’s strategic dependence in relation to China and how to reduce it has become a more frequent topic for discussion and is likely to continue to be debated. There are few signals that Sweden will change its opposition to protectionism or its pro-free trade positions.^[32] Nonetheless, reducing unilateral dependence seems to be a key concern for the new government. In November 2022, Prime Minister Kristersson stated the following in the Statement of Government EU Policy:

• It is worrying that the EU is falling behind Asia and the United States in key economic areas. The global tech industry is currently being advanced on the west coast of the US and on the east coast of China. For this reason, the single market must be deepened, the digital single market realised and new free trade agreements concluded. Openness is the basis of growth policy. But the EU’s capacity must simultaneously increase in strategic areas where there are obvious vulnerabilities in the supply chain…. Openness must not mean unilateral dependence, much less naivety.[33]