It cannot be said that China has not done anything about climate protection. No other country has invested as much in wind power and solar energy in recent years as the People’s Republic. The overall assessment of China’s role at the COP27, which ended last weekend, is nevertheless sobering. That is because China continues to refuse to pay into the climate aid fund for developing countries – and even as a feared economic superpower still somehow considers itself a developing country. But the debate over China’s status is not over, writes Christiane Kuehl in her analysis. On the contrary: It is in full swing and will likely be back at the top of the agenda at next year’s COP in Dubai.
Things are not looking rosy for the German automotive industry in China either. The more EVs are sold on the world’s largest car market, the smaller the market share of German carmakers is. Volkswagen in particular struggles to keep up with its Chinese EV competitors. A lose-lose situation seems to emerge, according to a study by the Berlin-based China Research Institute Merics, which our author Christian Domke Seidel has taken a closer look at. If German automakers continue to rely heavily on China, they are taking a geopolitical risk. If they cut back their investments in the Middle Kingdom, they risk being left behind by the Chinese competition and Tesla.
Today’s “China Perspective” column looks at a completely different kind of impossible way out. The family and social pressure on lesbians and gays not to be married weighs heavily on them. That is why many of them resort to fake marriages. But this creates other problems. The obvious solution would be same-sex marriage. But under Xi Jinping, China is further away from this than ever.
Shortly after the start of the conference, Gaston Browne, chairman of the Aosis Group of vulnerable island states, caused the first stir. He demanded that China too should contribute to the financing of climate policy. Coming from a member of the China-dominated G77 group of 134 developing countries, that was quite a statement. Browne had to row back, but the signal was sent (Climate.Table reported). China’s negotiator Xie Zhenhua then quickly clarified that his country would support a mechanism for compensation payments for damage in poor countries – but by no means financially (China.Table reported).
But Xie was unable to put a stop to the debate behind the scenes about whether China, as an ambitious superpower, can continue to avoid any commitments to finance climate aid in the long term. It became one of the central discussions at COP27, which ended Sunday, and the debate over China’s status is not over. It will continue at COP28 in Dubai in November 2023.
Speaking to China.Table on the sidelines of the China Time conference in Hamburg on Wednesday, German negotiator, State Secretary and Special Envoy for International Climate Action, Jennifer Morgan, called the EU’s sudden push for a climate damage compensation fund for the poorest countries “one of the most important moments of COP.” It was very important that there was “a crack in the wall between developed and developing countries” in Sharm el Sheikh by deciding on a loss and damage fund, said Morgan, who together with Chilean Environment Minister Maisa Rojas acted as “facilitators” to mediate in this difficult area. “That alone made it worth doing.”
In the end, the EU prevailed in tough negotiations to pay out the fund’s money only to particularly vulnerable developing countries. However, Brussels and its allies were forced to abandon the desired expansion of donor countries to include countries such as China and the Gulf states. In the final document of COP27, the wording does not rule out an expansion of benefactors. It is now up to a transition committee to propose new funding sources for loss & damage. (Climate.Table reported).
China already knows it needs to do more, said Morgan, who also spoke at COP27 with China’s climate czar Xie Zhenhua, whom she has known for many years. “I have a good working relationship with Xie Zhenhua,” Morgan said at a panel discussion at the conference. “We may not always agree. But we can tell each other that.” The seasoned Xie is well-respected internationally, and US climate negotiator John Kerry is also said to get along well with him.
Like Kerry, Xie largely went unnoticed at this COP. What attracted the most attention was his promise that China was working on a methane plan that would also become part of the long-term climate targets. The greenhouse effect of methane is four times greater than that of carbon dioxide, and in China, it emanates from wet rice fields, among other sources. Previously, China only worked with carbon reduction targets. “You can tell from this that there is movement,” Morgan said.
Officially, however, China maintains its line. The industrialized countries have “developed countries have still not fulfilled their commitment to providing 100 billion US dollars in climate finance to developing countries every year,” foreign office spokeswoman Mao Ning said on Monday after the conclusion of COP – as if the debate about China’s role in this financing had never existed.
China also emits more greenhouse gases than any other country in the world due to its size, around 30 percent of global emissions. Per capita, each Chinese emits about 7 tons of carbon dioxide per year, said renowned climate expert Mojib Latif at the China Time conference. Every German emits 9 tons a year, every Indian only 2 tons. So China closes the gap to industrialized countries, and that includes cumulative, so-called “historical emissions” – which are so important because carbon dioxide remains in the atmosphere for centuries. “The US has emitted the most cumulatively, with a 20 percent share,” Latif said. “But China is already number 2, with 11 percent.” All of this further weakens China’s developing country argument.
China wants to be carbon-neutral by 2060 – its target date lies between most industrialized countries (2050) and developing countries such as India (2070). China’s emissions are to fall by 2030 at the latest. However, China did not specify the amount that will be blown into the air by then. However, many experts believe that China’s emissions could peak earlier and are urging Beijing to be more ambitious.
Typically, China promises too little and then over-delivers, said climate expert Liu Hongqiao at the China.Time conference in Hamburg. Liu has been reporting on China’s climate policy for ten years, among others, for the specialist service Carbon Brief. China will not issue a more ambitious target until it is absolutely certain it has passed its emissions peak. “Then they might do a new calculation.”
It’s an approach that does not fit into the world of climate COPs, which envision ever-increasing commitments – and strive for as much transparency as possible. China’s system lacks transparency, Jacob Werksman of the EU Commission’s Directorate-General for Climate Action pointed out at the conference: “That makes it hard to see China’s climate action and be inspired by it.”
The People’s Republic certainly sees itself as a state that helps others with climate protection – and also does a lot to counter the climate crisis. China owns almost 40 percent of global wind energy capacity and 33 percent of global photovoltaic capacity, China’s Consul General in Hamburg Cong Wu emphasized at the China.Time conference. Beijing promotes South-South cooperation and helps developing countries through greener projects in the Silk Road Initiative (“Green BRI”) and its new Global Development Initiative.
So what is next? “We will try to get China out of the political framing it has been hiding behind for 30 years,” Werksman said. Beijing used its 1992 classification as a developing country to avoid responsibility. “But now after COP27, it’s becoming more visible and more apparent that this is no longer possible,” Jennifer Morgan said. And it is a bit like soccer: After COP is before COP.
Unconditional support seems to have been replaced by healthy skepticism. For a long time, the German government strongly supported the economic activities of German automakers in China. Members of the brands’ executive boards regularly accompanied politicians on their trips to the People’s Republic.
But between politicians and corporate headquarters, the ideas of the best course for the auto industry are increasingly diverging. This has become clear in recent weeks. In its strategy paper, the German Foreign Office emphasizes the reduction of risky dependencies (China.Table reported). Meanwhile, the Ministry of Economics does not wait for the strategy and is already creating facts. It is cutting back its support for business in China (China.Table reported). In contrast, Ralf Brandstaetter, Volkswagen’s Head of China Operations, wants to invest even more than before in China to maintain market share. Clearly, this no longer fits together.
The position of politicians is now supported by a study by the China research institute Merics. The experts at Merics emphasize that the government and manufacturers have the same goal: the long-term success of German automakers. But the fact that this can be achieved with higher investments in China is by no means certain, they say. And that is because of the mobility transformation.
According to Merics, the big problem is that the Chinese economy benefits much more than the German economy from the continued involvement of German automakers. This has three reasons.
But even if all these problems are solved, the continued success of German manufacturers in China is not a foregone conclusion, despite billions of dollars in investment. Merics calculates that the market share of German manufacturers in the Chinese new car market dropped by 24 percent in January to May 2022 alone.
The more EVs sold, the smaller the market share of German companies is. Only four of the top 15 EV manufacturers are not entirely Chinese. Namely, in second place SAIC-GM-Wuling (9.6 percent market share) and Tesla (7.0 percent) in third place. With SAIC-VW (1.8 percent) and FAW-VW (1.6 percent), Volkswagen finds itself in 14th and 15th place. With a market share of 29.3 percent, market leader BYD leads the ranking unchallenged.
Merics believes that German brands are trying to compensate for their weaknesses with joint ventures and partnerships. BMW, Mercedes and Volkswagen, for example, are cooperating with Baidu. The Germans are also courting the rest of the who’s who of Chinese tech giants, from Alibaba to Tencent to Xiaomi. Through these investments, the brands hope to gain access to the EV value chain, which Chinese companies currently dominate. Be it the battery, semiconductors or software.
Merics points out that these investments could help German manufacturers avoid falling behind on the global automotive market. On the one hand, with new technologies, and on the other, with market access. Less committed companies could quickly lose the latter in the event of geopolitical tensions. But this is also precisely a question of political convictions.
Before the Russian attack on Ukraine, Renault sold 18 percent of its cars in Russia. As a result of the sanctions, the brand had to sell its business to the Russian manufacturer Avtovaz for a symbolic euro. Such scenarios could theoretically happen in China as well, Merics elaborates. Added to this are economic policy considerations. After all, high spending on research and development also benefits Chinese partners.
Furthermore, it is far from certain that research results achieved in China – for example in the field of artificial intelligence or autonomous driving – can be used outside the country at all. The People’s Republic has strict rules regarding the export of technology and the cross-border transfer of data. Already, profits made by German manufacturers in China often stay there as reinvestment, because transferring them to Germany is not as easy. That, at least, is a glimmer of hope. Because the reverse is true. If the investments of German brands dry up, this primarily harms the Chinese economy.
Apple contract manufacturer Foxconn apologized to workers at its Zhengzhou factory after violent clashes in recent days. On Thursday, Foxconn said a technical error had caused workers to receive incorrect paychecks. “We apologize for an input error in the computer system and guarantee that the actual pay is the same as agreed and the official recruitment posters,” said a company statement.
The company also offered a cash reward of 10,000 yuan (1,400 euros) to anyone who left the factory premises peacefully. Riots erupted at the factory on Tuesday and Wednesday (China.Table reported). Employees were outraged after their paychecks were lower than promised when they were hired. In an attempt to bring the situation under control, management and the provincial government dispatched security forces in white protective suits to the plant premises at the beginning of the week. However, this only added to the escalation. On social media, videos emerged showing police in white suits physically assaulting protesting workers.
Employees are also upset because they are not allowed to leave the plant due to Covid protection rules. The largest factory site in the world can accommodate up to 350,000 employees. In some cases, Covid-positive workers were expected to sleep in the same room with negative co-workers. The supply situation was also reportedly poor (China.Table reported).
In general, life in closed loops of large factories is considered unpleasant. Foxconn is currently trying to replace 100,000 employees in Zhengzhou who already fled the plant in October (China.Table reported). The production of Apple products for the Christmas season depends on the seamless operation of the site. fin
This is what the situation in Beijing is like at the moment. The authorities have not imposed a lockdown on the capital. Nevertheless, stores, restaurants, malls and even parks are all closed. And so a few hardy women resort to practicing tai chi in front of the park entrance – nothing compared to what happens here under normal conditions.
It cannot be said that China has not done anything about climate protection. No other country has invested as much in wind power and solar energy in recent years as the People’s Republic. The overall assessment of China’s role at the COP27, which ended last weekend, is nevertheless sobering. That is because China continues to refuse to pay into the climate aid fund for developing countries – and even as a feared economic superpower still somehow considers itself a developing country. But the debate over China’s status is not over, writes Christiane Kuehl in her analysis. On the contrary: It is in full swing and will likely be back at the top of the agenda at next year’s COP in Dubai.
Things are not looking rosy for the German automotive industry in China either. The more EVs are sold on the world’s largest car market, the smaller the market share of German carmakers is. Volkswagen in particular struggles to keep up with its Chinese EV competitors. A lose-lose situation seems to emerge, according to a study by the Berlin-based China Research Institute Merics, which our author Christian Domke Seidel has taken a closer look at. If German automakers continue to rely heavily on China, they are taking a geopolitical risk. If they cut back their investments in the Middle Kingdom, they risk being left behind by the Chinese competition and Tesla.
Today’s “China Perspective” column looks at a completely different kind of impossible way out. The family and social pressure on lesbians and gays not to be married weighs heavily on them. That is why many of them resort to fake marriages. But this creates other problems. The obvious solution would be same-sex marriage. But under Xi Jinping, China is further away from this than ever.
Shortly after the start of the conference, Gaston Browne, chairman of the Aosis Group of vulnerable island states, caused the first stir. He demanded that China too should contribute to the financing of climate policy. Coming from a member of the China-dominated G77 group of 134 developing countries, that was quite a statement. Browne had to row back, but the signal was sent (Climate.Table reported). China’s negotiator Xie Zhenhua then quickly clarified that his country would support a mechanism for compensation payments for damage in poor countries – but by no means financially (China.Table reported).
But Xie was unable to put a stop to the debate behind the scenes about whether China, as an ambitious superpower, can continue to avoid any commitments to finance climate aid in the long term. It became one of the central discussions at COP27, which ended Sunday, and the debate over China’s status is not over. It will continue at COP28 in Dubai in November 2023.
Speaking to China.Table on the sidelines of the China Time conference in Hamburg on Wednesday, German negotiator, State Secretary and Special Envoy for International Climate Action, Jennifer Morgan, called the EU’s sudden push for a climate damage compensation fund for the poorest countries “one of the most important moments of COP.” It was very important that there was “a crack in the wall between developed and developing countries” in Sharm el Sheikh by deciding on a loss and damage fund, said Morgan, who together with Chilean Environment Minister Maisa Rojas acted as “facilitators” to mediate in this difficult area. “That alone made it worth doing.”
In the end, the EU prevailed in tough negotiations to pay out the fund’s money only to particularly vulnerable developing countries. However, Brussels and its allies were forced to abandon the desired expansion of donor countries to include countries such as China and the Gulf states. In the final document of COP27, the wording does not rule out an expansion of benefactors. It is now up to a transition committee to propose new funding sources for loss & damage. (Climate.Table reported).
China already knows it needs to do more, said Morgan, who also spoke at COP27 with China’s climate czar Xie Zhenhua, whom she has known for many years. “I have a good working relationship with Xie Zhenhua,” Morgan said at a panel discussion at the conference. “We may not always agree. But we can tell each other that.” The seasoned Xie is well-respected internationally, and US climate negotiator John Kerry is also said to get along well with him.
Like Kerry, Xie largely went unnoticed at this COP. What attracted the most attention was his promise that China was working on a methane plan that would also become part of the long-term climate targets. The greenhouse effect of methane is four times greater than that of carbon dioxide, and in China, it emanates from wet rice fields, among other sources. Previously, China only worked with carbon reduction targets. “You can tell from this that there is movement,” Morgan said.
Officially, however, China maintains its line. The industrialized countries have “developed countries have still not fulfilled their commitment to providing 100 billion US dollars in climate finance to developing countries every year,” foreign office spokeswoman Mao Ning said on Monday after the conclusion of COP – as if the debate about China’s role in this financing had never existed.
China also emits more greenhouse gases than any other country in the world due to its size, around 30 percent of global emissions. Per capita, each Chinese emits about 7 tons of carbon dioxide per year, said renowned climate expert Mojib Latif at the China Time conference. Every German emits 9 tons a year, every Indian only 2 tons. So China closes the gap to industrialized countries, and that includes cumulative, so-called “historical emissions” – which are so important because carbon dioxide remains in the atmosphere for centuries. “The US has emitted the most cumulatively, with a 20 percent share,” Latif said. “But China is already number 2, with 11 percent.” All of this further weakens China’s developing country argument.
China wants to be carbon-neutral by 2060 – its target date lies between most industrialized countries (2050) and developing countries such as India (2070). China’s emissions are to fall by 2030 at the latest. However, China did not specify the amount that will be blown into the air by then. However, many experts believe that China’s emissions could peak earlier and are urging Beijing to be more ambitious.
Typically, China promises too little and then over-delivers, said climate expert Liu Hongqiao at the China.Time conference in Hamburg. Liu has been reporting on China’s climate policy for ten years, among others, for the specialist service Carbon Brief. China will not issue a more ambitious target until it is absolutely certain it has passed its emissions peak. “Then they might do a new calculation.”
It’s an approach that does not fit into the world of climate COPs, which envision ever-increasing commitments – and strive for as much transparency as possible. China’s system lacks transparency, Jacob Werksman of the EU Commission’s Directorate-General for Climate Action pointed out at the conference: “That makes it hard to see China’s climate action and be inspired by it.”
The People’s Republic certainly sees itself as a state that helps others with climate protection – and also does a lot to counter the climate crisis. China owns almost 40 percent of global wind energy capacity and 33 percent of global photovoltaic capacity, China’s Consul General in Hamburg Cong Wu emphasized at the China.Time conference. Beijing promotes South-South cooperation and helps developing countries through greener projects in the Silk Road Initiative (“Green BRI”) and its new Global Development Initiative.
So what is next? “We will try to get China out of the political framing it has been hiding behind for 30 years,” Werksman said. Beijing used its 1992 classification as a developing country to avoid responsibility. “But now after COP27, it’s becoming more visible and more apparent that this is no longer possible,” Jennifer Morgan said. And it is a bit like soccer: After COP is before COP.
Unconditional support seems to have been replaced by healthy skepticism. For a long time, the German government strongly supported the economic activities of German automakers in China. Members of the brands’ executive boards regularly accompanied politicians on their trips to the People’s Republic.
But between politicians and corporate headquarters, the ideas of the best course for the auto industry are increasingly diverging. This has become clear in recent weeks. In its strategy paper, the German Foreign Office emphasizes the reduction of risky dependencies (China.Table reported). Meanwhile, the Ministry of Economics does not wait for the strategy and is already creating facts. It is cutting back its support for business in China (China.Table reported). In contrast, Ralf Brandstaetter, Volkswagen’s Head of China Operations, wants to invest even more than before in China to maintain market share. Clearly, this no longer fits together.
The position of politicians is now supported by a study by the China research institute Merics. The experts at Merics emphasize that the government and manufacturers have the same goal: the long-term success of German automakers. But the fact that this can be achieved with higher investments in China is by no means certain, they say. And that is because of the mobility transformation.
According to Merics, the big problem is that the Chinese economy benefits much more than the German economy from the continued involvement of German automakers. This has three reasons.
But even if all these problems are solved, the continued success of German manufacturers in China is not a foregone conclusion, despite billions of dollars in investment. Merics calculates that the market share of German manufacturers in the Chinese new car market dropped by 24 percent in January to May 2022 alone.
The more EVs sold, the smaller the market share of German companies is. Only four of the top 15 EV manufacturers are not entirely Chinese. Namely, in second place SAIC-GM-Wuling (9.6 percent market share) and Tesla (7.0 percent) in third place. With SAIC-VW (1.8 percent) and FAW-VW (1.6 percent), Volkswagen finds itself in 14th and 15th place. With a market share of 29.3 percent, market leader BYD leads the ranking unchallenged.
Merics believes that German brands are trying to compensate for their weaknesses with joint ventures and partnerships. BMW, Mercedes and Volkswagen, for example, are cooperating with Baidu. The Germans are also courting the rest of the who’s who of Chinese tech giants, from Alibaba to Tencent to Xiaomi. Through these investments, the brands hope to gain access to the EV value chain, which Chinese companies currently dominate. Be it the battery, semiconductors or software.
Merics points out that these investments could help German manufacturers avoid falling behind on the global automotive market. On the one hand, with new technologies, and on the other, with market access. Less committed companies could quickly lose the latter in the event of geopolitical tensions. But this is also precisely a question of political convictions.
Before the Russian attack on Ukraine, Renault sold 18 percent of its cars in Russia. As a result of the sanctions, the brand had to sell its business to the Russian manufacturer Avtovaz for a symbolic euro. Such scenarios could theoretically happen in China as well, Merics elaborates. Added to this are economic policy considerations. After all, high spending on research and development also benefits Chinese partners.
Furthermore, it is far from certain that research results achieved in China – for example in the field of artificial intelligence or autonomous driving – can be used outside the country at all. The People’s Republic has strict rules regarding the export of technology and the cross-border transfer of data. Already, profits made by German manufacturers in China often stay there as reinvestment, because transferring them to Germany is not as easy. That, at least, is a glimmer of hope. Because the reverse is true. If the investments of German brands dry up, this primarily harms the Chinese economy.
Apple contract manufacturer Foxconn apologized to workers at its Zhengzhou factory after violent clashes in recent days. On Thursday, Foxconn said a technical error had caused workers to receive incorrect paychecks. “We apologize for an input error in the computer system and guarantee that the actual pay is the same as agreed and the official recruitment posters,” said a company statement.
The company also offered a cash reward of 10,000 yuan (1,400 euros) to anyone who left the factory premises peacefully. Riots erupted at the factory on Tuesday and Wednesday (China.Table reported). Employees were outraged after their paychecks were lower than promised when they were hired. In an attempt to bring the situation under control, management and the provincial government dispatched security forces in white protective suits to the plant premises at the beginning of the week. However, this only added to the escalation. On social media, videos emerged showing police in white suits physically assaulting protesting workers.
Employees are also upset because they are not allowed to leave the plant due to Covid protection rules. The largest factory site in the world can accommodate up to 350,000 employees. In some cases, Covid-positive workers were expected to sleep in the same room with negative co-workers. The supply situation was also reportedly poor (China.Table reported).
In general, life in closed loops of large factories is considered unpleasant. Foxconn is currently trying to replace 100,000 employees in Zhengzhou who already fled the plant in October (China.Table reported). The production of Apple products for the Christmas season depends on the seamless operation of the site. fin
This is what the situation in Beijing is like at the moment. The authorities have not imposed a lockdown on the capital. Nevertheless, stores, restaurants, malls and even parks are all closed. And so a few hardy women resort to practicing tai chi in front of the park entrance – nothing compared to what happens here under normal conditions.
