Europe is currently debating about Chinese electric cars. Are we facing an import tsunami? Do we have to defend ourselves – and if so, with what? The EU has launched an anti-subsidy investigation, which could ultimately result in punitive tariffs. Chinese manufacturers are not pleased. But they want to tap into the European market regardless.
Chery is one such brand targeting an EU market launch in 2024. The company plans to start in Spain, with Germany following in the third quarter, explains Vice President of Chery International Charlie Zhang in an interview with Julia Fiedler. Chery wants to offer not only EVs but also combustion engines and plug-in hybrids. Zhang also expressed his surprise at how poorly developed Germany’s electric charging infrastructure is.
The number of cancer cases in China is rising disproportionately compared to the West. The number of deaths, in particular, is above average. Joern Petring explains that this negative development has unleashed new forces. China has triggered a faster development of new drugs and diagnostic procedures from which the West could benefit. One of the new drugs from the People’s Republic has already been approved in the United States. Other regions and other drugs are likely to follow.
According to Chery’s own figures, exports in 2023 stood at around 700,000 cars. How many countries are you currently exporting vehicles to?
We are currently active in over 80 countries and regions. However, we will be even bigger in 2024 because we plan to expand into Europe and Germany in particular. We are taking this step by step. First, we are launching our brand in Spain, followed by Italy and the United Kingdom. We will probably not enter the German market until the third quarter of 2024.
Why so late? Chery has been operating a development center in Germany since 2018, but their cars are not yet on the German market. They were supposed to be launched in the spring…
We want to make sure that we are well prepared. Four key factors are crucial: our products, the dealership network, marketing and branding, as well as service and the availability of spare parts. All of this needs to be in place before we launch our brands.
Do you already have contracts with German dealerships?
We are currently in very close talks with a number of potential or future major distributor groups.
But you haven’t signed any contracts yet?
Not yet. But it will very likely happen soon.
What kind of cars will you be launching on the German market?
We want to offer a range of electric cars. However, we are also aware that vehicles with combustion engines still account for a large proportion of total sales in Germany. That’s why we want to offer a comprehensive solution: Internal combustion engines, battery electric vehicles and plug-in hybrids.
Chinese EVs have been garnering a lot of attention recently and interest is high. Don’t you think you’ll dilute your portfolio if you also offer combustion engines?
We thought about this question a lot. Several other Chinese brands, such as BYD and Nio, only offer EVs. However, we aim to be big. In China, Chinese OEMs (car manufacturers) now have an overall market share of more than 50 percent. When it comes to electric cars, the share of Chinese brands is even over 80 percent. Chinese manufacturers are becoming more and more competitive. They are launching many EVs on the market – not just EVs, but also internal combustion vehicles. We cannot neglect this significant market segment.
Do German manufacturers have to fear that Chinese EVs will flood the market like a tsunami?
I don’t think that’s an appropriate description for the nature of the competition. For decades, German brands such as BMW, Mercedes, Audi and Porsche have dominated the premium brand sector. German brands, including Volkswagen China, have sold millions of cars every year. But right now, Chinese carmakers are getting bigger and stronger. We need a level playing field. Germany is a developed nation that does a lot of business in China. Now, the Chinese manufacturers are offering their German customers good cars. I don’t think it’s a tsunami; German carmakers are still leading in many aspects.
However, the qualities German car manufacturers have always been known for may no longer be as important in the future when cars become smartphones on wheels. How do you see the German car industry?
Let me put it this way: There is a conventional “old strand”, it stands for the combustion engines, the last century. German car manufacturers are pretty good here. When it came to engines and transmissions, it was difficult to catch up. Then there is the new strand, represented by battery-electric vehicles. Batteries, electric motors, electric controls, intelligent cockpits, autonomous driving, all these technologies. The Chinese manufacturers have recognized an opportunity here and have tried to be strong in this respect.
What are the impacts of China’s use of new technologies?
If you look at the gap between Chinese and German manufacturers, it has definitely narrowed. But when it comes to the fundamentals of car manufacturing, durability, reliability and quality, German manufacturers are still leading by a wide margin.
What does that mean?
There are still a lot of things we have to learn. Volkswagen has been our teacher for many, many decades. Our CEO used to work for Volkswagen. He always tells us that we must learn from German quality and how they manufacture cars.
Nevertheless, the boardrooms in Wolfsburg and Stuttgart are shaking.
This is a challenging moment for German car manufacturers. It’s hard to imagine when you’ve been a leader for many years, but now a new era is dawning. The era of smartphones on wheels. It is different. The way we compete and the way they build and develop their products is changing – and, of course, that means a certain challenge. But I still believe that the two sides can complement each other perfectly. Why shouldn’t we build highly complementary partnerships?
Don’t you think a certain degree of industrial independence is important for both countries?
If you look at our factory, you will discover many devices and machines manufactured in Germany, Italy and Japan. We buy and use many German machines and equipment. Of course, development requires a rethink. In the past, China exported toys, clothing and, above all, cheap products. And suddenly China is not only offering toys, but also cars. I think we have to adapt to this new reality, this new normality.
You are not only responsible for Europe, but also for other parts of the world. I have heard that you are particularly successful in Mexico.
We have established subsidiaries in various countries. In 2022, we launched our brands in Mexico. We currently sell around 4,000 to 5,000 vehicles there every month.
The US government is not thrilled with your activities in Mexico. The US has high tariffs on EVs manufactured in China. The government fears that you could now import your vehicles into the United States through the back door by producing them in Mexico. What is your stance on this?
The United States-Mexico-Canada Agreement (USMCA), the successor to NAFTA, has been in force in North America since 2020. The regulations regarding localization are stricter. The United States wanted to set higher standards for local production in Mexico. The Mexican market is currently big enough for us – it is a large market of more than 1.2 million vehicles. On the other hand, Mexico also has a number of free trade agreements with other countries in South America and even Europe. In the medium term, we can produce in Mexico and export to other countries.
So also in the US?
We hope that we can use the free trade agreements to manufacture in Mexico and export to the United States, especially electric cars. But that is not our immediate goal.
The EU has also started looking into anti-dumping duties on Chinese EVs. The issue is allegedly irregular subsidies from the Chinese leadership. What does this mean for you?
I think it is a regrettable decision that the EU has launched an anti-subsidy investigation to regulate Chinese cars. This will definitely have a negative impact on the sales of Chinese EVs. We can’t change that; we have to adapt to it.
The German government, in turn, unexpectedly discontinued subsidies for electric cars at the end of last year. How has this affected your company?
That is why we will also offer cars with combustion engines. We can’t just focus on the EV market. At just under 20 percent of new registrations in 2023, it is still relatively small. We want to introduce a robust product portfolio that includes combustion engines, plug-in hybrids and electric vehicles because we want to target the mass market. If you look at Europe as a whole, the individual markets are also very different.
Did you expect Germany’s electric market to develop faster?
Everyone thought that Germany, the largest economy with the largest market in Europe, would promote electrification and try to achieve zero emissions. But now, the German government has even canceled subsidies for electric cars. I believe electromobility has three key factors: affordability, battery range and infrastructure. If these three key factors are not in place, it will be very difficult to achieve 100 percent electrification. I have been traveling around Frankfurt, Munich, and Cologne, looking for charging stations on the streets. To be honest, it was very difficult to find many. I don’t know how the government plans to promote the infrastructure nationwide or in Europe. But if the infrastructure is missing, how can you talk about only allowing zero-emission cars by 2035?
Charlie Zhang (张升山) is Executive Vice President of Chery International and Assistant President of the Chery Automobile Group. He previously held the position of General Manager of the Central and South America region. Zhang has worked for the Chinese car manufacturer for more than 15 years.
China has a cancer problem. According to a new study by the state-run Chinese Center for Disease Control and Prevention (CDC), the number of cancer deaths in China has increased by 21.6 percent to almost 2.4 million each year between 2005 and 2020. Cancer has been the most common cause of death in the People’s Republic since 2010.
Along with the rising number of deaths, these are the most important findings of the study published in December 2023:
China has long had the highest number of cancer deaths in the world. However, the CDC researchers warn that the country’s mortality rates may even be underestimated due to the limited data available. They urge the Chinese government to make every effort to reduce the burden of cancer. This includes the funding of cost-effective cancer screening and vaccination programs as well as the implementation of a strict tobacco control policy.
Beijing is not idle. Public health policymakers have set themselves the goal of increasing the overall survival rate of cancer patients by ten percent by 2025. The aim is to reduce premature mortality due to non-communicable diseases, including cancer, by 30 percent by 2030.
Scientific breakthroughs, however, give reason to hope that China will not only be able to get its own problems under control in the medium term, but also contribute to solving the global cancer problem.
Chinese companies have made progress in the development of new drugs. Some of them are now also being used in the West; for example, the approval of the drug Toripalimab in the United States recently caused a stir. The US Food and Drug Administration (FDA) approved the drug developed by Shanghai Junshi Biosciences for the treatment of nasopharyngeal carcinoma (NPC) in October. NPC is an aggressive type of cancer that starts behind the nose in the upper part of the throat. Toripalimab is the first and currently only FDA-approved drug for the treatment of this type of cancer.
A few weeks ago, Dizal, a biopharmaceutical company from Jiangsu Province, also presented a new, promising drug. Sunvozertinib has shown good results in the treatment of a certain type of lung cancer. In a phase 2 trial involving 104 patients in advanced stages of the disease, sunvozertinib showed significantly higher effectiveness than all previous candidates.
There are numerous similar reports on promising drugs from China. Researchers there have also made progress in developing and applying AI-based image recognition systems used in oncology. These, too, will find their way to the West. The DAMO Academy, a research institute of the Alibaba Group, has recently presented a new AI-supported tool that can recognize early signs of pancreatic cancer. Using CT scans, the new tool called PANDA can identify whether a patient has the disease even more accurately than radiologists.
The State Council has instructed highly indebted local governments and state banks in twelve Chinese regions to postpone or cancel some state-funded infrastructure projects. This was reported by Reuters, citing insiders. The directive concerns projects where less than half of the planned investments have been completed – including motorways, the construction and expansion of airports and local transport projects.
Some projects are exempt, for instance, projects approved by the central government in Beijing or the construction of affordable housing. The State Council has not yet made the directive public.
Over the past few months, China has been trying to get a grip on its municipal debt, which has now reached the equivalent of around 11.94 trillion euros. According to the latest available data, it corresponded to 76 percent of gross domestic product in 2022. In 2019, it was only 62 percent.
According to Reuters, Beijing had already targeted the twelve regions in the fall of 2023. At that time, the State Council had already instructed local governments to stop “problematic” public-private partnership projects and imposed investment restrictions. The twelve regions in question include the provinces of Liaoning and Jilin in the northeast, Guizhou and Yunnan in the southwest, and Tianjin and Chongqing. These regions have been instructed to make every effort to reduce their “debt risk to a low and medium level,” sources told Reuters. However, the directive did not specify how to measure debt reduction.
According to official figures, China’s economy achieved GDP growth of 5.2 percent in 2023, slightly above the official target of around five percent. However, the outlook for 2024 remains restrained. rtr/ck
Russia overtook Saudi Arabia as China’s main crude oil supplier in 2023. According to Chinese customs data, Moscow delivered a record 107.02 million tons of crude oil to China last year, equivalent to 2.14 million barrels per day (bpd). This was far more than other major oil exporters such as Saudi Arabia and Iraq. In contrast, China’s imports from Saudi Arabia, previously its top supplier, decreased by 1.8 percent to 85.96 million tonnes.
The People’s Republic is taking advantage of the low prices of Russian crude oil, which Moscow is forced to accept due to the sanctions and import bans imposed by previous customers. To avoid violating Western sanctions, Chinese refineries are using middlemen to transport and insure Russian crude oil. According to reports from oil traders, Russia has been operating an entire fleet of so-called shadow tankers since 2022, which usually transport oil under the radar without insurance cover. It is often transferred from ship to ship at sea to hide its origin.
Since the beginning of the Ukraine war, Chinese oil companies have been tight-lipped about the sources of their imports. However, Russia’s Deputy Prime Minister Alexander Novak emphasized in late December that practically all of Russia’s crude oil exports went to China and India in 2023. The West has yet to find a solution. However, Bloomberg reports that there have recently been initial signs that the Russian shadow fleet is facing problems due to the tightening of US sanctions. For example, 14 tankers transporting Russian crude oil to India have either stopped on the spot, turned around or switched off their digital tracking devices. While this could also affect shipments to China, it has so far only been an observation.
Other sanctioned countries also use ship-to-ship transfers for crude oil. According to Reuters, buyers are using the waters off Malaysia as a transshipment point for cargo from Iran and Venezuela. China’s imports, labeled as originating from Malaysia, increased by 53.7 percent in 2023.
Overall, China’s crude oil imports rose to a record 563.99 million tons in 2023, equivalent to 11.28 million bpd. Shipments from the US to China also rose by 81.1 percent despite geopolitical tensions between Beijing and Washington, as the US increased its crude oil production. rtr/ck
The first EU trilogue for the regulation banning the import of products from forced labor planned for last Saturday has been canceled due to disagreement in the EU Council. At its meeting on Friday, the Permanent Representatives Committee (Coreper) made progress in talks on the Council’s position, but was unable to agree on a final text, a spokesperson told Table.Media. In the trilogue, representatives from the Commission, Council and Parliament negotiate important EU rules.
Work will now continue at a technical level in the coming week; Coreper will meet again on Wednesday or Friday. This means that time is running out for negotiations with the EU Parliament. The Council and Parliament would have to reach an agreement at a single meeting by 6 February at the latest. The EU ban on products made using forced labor is primarily aimed at products from China, where Uyghurs in Xinjiang are believed to be forced to work. leo
After an eight-year hiatus, the USA and China have resumed their bilateral agricultural dialogue in the China-US Joint Committee on Cooperation in Agriculture (JCCA). According to the business magazine Caixin, the two agriculture ministers, Tang Renjian and Tom Vilsack, met in Washington. The Chinese Ministry of Agriculture announced that it would maintain the dialogue and “ensure the stable operation of this mechanism.” The two sides held “in-depth and open” talks on green agriculture, food security and trade facilitation.
Caixin reports that Vilsack called China an “important agricultural export market” in a statement from his ministry and emphasized the willingness for more cooperation. The revival of this communication channel, which had been on hold since November 2015, is a further sign that the two superpowers want to talk to each other again instead of just about each other, despite geopolitical tensions. ck
China has issued the first series of licenses for the production and sale of genetically modified maize and soybean varieties. The Ministry of Agriculture has thus paved the way for the commercialization of these crops, the business magazine Caixin reported on Friday. In total, licenses have now been granted for the production of seeds for 36 genetically modified maize and ten genetically modified soya varieties. According to Caixin, the licenses went to three companies in particular: The state-owned China National Seed Group, the agricultural subsidiaries of Beijing Dabeinong Technology, and Yuan Longping High-Tech Agriculture.
The report states that planting will be supervised by the state and limited to certain areas. The licenses will initially be valid until 24 December 2028 in 13 regions at the provincial level – including Beijing and important grain-producing provinces such as Hebei, Liaoning, Jilin and Inner Mongolia.
China has been running pilot projects for the cultivation of genetically modified maize and soybean varieties since 2021. Beijing aims to use genetic engineering to increase yields, focusing on domestic production and food security. However, the country has not yet approved any genetically modified plants for the market. The German Bayer Group also hopes for approval. With the acquisition of the US agricultural giant Monsanto, Bayer has become one of the largest suppliers of green genetic engineering. ck
Uwe Kraeuter is the “Marco Polo of our time,” one friend said. He has lived in China for almost 50 years, since 1974, when he was awarded the title of “Foreign Expert” towards the end of the infamous Cultural Revolution and two years before Mao Zedong’s death. He is also known as the German who has lived in China the longest.
The reason why Uwe Kraeuter came to China is quite unusual. He had taken part in a violent protest against the Vietnam War in Heidelberg in 1970 and was sentenced to eight months in prison without parole for alleged ringleadership. However, he did not serve his sentence – instead, he accepted a job offer as a translator at the publishing house for foreign-language literature of the Communist leadership in China and went to Beijing. This put him out of reach of the German justice system.
“I am grateful that I had the courage and energy at the time to simply say that if China invites me and opens its doors, I will go there. What’s more, the exoticism appealed to me,” says Kraeuter today. He must have got his adventurous spirit from his grandfather, who had been to China as a sailor: “When I was a child, he told me a lot about his impressions there, and they were all wonderful stories.”
Kraeuter discovered his interest in Chinese art and film after the end of the Cultural Revolution in 1976. “All these Chinese artists came back from prisons or rural areas, from far away to the big cities where they originally came from.” Kraeuter had the opportunity to meet many of these people who had experienced incredible things.
In 1985, he shot the documentary “Meine Pekinger Kuenstlerfreunde” (My Beijing Artist Friends) in cooperation with the Youth Film Studio of the Beijing Film Academy. One of the people portrayed was the recently deceased painter Huang Yongyu, who gained fame at the beginning of the Cultural Revolution for his painting of an owl with one eye closed. “The Gang of Four claimed that one eye was closed for the revolution and Mao Zedong’s thought – what nonsense!”
Through his work – not only as an author, but also as a film producer and entrepreneur – Uwe Kraeuter has established himself as a cultural mediator between China and Germany over the years. In 1980, he organized the staging of the Chinese drama “The Teahouse” by Lao She with the Mannheim National Theatre. “All the media in Germany were fascinated by the performances,” he recalls. There was not a single negative article.
Before and after founding his own company called “Asia World Network Ltd,” Kraeuter produced films in and about China for the German public broadcaster ZDF. At the same time, he arranged the import of German films and TV shows.
Due to the harsh US criticism of the brutal suppression of the democracy movement in Tiananmen Square on June 4, 1989, Jiang Zemin, a leading politician at the time, ordered the US series Hunter, which had been broadcast on Shanghai television up to that point, to be canceled. Instead, the station included the German TV series Derrick, which solves its cases with brains instead of weapons. The hope was that its protagonist’s peaceful way of dealing with conflict situations would positively impact people’s minds.
In 1991, he visited the Ai Dao Tang temple in Chengdu for the production of “Prinzessin einer anderen Welt” (Princess of Another World) about the life of Buddhist nuns in China. He was also profoundly impressed by his stay in the Taklamakan Desert in Xinjiang, where Uyghur children told him their stories. This is how the series “Wuestenkinder” (Desert Children) came to be.
What does a life that takes place in China for so long look like? It is a biography shaped by a willingness to embrace new circumstances. In 2012, he published his book “So ist die Revolution, mein Freund,” in which Uwe Kraeuter describes his experiences in China. He made friends from all walks of life and professions.
Besides friendships such as those with the artists, love also shaped Kraeuter’s relationship with the country. In 1984, he married Shen Danping, who was a famous actress in China for many years and remains renowned to many. The official Chinese side initially disapproved of this relationship. “The skepticism towards foreign-Chinese marriages is now a thing of the past,” says Kraeuter. They frequently appear together on talk shows and Shanghai Television even named them the most humorous couple in 2005.
Kraeuter would like the West to adopt a more open-minded attitude and be more polite. “We feel the need to be aware of the differences in the minds of our world and the world there, in other words, our historical differences,” he says. If this does not happen, there can be no true communication. His motto is that people should ask more questions instead of pointing the finger.
Kraeuter is now 78 years old. He recently published a new book. It’s called “Reisen ins Unbekannte” (Journeys into the unknown). In it, he writes about his experiences in North Korea. Juliane Scholuebbers
Karolin Kollmorgen has been responsible for the China Hub project at the Bavarian University Center for China (BayCHINA) since December. China Hub is a project funded by the German Federal Ministry of Education and Research aimed at promoting China expertise in the Bavarian higher education and science landscape. Kollmorgen was previously a cultural manager at the Confucius Institute in Hamburg.
Ali Wyne has been Senior Research and Advocacy Advisor US-China at the International Crisis Group since this month. The Brussels-based non-governmental organization provides analyses and proposals for resolving international conflicts.
Is something changing in your organization? Let us know at heads@table.media!
Tesla boss Elon Musk wants to send his Cybertruck on a promotional tour to China. Even in the People’s Republic, Tesla’s second-largest market, the edgy vehicle is being met with hate and love and hardly anything in between. Online, many associate the car with China’s “useless Edison” Geng Shuai 耿帥, a welder from the hinterland who keeps going viral with videos of strange inventions.
However, market approval for Tesla’s Cybertruck is not likely in China anyway. Unlike in the US, pickups are a niche product here, as many city councils, including that of Beijing, do not allow them in city centers.
Europe is currently debating about Chinese electric cars. Are we facing an import tsunami? Do we have to defend ourselves – and if so, with what? The EU has launched an anti-subsidy investigation, which could ultimately result in punitive tariffs. Chinese manufacturers are not pleased. But they want to tap into the European market regardless.
Chery is one such brand targeting an EU market launch in 2024. The company plans to start in Spain, with Germany following in the third quarter, explains Vice President of Chery International Charlie Zhang in an interview with Julia Fiedler. Chery wants to offer not only EVs but also combustion engines and plug-in hybrids. Zhang also expressed his surprise at how poorly developed Germany’s electric charging infrastructure is.
The number of cancer cases in China is rising disproportionately compared to the West. The number of deaths, in particular, is above average. Joern Petring explains that this negative development has unleashed new forces. China has triggered a faster development of new drugs and diagnostic procedures from which the West could benefit. One of the new drugs from the People’s Republic has already been approved in the United States. Other regions and other drugs are likely to follow.
According to Chery’s own figures, exports in 2023 stood at around 700,000 cars. How many countries are you currently exporting vehicles to?
We are currently active in over 80 countries and regions. However, we will be even bigger in 2024 because we plan to expand into Europe and Germany in particular. We are taking this step by step. First, we are launching our brand in Spain, followed by Italy and the United Kingdom. We will probably not enter the German market until the third quarter of 2024.
Why so late? Chery has been operating a development center in Germany since 2018, but their cars are not yet on the German market. They were supposed to be launched in the spring…
We want to make sure that we are well prepared. Four key factors are crucial: our products, the dealership network, marketing and branding, as well as service and the availability of spare parts. All of this needs to be in place before we launch our brands.
Do you already have contracts with German dealerships?
We are currently in very close talks with a number of potential or future major distributor groups.
But you haven’t signed any contracts yet?
Not yet. But it will very likely happen soon.
What kind of cars will you be launching on the German market?
We want to offer a range of electric cars. However, we are also aware that vehicles with combustion engines still account for a large proportion of total sales in Germany. That’s why we want to offer a comprehensive solution: Internal combustion engines, battery electric vehicles and plug-in hybrids.
Chinese EVs have been garnering a lot of attention recently and interest is high. Don’t you think you’ll dilute your portfolio if you also offer combustion engines?
We thought about this question a lot. Several other Chinese brands, such as BYD and Nio, only offer EVs. However, we aim to be big. In China, Chinese OEMs (car manufacturers) now have an overall market share of more than 50 percent. When it comes to electric cars, the share of Chinese brands is even over 80 percent. Chinese manufacturers are becoming more and more competitive. They are launching many EVs on the market – not just EVs, but also internal combustion vehicles. We cannot neglect this significant market segment.
Do German manufacturers have to fear that Chinese EVs will flood the market like a tsunami?
I don’t think that’s an appropriate description for the nature of the competition. For decades, German brands such as BMW, Mercedes, Audi and Porsche have dominated the premium brand sector. German brands, including Volkswagen China, have sold millions of cars every year. But right now, Chinese carmakers are getting bigger and stronger. We need a level playing field. Germany is a developed nation that does a lot of business in China. Now, the Chinese manufacturers are offering their German customers good cars. I don’t think it’s a tsunami; German carmakers are still leading in many aspects.
However, the qualities German car manufacturers have always been known for may no longer be as important in the future when cars become smartphones on wheels. How do you see the German car industry?
Let me put it this way: There is a conventional “old strand”, it stands for the combustion engines, the last century. German car manufacturers are pretty good here. When it came to engines and transmissions, it was difficult to catch up. Then there is the new strand, represented by battery-electric vehicles. Batteries, electric motors, electric controls, intelligent cockpits, autonomous driving, all these technologies. The Chinese manufacturers have recognized an opportunity here and have tried to be strong in this respect.
What are the impacts of China’s use of new technologies?
If you look at the gap between Chinese and German manufacturers, it has definitely narrowed. But when it comes to the fundamentals of car manufacturing, durability, reliability and quality, German manufacturers are still leading by a wide margin.
What does that mean?
There are still a lot of things we have to learn. Volkswagen has been our teacher for many, many decades. Our CEO used to work for Volkswagen. He always tells us that we must learn from German quality and how they manufacture cars.
Nevertheless, the boardrooms in Wolfsburg and Stuttgart are shaking.
This is a challenging moment for German car manufacturers. It’s hard to imagine when you’ve been a leader for many years, but now a new era is dawning. The era of smartphones on wheels. It is different. The way we compete and the way they build and develop their products is changing – and, of course, that means a certain challenge. But I still believe that the two sides can complement each other perfectly. Why shouldn’t we build highly complementary partnerships?
Don’t you think a certain degree of industrial independence is important for both countries?
If you look at our factory, you will discover many devices and machines manufactured in Germany, Italy and Japan. We buy and use many German machines and equipment. Of course, development requires a rethink. In the past, China exported toys, clothing and, above all, cheap products. And suddenly China is not only offering toys, but also cars. I think we have to adapt to this new reality, this new normality.
You are not only responsible for Europe, but also for other parts of the world. I have heard that you are particularly successful in Mexico.
We have established subsidiaries in various countries. In 2022, we launched our brands in Mexico. We currently sell around 4,000 to 5,000 vehicles there every month.
The US government is not thrilled with your activities in Mexico. The US has high tariffs on EVs manufactured in China. The government fears that you could now import your vehicles into the United States through the back door by producing them in Mexico. What is your stance on this?
The United States-Mexico-Canada Agreement (USMCA), the successor to NAFTA, has been in force in North America since 2020. The regulations regarding localization are stricter. The United States wanted to set higher standards for local production in Mexico. The Mexican market is currently big enough for us – it is a large market of more than 1.2 million vehicles. On the other hand, Mexico also has a number of free trade agreements with other countries in South America and even Europe. In the medium term, we can produce in Mexico and export to other countries.
So also in the US?
We hope that we can use the free trade agreements to manufacture in Mexico and export to the United States, especially electric cars. But that is not our immediate goal.
The EU has also started looking into anti-dumping duties on Chinese EVs. The issue is allegedly irregular subsidies from the Chinese leadership. What does this mean for you?
I think it is a regrettable decision that the EU has launched an anti-subsidy investigation to regulate Chinese cars. This will definitely have a negative impact on the sales of Chinese EVs. We can’t change that; we have to adapt to it.
The German government, in turn, unexpectedly discontinued subsidies for electric cars at the end of last year. How has this affected your company?
That is why we will also offer cars with combustion engines. We can’t just focus on the EV market. At just under 20 percent of new registrations in 2023, it is still relatively small. We want to introduce a robust product portfolio that includes combustion engines, plug-in hybrids and electric vehicles because we want to target the mass market. If you look at Europe as a whole, the individual markets are also very different.
Did you expect Germany’s electric market to develop faster?
Everyone thought that Germany, the largest economy with the largest market in Europe, would promote electrification and try to achieve zero emissions. But now, the German government has even canceled subsidies for electric cars. I believe electromobility has three key factors: affordability, battery range and infrastructure. If these three key factors are not in place, it will be very difficult to achieve 100 percent electrification. I have been traveling around Frankfurt, Munich, and Cologne, looking for charging stations on the streets. To be honest, it was very difficult to find many. I don’t know how the government plans to promote the infrastructure nationwide or in Europe. But if the infrastructure is missing, how can you talk about only allowing zero-emission cars by 2035?
Charlie Zhang (张升山) is Executive Vice President of Chery International and Assistant President of the Chery Automobile Group. He previously held the position of General Manager of the Central and South America region. Zhang has worked for the Chinese car manufacturer for more than 15 years.
China has a cancer problem. According to a new study by the state-run Chinese Center for Disease Control and Prevention (CDC), the number of cancer deaths in China has increased by 21.6 percent to almost 2.4 million each year between 2005 and 2020. Cancer has been the most common cause of death in the People’s Republic since 2010.
Along with the rising number of deaths, these are the most important findings of the study published in December 2023:
China has long had the highest number of cancer deaths in the world. However, the CDC researchers warn that the country’s mortality rates may even be underestimated due to the limited data available. They urge the Chinese government to make every effort to reduce the burden of cancer. This includes the funding of cost-effective cancer screening and vaccination programs as well as the implementation of a strict tobacco control policy.
Beijing is not idle. Public health policymakers have set themselves the goal of increasing the overall survival rate of cancer patients by ten percent by 2025. The aim is to reduce premature mortality due to non-communicable diseases, including cancer, by 30 percent by 2030.
Scientific breakthroughs, however, give reason to hope that China will not only be able to get its own problems under control in the medium term, but also contribute to solving the global cancer problem.
Chinese companies have made progress in the development of new drugs. Some of them are now also being used in the West; for example, the approval of the drug Toripalimab in the United States recently caused a stir. The US Food and Drug Administration (FDA) approved the drug developed by Shanghai Junshi Biosciences for the treatment of nasopharyngeal carcinoma (NPC) in October. NPC is an aggressive type of cancer that starts behind the nose in the upper part of the throat. Toripalimab is the first and currently only FDA-approved drug for the treatment of this type of cancer.
A few weeks ago, Dizal, a biopharmaceutical company from Jiangsu Province, also presented a new, promising drug. Sunvozertinib has shown good results in the treatment of a certain type of lung cancer. In a phase 2 trial involving 104 patients in advanced stages of the disease, sunvozertinib showed significantly higher effectiveness than all previous candidates.
There are numerous similar reports on promising drugs from China. Researchers there have also made progress in developing and applying AI-based image recognition systems used in oncology. These, too, will find their way to the West. The DAMO Academy, a research institute of the Alibaba Group, has recently presented a new AI-supported tool that can recognize early signs of pancreatic cancer. Using CT scans, the new tool called PANDA can identify whether a patient has the disease even more accurately than radiologists.
The State Council has instructed highly indebted local governments and state banks in twelve Chinese regions to postpone or cancel some state-funded infrastructure projects. This was reported by Reuters, citing insiders. The directive concerns projects where less than half of the planned investments have been completed – including motorways, the construction and expansion of airports and local transport projects.
Some projects are exempt, for instance, projects approved by the central government in Beijing or the construction of affordable housing. The State Council has not yet made the directive public.
Over the past few months, China has been trying to get a grip on its municipal debt, which has now reached the equivalent of around 11.94 trillion euros. According to the latest available data, it corresponded to 76 percent of gross domestic product in 2022. In 2019, it was only 62 percent.
According to Reuters, Beijing had already targeted the twelve regions in the fall of 2023. At that time, the State Council had already instructed local governments to stop “problematic” public-private partnership projects and imposed investment restrictions. The twelve regions in question include the provinces of Liaoning and Jilin in the northeast, Guizhou and Yunnan in the southwest, and Tianjin and Chongqing. These regions have been instructed to make every effort to reduce their “debt risk to a low and medium level,” sources told Reuters. However, the directive did not specify how to measure debt reduction.
According to official figures, China’s economy achieved GDP growth of 5.2 percent in 2023, slightly above the official target of around five percent. However, the outlook for 2024 remains restrained. rtr/ck
Russia overtook Saudi Arabia as China’s main crude oil supplier in 2023. According to Chinese customs data, Moscow delivered a record 107.02 million tons of crude oil to China last year, equivalent to 2.14 million barrels per day (bpd). This was far more than other major oil exporters such as Saudi Arabia and Iraq. In contrast, China’s imports from Saudi Arabia, previously its top supplier, decreased by 1.8 percent to 85.96 million tonnes.
The People’s Republic is taking advantage of the low prices of Russian crude oil, which Moscow is forced to accept due to the sanctions and import bans imposed by previous customers. To avoid violating Western sanctions, Chinese refineries are using middlemen to transport and insure Russian crude oil. According to reports from oil traders, Russia has been operating an entire fleet of so-called shadow tankers since 2022, which usually transport oil under the radar without insurance cover. It is often transferred from ship to ship at sea to hide its origin.
Since the beginning of the Ukraine war, Chinese oil companies have been tight-lipped about the sources of their imports. However, Russia’s Deputy Prime Minister Alexander Novak emphasized in late December that practically all of Russia’s crude oil exports went to China and India in 2023. The West has yet to find a solution. However, Bloomberg reports that there have recently been initial signs that the Russian shadow fleet is facing problems due to the tightening of US sanctions. For example, 14 tankers transporting Russian crude oil to India have either stopped on the spot, turned around or switched off their digital tracking devices. While this could also affect shipments to China, it has so far only been an observation.
Other sanctioned countries also use ship-to-ship transfers for crude oil. According to Reuters, buyers are using the waters off Malaysia as a transshipment point for cargo from Iran and Venezuela. China’s imports, labeled as originating from Malaysia, increased by 53.7 percent in 2023.
Overall, China’s crude oil imports rose to a record 563.99 million tons in 2023, equivalent to 11.28 million bpd. Shipments from the US to China also rose by 81.1 percent despite geopolitical tensions between Beijing and Washington, as the US increased its crude oil production. rtr/ck
The first EU trilogue for the regulation banning the import of products from forced labor planned for last Saturday has been canceled due to disagreement in the EU Council. At its meeting on Friday, the Permanent Representatives Committee (Coreper) made progress in talks on the Council’s position, but was unable to agree on a final text, a spokesperson told Table.Media. In the trilogue, representatives from the Commission, Council and Parliament negotiate important EU rules.
Work will now continue at a technical level in the coming week; Coreper will meet again on Wednesday or Friday. This means that time is running out for negotiations with the EU Parliament. The Council and Parliament would have to reach an agreement at a single meeting by 6 February at the latest. The EU ban on products made using forced labor is primarily aimed at products from China, where Uyghurs in Xinjiang are believed to be forced to work. leo
After an eight-year hiatus, the USA and China have resumed their bilateral agricultural dialogue in the China-US Joint Committee on Cooperation in Agriculture (JCCA). According to the business magazine Caixin, the two agriculture ministers, Tang Renjian and Tom Vilsack, met in Washington. The Chinese Ministry of Agriculture announced that it would maintain the dialogue and “ensure the stable operation of this mechanism.” The two sides held “in-depth and open” talks on green agriculture, food security and trade facilitation.
Caixin reports that Vilsack called China an “important agricultural export market” in a statement from his ministry and emphasized the willingness for more cooperation. The revival of this communication channel, which had been on hold since November 2015, is a further sign that the two superpowers want to talk to each other again instead of just about each other, despite geopolitical tensions. ck
China has issued the first series of licenses for the production and sale of genetically modified maize and soybean varieties. The Ministry of Agriculture has thus paved the way for the commercialization of these crops, the business magazine Caixin reported on Friday. In total, licenses have now been granted for the production of seeds for 36 genetically modified maize and ten genetically modified soya varieties. According to Caixin, the licenses went to three companies in particular: The state-owned China National Seed Group, the agricultural subsidiaries of Beijing Dabeinong Technology, and Yuan Longping High-Tech Agriculture.
The report states that planting will be supervised by the state and limited to certain areas. The licenses will initially be valid until 24 December 2028 in 13 regions at the provincial level – including Beijing and important grain-producing provinces such as Hebei, Liaoning, Jilin and Inner Mongolia.
China has been running pilot projects for the cultivation of genetically modified maize and soybean varieties since 2021. Beijing aims to use genetic engineering to increase yields, focusing on domestic production and food security. However, the country has not yet approved any genetically modified plants for the market. The German Bayer Group also hopes for approval. With the acquisition of the US agricultural giant Monsanto, Bayer has become one of the largest suppliers of green genetic engineering. ck
Uwe Kraeuter is the “Marco Polo of our time,” one friend said. He has lived in China for almost 50 years, since 1974, when he was awarded the title of “Foreign Expert” towards the end of the infamous Cultural Revolution and two years before Mao Zedong’s death. He is also known as the German who has lived in China the longest.
The reason why Uwe Kraeuter came to China is quite unusual. He had taken part in a violent protest against the Vietnam War in Heidelberg in 1970 and was sentenced to eight months in prison without parole for alleged ringleadership. However, he did not serve his sentence – instead, he accepted a job offer as a translator at the publishing house for foreign-language literature of the Communist leadership in China and went to Beijing. This put him out of reach of the German justice system.
“I am grateful that I had the courage and energy at the time to simply say that if China invites me and opens its doors, I will go there. What’s more, the exoticism appealed to me,” says Kraeuter today. He must have got his adventurous spirit from his grandfather, who had been to China as a sailor: “When I was a child, he told me a lot about his impressions there, and they were all wonderful stories.”
Kraeuter discovered his interest in Chinese art and film after the end of the Cultural Revolution in 1976. “All these Chinese artists came back from prisons or rural areas, from far away to the big cities where they originally came from.” Kraeuter had the opportunity to meet many of these people who had experienced incredible things.
In 1985, he shot the documentary “Meine Pekinger Kuenstlerfreunde” (My Beijing Artist Friends) in cooperation with the Youth Film Studio of the Beijing Film Academy. One of the people portrayed was the recently deceased painter Huang Yongyu, who gained fame at the beginning of the Cultural Revolution for his painting of an owl with one eye closed. “The Gang of Four claimed that one eye was closed for the revolution and Mao Zedong’s thought – what nonsense!”
Through his work – not only as an author, but also as a film producer and entrepreneur – Uwe Kraeuter has established himself as a cultural mediator between China and Germany over the years. In 1980, he organized the staging of the Chinese drama “The Teahouse” by Lao She with the Mannheim National Theatre. “All the media in Germany were fascinated by the performances,” he recalls. There was not a single negative article.
Before and after founding his own company called “Asia World Network Ltd,” Kraeuter produced films in and about China for the German public broadcaster ZDF. At the same time, he arranged the import of German films and TV shows.
Due to the harsh US criticism of the brutal suppression of the democracy movement in Tiananmen Square on June 4, 1989, Jiang Zemin, a leading politician at the time, ordered the US series Hunter, which had been broadcast on Shanghai television up to that point, to be canceled. Instead, the station included the German TV series Derrick, which solves its cases with brains instead of weapons. The hope was that its protagonist’s peaceful way of dealing with conflict situations would positively impact people’s minds.
In 1991, he visited the Ai Dao Tang temple in Chengdu for the production of “Prinzessin einer anderen Welt” (Princess of Another World) about the life of Buddhist nuns in China. He was also profoundly impressed by his stay in the Taklamakan Desert in Xinjiang, where Uyghur children told him their stories. This is how the series “Wuestenkinder” (Desert Children) came to be.
What does a life that takes place in China for so long look like? It is a biography shaped by a willingness to embrace new circumstances. In 2012, he published his book “So ist die Revolution, mein Freund,” in which Uwe Kraeuter describes his experiences in China. He made friends from all walks of life and professions.
Besides friendships such as those with the artists, love also shaped Kraeuter’s relationship with the country. In 1984, he married Shen Danping, who was a famous actress in China for many years and remains renowned to many. The official Chinese side initially disapproved of this relationship. “The skepticism towards foreign-Chinese marriages is now a thing of the past,” says Kraeuter. They frequently appear together on talk shows and Shanghai Television even named them the most humorous couple in 2005.
Kraeuter would like the West to adopt a more open-minded attitude and be more polite. “We feel the need to be aware of the differences in the minds of our world and the world there, in other words, our historical differences,” he says. If this does not happen, there can be no true communication. His motto is that people should ask more questions instead of pointing the finger.
Kraeuter is now 78 years old. He recently published a new book. It’s called “Reisen ins Unbekannte” (Journeys into the unknown). In it, he writes about his experiences in North Korea. Juliane Scholuebbers
Karolin Kollmorgen has been responsible for the China Hub project at the Bavarian University Center for China (BayCHINA) since December. China Hub is a project funded by the German Federal Ministry of Education and Research aimed at promoting China expertise in the Bavarian higher education and science landscape. Kollmorgen was previously a cultural manager at the Confucius Institute in Hamburg.
Ali Wyne has been Senior Research and Advocacy Advisor US-China at the International Crisis Group since this month. The Brussels-based non-governmental organization provides analyses and proposals for resolving international conflicts.
Is something changing in your organization? Let us know at heads@table.media!
Tesla boss Elon Musk wants to send his Cybertruck on a promotional tour to China. Even in the People’s Republic, Tesla’s second-largest market, the edgy vehicle is being met with hate and love and hardly anything in between. Online, many associate the car with China’s “useless Edison” Geng Shuai 耿帥, a welder from the hinterland who keeps going viral with videos of strange inventions.
However, market approval for Tesla’s Cybertruck is not likely in China anyway. Unlike in the US, pickups are a niche product here, as many city councils, including that of Beijing, do not allow them in city centers.