– Nationalisms, ideological wars, surcharges… and the White House turned upside down. An ideal/necessary context to recover relations with China?
A.C.S. – A great opportunity is opening up. Portugal and China have had relations since the 15th century; essential for trade between China, Japan, and other Asian countries. In this growing geopolitical and geoeconomic fragmentation, Trump targets not only Canada and Mexico, but above all Europe and China. From the lessons of history, we understand that in tariff wars, everyone loses – especially the United States. We must defend trade and international relations; and China and the European Union together represent 30% of international trade. Portugal and Europe must intensify political, technological, and commercial relations with China, in multiple areas. I’m very pleased with investments such as CALB’s – one of the world’s largest battery manufacturers: 2.2 billion euros in the Sines complex; which shows the capacity to combine the strengths of China and Portugal. I see great opportunities in renewable energies, batteries, and electric vehicles. China will inevitably penetrate those value chains.
– After Covid and the war in Ukraine – has everything changed? Ideology, strategy; or pressure from the United States?
A.C.S. – Absolutely… due to Washington’s influence. Issues of national security and defense were raised; but, obviously, procedures and regulations can be developed. It is impossible to regulate technology worldwide, to build walls and borders; but what emanates from the United States is the transformation of trade and technology into geopolitical weapons; waging war on certain companies and institutions; with excessive protectionism and nationalism. China is a major investor in an entire range of technologies vital to Portugal and Europe; the world’s largest investor in renewable energy. In 2024, it produced 60% of the world’s electric vehicles, 80% of the batteries, and 95% of the components for the solar industry; and added 330 gigawatts to its energy matrix – seven times more than the United States. Portugal also changed its energy matrix: it started the 20th century with an 89% dependency on fossil fuels; today it’s at 65%; and 71% of electricity comes from renewables. We invested heavily in wind and solar energy; in line with what’s happening in China. Portugal can be a technological, energy, and logistics platform for all those value chains.
– Will three months of Trump undo the Sinophobia?
A.C.S. – I wouldn’t say it’s enough; there are always fringe elements of the political spectrum waiting for last-minute changes – classic Europe. What I defend is what Merkel defended. There’s a famous photo from the G7 – 2016 – in which Trump looks like a cheeky, misbehaving child; with the German chancellor leaning over him, the French president exasperated, the Japanese prime minister… From then on, Merkel said Europe had to rely on itself. Right now, there’s an impressive wave in Europe, which is reorganizing itself. It lost a lot of time, but it is a major global bloc, with 500 million consumers – crucial to China. Portugal is a soft power, with influence in South America, Africa, and Asia; and can use all those platforms.
– Assuming the bridge to China?
A.C.S. – Exactly; very important for global trade, exports/imports; and for replacing what may not go well from the United States. China and the European Union are the blocs that can minimize climate change and continue to invest in renewable energies. Portugal has just approved four major projects in this area; we have the largest lithium mines in Europe; and one of the largest copper mines – there is no electricity without copper, nor electric transport without lithium. We want to secure the entire lithium value chain; from extraction, refining, and processing – counting on China – and Haitong has a major project in the field of electric cables – submarine cables are also vital. There is a second aspect, geopolitical: the United States can damage China’s GDP by between 15% to 51%, but only with the support of its allies. If Europe is not on their side, they only harm China’s GDP by 5% to 7%. China can damage 4% to 5% of the US GDP – tit for tat. It is crucial for Europe to work with China; and in this balance between energy and geopolitics, a new cycle in Portugal-China relations may emerge.
-Are we really at risk of the Thucydides Trap?
A.C.S. – I have no doubt whatsoever. Before coming here, I was reading the book that former UK Prime Minister Gordon Brown published with Ahmed El-Erian, a major American economist: Permacrisis – a crisis sustained over time, triggered by random factors, that then consolidates and can change everything. On one occasion when Xi Jinping was in the UK, Brown asked him what the biggest risk China faced in the 21st century was; and the answer was extraordinary: falling into the Thucydides Trap. The Greek historian wrote about the Peloponnesian War 2,500 years ago, one of the most extraordinary books ever, explaining that a rising empire is always at risk of armed conflict with the hegemonic empire. The numbers are clear: in 1995, China’s GDP represented 2% of global GDP; today it’s 19% – heading toward 20%. Working with China means protecting the economy, supply chains, exports/imports, trade, peace, and stability. We must avoid, at all costs, the Thucydides Trap.
– Xi Jinping says he will avoid it… and Trump?
A.C.S. – Trump is a leader with feet of clay; and economic policies that are a cocktail of contradictions. Daron Acemoglu, Nobel Laureate in Economics, published a devastating article in the Financial Times, about the effects of combining tariff wars, erosion of institutions, total deregulation, and the end of the antitrust law – the Sherman Act of 1911 – precisely created to control the superpower of Standard Oil and the railroads. Elon Musk erased it; and today, the tech oligopoly is taking over the White House. In diplomacy there’s the “crazy man” theory, which promotes fear and insecurity in negotiation partners. It may work in diplomacy; transferred to the economy it’s a disaster.
– How does Portugal view the diaspora in Macau?
A.C.S. – There is an immense intangible heritage here.
– That is not capitalized on…
A.C.S. – Portugal, in terms of its political functioning, has to learn from Chinese leadership, which has clear short-, medium-, and long-term policies. In Portugal, we do not perceive the importance of Macau, the connection to China, this historical relationship and positioning in the Greater Bay Area. And, in recent years, there has been strategic retreat. I have always opposed that, including on the issue of the 5G network. At the time, there was an investigation by British intelligence services into Huawei, which very clearly proved there was no threat to national security. We cannot follow US ideas, especially when they have no sustainability; but we did – and we must reverse that. We must reconnect, starting with Macau, with the Greater Bay and China; not just with Portuguese companies, but from all Lusophone countries we can attract. Bring them here, and take from China to Portugal – and the rest of the world. We are at a crucial stage in which the energy order, directed by petro-states, will begin to be managed by electro-states – and the largest in the world is China. It is essential for Europe to encourage cross-fertilization of projects and ideas.
– What needs to happen for Portuguese companies to look toward Macau/Greater Bay? Political context, or business awareness?
A.C.S. – A top-down strategy is needed, with political momentum; then bottom-up, with companies; starting with Macau and the Greater Bay. There are several areas where Portugal is relatively advanced; for example, in software and information technologies; it is also advancing in Artificial Intelligence, although China is the global leader in that field. There could be projects in China’s communication with the rest of the world; for example, via the geography of submarine cables, where Portugal’s centrality is absolutely vital. The whole area of biotechnology is developing; research in health, cutting-edge clinical care, and new digital technologies in biological products. We need to transform the economic model based on the production of polluting products into one based on biological products – circularity between economy and bioeconomy. Portugal has interesting projects that can be scaled up; but the scale available in the Greater Bay is what matters. This is vital in an economy like Portugal’s, which has few companies large enough for what we are already doing.
– What can be done in Macau to support this?
A.C.S. – Map all the intersecting networks that can be developed between Macau and the Greater Bay, and from Macau to the Portuguese economy; identify sectors and players on the Chinese side, the Portuguese side, and the Macau community. But we have to work with very concrete objectives; often the major failure: we talk a lot; but when it comes to the action plan, follow-up, and delivery, we fall very short.
– Read opportunities and build networks…
A.C.S. – Exactly. Networks are now crucial because the connectivity paradigm will dominate this century; everything will operate through networks and the distribution of knowledge, energy, technology, and financing. It is vital to ensure that also happens here.
