One of the most controversial items which could come up at this week's European Union summit is the proposed lifting of a 15-year ban on arms sales to China.
A transatlantic row over the move is being fuelled by a highly charged mixture of strategic and commercial competition and old-fashioned big-power rivalry, in the face of China's rapid emergence as a potential global superpower.
The US says the ban on selling arms to China should remain
France is spearheading EU moves to lift the ban, hoping that China's rapidly expanding armed forces will offer a good market for its loss-making arms firms and that a coalition can be built with China to counterbalance the United States.
The EU embargo on weapons sales to China was imposed as a punishment after the violent suppression of the Tiananmen Square pro-democracy protests in 1989.
The United States, which still operates a similar ban of its own, has strongly opposed France's view that the time has come for such measures to be removed.
But the French, who have been rapidly improving their own ties with China, have already won the backing of most of their other fellow EU members.
It is still unclear whether they can win the necessary unanimous agreement to lift the ban at the two-day national leaders' summit starting in Brussels on Thursday, but senior EU officials have indicated their support for the move.
"Ministers have been saying 'should we continue to put China in the same category as countries like Burma or should we reconsider that in the light of what's happened in the past 15 years?'" said Chris Patten, EU Commissioner for External Affairs.
The proposal to lift the arms ban, while not yet finally agreed, was an indication of changes taking place both in the EU's relations with China and within China itself, Mr Patten told the BBC World Service programme East Asia Today.
But US Secretary of State Colin Powell said earlier this month that scrapping the embargo was not justified, because of Chinese human rights abuses.
Tension with Taiwan has brought the issue into focus
Washington said this week it is preparing to sponsor a UN resolution saying that China's human rights record has deteriorated in the past year.
Beijing has been lobbying hard to have the ban lifted, partly out of the belief that this would be seen as an important political sign that it was no longer considered an international pariah.
The real reason for the row over the proposed removal of the arms ban has less to do with human rights than with security, big business and geopolitics, say analysts.
"The embargo was imposed for human rights reasons but today it has more to do with the strategic environment," says Tai Ming Cheung, a London-based defence specialist.
"For the Americans, the concern is that any arms sold by the EU to China could be used against US troops defending Taiwan," he said.
Tensions across the Taiwan Strait are now seen as particularly high following the victory in last weekend's presidential elections of Chen Shui-bian. China accuses him of planning to steer the island towards independence - a move it says will mean war.
Lifting the arms embargo now will be tantamount to giving the Chinese approval for their threatening position over Taiwan, said James Lilley, a former US ambassador to China.
"Why pick this time to increase their missile capability when they are making moves that are not in our interests?
"Why not wait a while and use it as leverage".
National pride is also a factor.
"The French are being very French," Mr Lilley told BBC News Online.
"They've always tried to be out in front of us on China. When they recognised (the People's Republic of) China in 1964 - 15 years before us - they felt they had made a great coup".
The main reason France is encouraging the rest of Europe to strengthen its ties with China is that it shares China's own aims of building a coalition to withstand US pressure, according to Willem van Kamenade, a China-based specialist in global strategic relations.
"Both the EU and China want to build coalitions so they can say no to the US," he said.
"But the US wants to keep them divided, just as it wants to keep China and Taiwan divided. It wants to keep checks on China so it can stop it becoming a superpower in military terms."
EU arms deals are covered by a separate code of conduct, which takes in consideration aspects such as regional stability and whether or not the arms will be used for internal repression.
But critics say interpretations of the code vary so much that its efficiency is in serious doubt.
European arms firms hope that if the EU lifts the embargo it will open the way for Chinese purchases of such items as French Mirage fighter jets and German missiles.
China for its part believes such a move would give it additional bargaining power in dealing with its current main arms supplier, Russia.
Its main interest lies in acquiring more advanced military equipment from the US, and it hopes that the lifting of the EU ban would lead the US government to lift its own bans after strong pressure from US arms suppliers.