China’s flagship space project SpaceSail is on course for success. 18 satellites were successfully launched into Earth orbit from the rocket launch center in Taiyuan on Thursday. A race for the best satellite network has begun up there. SpaceSail plans to install at least 10,000 satellites by 2030 in order to compete with Elon Musk’s Starlink. This is clearly also in the interests of the Chinese government, which wants to make China a “space superpower” by 2045.
However, there is still a long way to go, writes Leonardo Pape. The company has just 72 satellites in orbit – compared to Elon Musk’s 7,000 – but SpaceSail is rapidly catching up and is already offering its services in countries such as Brazil and Pakistan. There is no time to lose. After all, the war in Ukraine has shown how strategically important such networks can be for communication in an emergency.
Chinese workers and employees also go a long way when they want to improve workers’ rights in the country. Marcel Grzanna introduces the former train driver Li Weijie and his fight for the guild. Li’s story is a good example of how state trade unions in China serve the interests of the Communist Party rather than the workers themselves.
Against the backdrop of possible investments by Chinese manufacturers in Volkswagen factories in Germany, the way Chinese companies treat their workers in this country is likely to soon attract greater interest.
Li Weijie 李伟杰 can only shake his head at the good reputation of Chinese employers in Germany. While Chinese investors in this country are said to accept the rights of employees without resistance, Li has had very different experiences with state-owned companies in the People’s Republic.
More than a decade ago, Li unsuccessfully sued his employer for 920,000 yuan (the equivalent of around EUR 123,000 today) in compensation for overtime work and medical treatment. The 55-year-old was an engine driver at the Luoyang locomotive depot in Zhejiang province. He tried dozens of times to enforce his claim through the courts. But he cut his teeth on the Chinese justice system.
Today, Li is an undesirable person at the locomotive depot. His employment contract has long since been terminated. He lives in a dormitory in Luoyang and receives a monthly pension of 380 yuan (EUR 50). “This is completely unreasonable,” he complains in a video interview with Table.Briefings. He accuses the company of disregarding employees’ rights and ignoring communist values. He says he left the Communist Party years ago, disillusioned by this.
Li could not count on the support of a trade union. In China, the All-China Federation of Trade Unions (ACFTU) unites all trade unions in the country and is closely linked to the Communist Party. “The ACFTU essentially functions as an administrative arm of the party-state, which uses it as an instrument to harmonize the interests of the workers with those of the government,” summarizes Liu Mingwei, associate professor at Rutgers University in New Jersey, in his research. Trade unions are expected to promote harmony in labor relations. However, they “often face challenges in effectively representing the interests of workers”.
Li Weijie has therefore been campaigning single-handedly for years to improve working conditions for employees of state-owned railroad companies. He organizes protests, supports ex-colleagues in their lawsuits, and strives to make the Chinese public aware of the contradictions between the importance of workers in the country as propagated by the state and their treatment by state-owned companies.
However, Chinese media do not report on his involvement, nor do the security authorities allow him to make public appearances or organize his guild via social media. A chat group he set up once brought together 2,000 train drivers before it was shut down by censors. The group had once chosen June 16 as World Railway Day and even developed contacts in Japan, as Li recounts. But the more railroad employees joined, the more harshly the state reacted.
Last year, Li says, he was abducted by officials on the day before June 16 and held for two days in a remote forest without mobile phone reception – without a judicial basis, without any chance of such an abduction being punished under the rule of law. He was banned from traveling abroad. When he wanted to travel to the USA last year to meet railroad unionists there, officials at Shanghai airport prevented him from boarding the plane, he says.
“The government fears that I could organize a strike that would spread on a large scale,” Li believes. The company’s provincial office has therefore already made concessions and pays an additional 100 million yuan a year to the train drivers. Still far too little and limited to the province of Zhejiang, Li complains. Overtime is still not adequately paid, not enough breaks are granted and health care is not guaranteed.
Ever since production workers in a number of factories in Guangdong province went on strike in 2010, strikes have been a tried and tested means for employees in China to stand up for their rights. At that time, it was a Honda factory in Nanhai that led to work stoppages throughout the province – the joint ventures of German car manufacturers were also affected.
The strikes had consequences. The state obliged companies to pay minimum wages throughout the country and has since tightened its labor protection laws several times. Guangdong province even introduced the right to collective bargaining in 2014. However, implementation is still lagging behind. “Many companies have never complied, especially not the large state-owned enterprises,” says Boy Lüthje from the Institute for Social Research in Frankfurt am Main, who spent many years researching industrial relations in China at Sun Yat-Sen University and the South China University of Technology in Guangdong.
In fact, the workers there have the right to form a kind of company union and to present their demands to the management as a united front via elected employee representatives. Lüthje estimates that “perhaps 20 to 30 percent of companies in Guangdong” actually grant workers this right. Outside Guangdong, the figures are significantly lower. “Founding an industrial union would be the next step in China. But in terms of party politics, the legal framework has never been promoted further,” says Lüthje.
Strikes are still regarded as a tried and tested means for workers – especially in Guangdong. However, these are one-point movements, not coordinated actions that unite workers from the grassroots. “Because from a party perspective, this must not happen. Labor disputes are much more fragmented today,” says Lüthje.
The future of Chinese employers in Germany will probably only become clear when Chinese investors start investing in industrial sites on a large scale. The discussed interest from China in the Volkswagen plants in Osnabrück and Dresden could also develop into a litmus test for industrial relations between German employees and Chinese management.
So far, the construct has worked well. The study “Chinese investment in the Ruhr region” quotes an employee of ThyssenKrupp Tailored Blanks: “If I had the choice between Chinese and Americans, I’d prefer Chinese.” Americans do not care much about workers’ rights, “Chinese accept them”.
China’s flagship space project SpaceSail recently announced two new successes within the space of a few hours: 18 more of its satellites were launched into orbit last Thursday from the rocket launch center in Taiyuan in northern China. In addition, SpaceSail’s international offshoot expanded with a new branch in Kazakhstan.
The company behind SpaceSail is Shanghai Spacecom Satellite Technology (SSST), which is mainly funded by the Shanghai municipal government and the Chinese Academy of Sciences. The aim is to create a so-called mega-constellation, a dense satellite network in low earth orbit that can ensure internet coverage even in remote parts of the world. SpaceSail plans to install at least 10,000 satellites by the end of 2030 – and thus compete with Elon Musk’s Starlink
A few years ago, the Chinese government announced its goal of becoming a “space superpower” by 2045. On the way there, its own satellite mega-constellation is “a strategically important piece of space architecture”, says Blaine Curcio, analyst and publisher of the China Space Monitor, in an interview with Table.Briefings. The strategic importance of such systems can be seen, among other things, in Russia’s war against Ukraine. Ukraine is using Starlink to replace communication networks destroyed in the war, while Russia is presumably using the system illegally.
The devastating effects of dependence on foreign satellite infrastructure in the event of a crisis were painfully demonstrated to China decades ago: In the course of a confrontation in the Taiwan Strait in 1996, the People’s Liberation Army lost track of two of its three missiles fired in the strait – probably because the US had interrupted the GPS signal in the Pacific. As a result, China developed its own BeiDou navigation and positioning system. To this day, it is considered the largest Chinese investment in aerospace technology in history.
A powerful satellite mega-constellation would be a similarly big success for China. So far, however, SpaceX is far and away ahead. Elon Musk’s company already has around 7,000 satellites orbiting the Earth, around two-thirds of all active satellites. SpaceSail has just 72, but the project only launched its first satellites into orbit in August last year and has rapidly gained momentum since then.
According to analyst Curcio, SpaceSail is “undoubtedly the leader” within China. Among other things, SpaceSail has left its Chinese rival network GuoWang from the China SatNet Group behind – even though the latter was chosen by the central government a few years ago as an officially supported Starlink alternative. In a financing round in February 2024, SpaceSail raised around 6.7 billion yuan (just under EUR 900 million) in investor funds, more than any other space company in China. Curcio believes that around 300 more SpaceSail satellite launches are realistic for the current year, with even more possible in the following years.
Even though there is still a long way to go to achieve a powerful mega constellation, SSST is already trying to secure access to potential target markets. Last year, for example, the company signed an agreement with the Brazilian state telecommunications group Telebras to secure internet connections in remote areas by 2026. This puts SpaceSail in direct competition with Starlink, which currently has the largest market share in Brazil. SpaceSail has also expressed interest in entering the market in Pakistan.
SpaceSail presents itself as a commercial project, but the relationship with the Chinese government is obvious. The agreement in Brazil was a direct part of bilateral negotiations during Xi’s state visit in November. The proximity to the state serves as a door opener for friendly countries, but could also cause problems for the company. Curcio assumes that many Western countries will refuse to allow SpaceSail to enter the market.
In Germany, the parent company SSST has already had unpleasant experiences in this regard: A few years ago, the company entered the satellite business in Germany in a joint venture with Kleo Connect GmbH. SSST even became the majority shareholder, along with other Chinese investors.
Later, the investors from China insisted that satellite production for the joint venture should largely be located at the Shanghai-based company SECM. According to reports in the Financial Times, the fact that SECM also works for the Chinese military caused unease on the German side. The joint venture partners fell out. In the end, the German government prohibited a complete takeover by SSST as part of an investment review in 2023. The Shanghai-based company withdrew – and now prefers to make a new attempt on the domestic market.
In order to better enforce rights against trading platforms and traders from the EU and third countries in the future, the Federal Ministry for Economic Affairs has adopted an action plan for the e-commerce segment. The e-commerce action plan presented to the cabinet on Wednesday is intended to set an example “for fair competition and the protection of consumers from unsafe and dangerous products in online trade”, said Federal Minister for Economic Affairs Robert Habeck.
The high European standards must apply to everyone. “No one should gain an advantage by disregarding applicable law,” said Habeck. The online industry in Germany and the EU accuses providers from China in particular, such as Temu, Shein, and AliExpress, of not complying with European standards and distorting competition.
The German E-Commerce and Distance Selling Trade Association (BEVH) welcomed the government’s action and expressed confidence that there would now be better control of imports from third countries by providers such as Temu, “who damage fair competition in Europe with questionable business practices”.
According to estimates by the EU Commission, a total of four billion parcels entered the EU via global e-commerce platforms last year, as the Ministry of Economic Affairs explained. The customs and market surveillance authorities found “that many of the products do not comply with existing regulations on product safety, consumer protection, environmental and health standards, intellectual property rights, customs, and import regulations”. rtr/niw
DeepSeek is said to have used models from OpenAI to train its own AI. OpenAI told the Financial Times that there was some evidence of “distillation” that could have come from DeepSeek. Distillation is a technique used in the development industry to improve performance on smaller models. The results of larger, more powerful ones are used for this purpose.
Although industry experts say the practice is common in order to save costs, OpenAI considers it a violation of its terms of use. It states that users may not “copy” any of its services or “use results to develop models that compete with OpenAI”.
The criticism that DeepSeek’s models do not respond to terms censored by the Chinese government, such as Tank Man or the 1989 massacre on Tiananmen Square, and clumsily answer “Sorry, that’s beyond my capabilities at the moment”, clearly shows that there are not only gaps in content.
The International Campaign for Tibet (ICT) also warned that the research results of the Chinese AI DeepSeek should be treated “extremely critically”. “DeepSeek clearly wants to manipulate free and fact-based discourse in the public sphere,” said ICT Executive Director Kai Müller. He also warned that there was a great danger that DeepSeek would be used as an instrument of the Chinese Communist Party to spread propaganda. niw
The European Commission would like to give preference to local companies for high-tech contracts in the future. This is the result of its competition compass presented on Wednesday. Specifically, it concerns public procurement of critical technologies, which currently account for 14 percent of Europe’s gross domestic product. The preferential treatment of European companies is intended to stabilize supply chains, secure technology, and simplify the rules for start-ups, according to the document. These measures are also intended to counteract overcapacity and unfair competition.
The South China Morning Post reports that a “Buy European” regulation is unlikely to happen. The move comes just a few weeks after the EU determined that China’s own “Buy Local” regulations in the medical sector are illegal. The procurement agreement of the World Trade Organization (WTO) prohibits discrimination against foreign companies beyond a threshold value. Instead, the EU will create more incentives to invest in European companies in the future.
Even without the “Buy European” regulation, the proposal fits in with the spirit of the times. Both CDU chancellor candidate Friedrich Merz and French Prime Minister François Bayrou have warned of the threat posed by China to the European market. The EU therefore wants to reduce its dependence on Chinese markets. Instead, programs such as the Competitiveness Compass are intended to strengthen production and competition within Europe. ek
China is currently experiencing its Sputnik moment. Just as the Soviet Union surprised the USA with the first satellite in space in the late 1950s, China’s Sputnik is currently appearing for Europe in the form of artificial intelligence and futuristic, battery-powered vehicles. The Chinese AI start-up DeepSeek is showing the American tech champions Google, Apple and Meta that AI “Made in China” is world-class. The young company has developed an open standard relatively cheaply – R1 is said to have cost less than six million euros. At the same time, it is clear that the US sanctions on chip exports have stimulated Chinese innovation rather than hindering the country in the further development of future-proof technology. A wake-up call – also for Europe.
When the Chinese government presented its Made in China 2025 industrial strategy ten years ago, it caused irritation around the world. At that moment at the latest, it was clear that China’s path to becoming an industrial superpower would cause friction and rivalry with the Western, liberal economic system.
A rethink took place in Washington: Instead of “constructive engagement” with China, strategists in the US government and influential think tanks were now suddenly talking about “strategic competition” or “strategic rivalry”. The trade war launched by the Trump administration in 2018 has made innovation even more important.
The aggressive way in which the US has attacked Chinese companies such as Huawei and ZTE and cut them off from the supply of high-quality semiconductors has led to a hardening of views in Beijing. China is making great financial efforts to reduce its dependence on “unreliable” Western partners. Under the concepts of “dual circulation” and “Indigenous innovation”, China is promoting domestic technology to the increasing exclusion of foreign companies.
Europe does not have the military and technological power of the USA. Nor can and should it imitate the state-controlled subsidy and centralized planning model of the People’s Republic of China. The European Union’s interest is to preserve what made the continent’s economies successful after the Second World War: integrated global value chains with mutual dependencies.
The basis for this was formed by trade relations that were liberal, multilateral, rules-based, and secured by a binding dispute settlement mechanism before the World Trade Organization (WTO). The rise of national protectionism, bilateralism, and the pursuit of self-sufficiency observed in parts of the world presents the EU with a challenge that it must overcome. But Europe’s response to this should not be to become more protectionist. Instead, it should uphold liberal, open values and stand up for them. What specifically needs to be done?
The fragmentation of the European VC market is one of the reasons why there are fewer “unicorns” in Europe overall than in China and the US, i.e. private companies with a value of more than one billion dollars. The national VC markets in Europe do not have a uniform legal framework, which hinders both investment activity and fundraising across borders. Removing barriers to cross-border investment would be an important step towards a more efficient allocation of capital and would help to realize VC return potential.
If Europe wants to survive the technology race against China in the long term, it must also accelerate its pace. To hold its own against China, it needs to develop better ideas and smarter technologies instead of protecting its own economy by retreating into isolation.
There is no doubt that China’s economic and technological rise and the growing rivalry between China and the US will be the biggest challenge for Germany and Europe in the coming years. China has the size and, under its current leadership, the political self-confidence to build an independent, autonomous economic system – a system with Chinese characteristics.
This article is part of the event series “Global China Conversations” organized by the Kiel Institute for the World Economy (IfW). On Thursday (30.01.2025, 14:00, CEST) Jörg Wuttke, Partner at DGA Group/Albright Stonebridge Group in Washington D.C., and Adam S. Posen, President of the Peterson Institute for International Economics, also in Washington D.C., will discuss the topic “How will Trump 2.0 reshape European-Chinese economic relations?” The webinar will be held in English. China.Table is the media partner of this event series.
Editor’s note: Today more than ever, discussing China means debating controversially. We want to reflect the diversity of opinions so that you can gain an insight into the breadth of the debate. Opinion articles do not reflect the opinion of the editorial team.
Theresa Terzer has been Head of Marketing at Sinolytics, a research-based consultancy focusing entirely on China, since January. The sinologist and marketing specialist previously worked for the IT consulting firm Inno-Focus Digital. She is based in Berlin.
Lukas Schoske has been Manager of Car Electronics at Volkswagen China since December. Schoske has been working for Volkswagen in the People’s Republic since 2021. Most recently, he worked in Hefei in the Expert Planning Battery Housing of the EV division. He moved to Shanghai for his new post.
Is something changing in your organization? Send a note for our personnel section to heads@table.media!
The often somewhat forced nature of Russian-Chinese relations can now also be seen in the Moscow metro. On Chinese New Year, a train with lanterns and flags wound its way through the tunnels of Line 3 – a friendship that literally runs deep.
China’s flagship space project SpaceSail is on course for success. 18 satellites were successfully launched into Earth orbit from the rocket launch center in Taiyuan on Thursday. A race for the best satellite network has begun up there. SpaceSail plans to install at least 10,000 satellites by 2030 in order to compete with Elon Musk’s Starlink. This is clearly also in the interests of the Chinese government, which wants to make China a “space superpower” by 2045.
However, there is still a long way to go, writes Leonardo Pape. The company has just 72 satellites in orbit – compared to Elon Musk’s 7,000 – but SpaceSail is rapidly catching up and is already offering its services in countries such as Brazil and Pakistan. There is no time to lose. After all, the war in Ukraine has shown how strategically important such networks can be for communication in an emergency.
Chinese workers and employees also go a long way when they want to improve workers’ rights in the country. Marcel Grzanna introduces the former train driver Li Weijie and his fight for the guild. Li’s story is a good example of how state trade unions in China serve the interests of the Communist Party rather than the workers themselves.
Against the backdrop of possible investments by Chinese manufacturers in Volkswagen factories in Germany, the way Chinese companies treat their workers in this country is likely to soon attract greater interest.
Li Weijie 李伟杰 can only shake his head at the good reputation of Chinese employers in Germany. While Chinese investors in this country are said to accept the rights of employees without resistance, Li has had very different experiences with state-owned companies in the People’s Republic.
More than a decade ago, Li unsuccessfully sued his employer for 920,000 yuan (the equivalent of around EUR 123,000 today) in compensation for overtime work and medical treatment. The 55-year-old was an engine driver at the Luoyang locomotive depot in Zhejiang province. He tried dozens of times to enforce his claim through the courts. But he cut his teeth on the Chinese justice system.
Today, Li is an undesirable person at the locomotive depot. His employment contract has long since been terminated. He lives in a dormitory in Luoyang and receives a monthly pension of 380 yuan (EUR 50). “This is completely unreasonable,” he complains in a video interview with Table.Briefings. He accuses the company of disregarding employees’ rights and ignoring communist values. He says he left the Communist Party years ago, disillusioned by this.
Li could not count on the support of a trade union. In China, the All-China Federation of Trade Unions (ACFTU) unites all trade unions in the country and is closely linked to the Communist Party. “The ACFTU essentially functions as an administrative arm of the party-state, which uses it as an instrument to harmonize the interests of the workers with those of the government,” summarizes Liu Mingwei, associate professor at Rutgers University in New Jersey, in his research. Trade unions are expected to promote harmony in labor relations. However, they “often face challenges in effectively representing the interests of workers”.
Li Weijie has therefore been campaigning single-handedly for years to improve working conditions for employees of state-owned railroad companies. He organizes protests, supports ex-colleagues in their lawsuits, and strives to make the Chinese public aware of the contradictions between the importance of workers in the country as propagated by the state and their treatment by state-owned companies.
However, Chinese media do not report on his involvement, nor do the security authorities allow him to make public appearances or organize his guild via social media. A chat group he set up once brought together 2,000 train drivers before it was shut down by censors. The group had once chosen June 16 as World Railway Day and even developed contacts in Japan, as Li recounts. But the more railroad employees joined, the more harshly the state reacted.
Last year, Li says, he was abducted by officials on the day before June 16 and held for two days in a remote forest without mobile phone reception – without a judicial basis, without any chance of such an abduction being punished under the rule of law. He was banned from traveling abroad. When he wanted to travel to the USA last year to meet railroad unionists there, officials at Shanghai airport prevented him from boarding the plane, he says.
“The government fears that I could organize a strike that would spread on a large scale,” Li believes. The company’s provincial office has therefore already made concessions and pays an additional 100 million yuan a year to the train drivers. Still far too little and limited to the province of Zhejiang, Li complains. Overtime is still not adequately paid, not enough breaks are granted and health care is not guaranteed.
Ever since production workers in a number of factories in Guangdong province went on strike in 2010, strikes have been a tried and tested means for employees in China to stand up for their rights. At that time, it was a Honda factory in Nanhai that led to work stoppages throughout the province – the joint ventures of German car manufacturers were also affected.
The strikes had consequences. The state obliged companies to pay minimum wages throughout the country and has since tightened its labor protection laws several times. Guangdong province even introduced the right to collective bargaining in 2014. However, implementation is still lagging behind. “Many companies have never complied, especially not the large state-owned enterprises,” says Boy Lüthje from the Institute for Social Research in Frankfurt am Main, who spent many years researching industrial relations in China at Sun Yat-Sen University and the South China University of Technology in Guangdong.
In fact, the workers there have the right to form a kind of company union and to present their demands to the management as a united front via elected employee representatives. Lüthje estimates that “perhaps 20 to 30 percent of companies in Guangdong” actually grant workers this right. Outside Guangdong, the figures are significantly lower. “Founding an industrial union would be the next step in China. But in terms of party politics, the legal framework has never been promoted further,” says Lüthje.
Strikes are still regarded as a tried and tested means for workers – especially in Guangdong. However, these are one-point movements, not coordinated actions that unite workers from the grassroots. “Because from a party perspective, this must not happen. Labor disputes are much more fragmented today,” says Lüthje.
The future of Chinese employers in Germany will probably only become clear when Chinese investors start investing in industrial sites on a large scale. The discussed interest from China in the Volkswagen plants in Osnabrück and Dresden could also develop into a litmus test for industrial relations between German employees and Chinese management.
So far, the construct has worked well. The study “Chinese investment in the Ruhr region” quotes an employee of ThyssenKrupp Tailored Blanks: “If I had the choice between Chinese and Americans, I’d prefer Chinese.” Americans do not care much about workers’ rights, “Chinese accept them”.
China’s flagship space project SpaceSail recently announced two new successes within the space of a few hours: 18 more of its satellites were launched into orbit last Thursday from the rocket launch center in Taiyuan in northern China. In addition, SpaceSail’s international offshoot expanded with a new branch in Kazakhstan.
The company behind SpaceSail is Shanghai Spacecom Satellite Technology (SSST), which is mainly funded by the Shanghai municipal government and the Chinese Academy of Sciences. The aim is to create a so-called mega-constellation, a dense satellite network in low earth orbit that can ensure internet coverage even in remote parts of the world. SpaceSail plans to install at least 10,000 satellites by the end of 2030 – and thus compete with Elon Musk’s Starlink
A few years ago, the Chinese government announced its goal of becoming a “space superpower” by 2045. On the way there, its own satellite mega-constellation is “a strategically important piece of space architecture”, says Blaine Curcio, analyst and publisher of the China Space Monitor, in an interview with Table.Briefings. The strategic importance of such systems can be seen, among other things, in Russia’s war against Ukraine. Ukraine is using Starlink to replace communication networks destroyed in the war, while Russia is presumably using the system illegally.
The devastating effects of dependence on foreign satellite infrastructure in the event of a crisis were painfully demonstrated to China decades ago: In the course of a confrontation in the Taiwan Strait in 1996, the People’s Liberation Army lost track of two of its three missiles fired in the strait – probably because the US had interrupted the GPS signal in the Pacific. As a result, China developed its own BeiDou navigation and positioning system. To this day, it is considered the largest Chinese investment in aerospace technology in history.
A powerful satellite mega-constellation would be a similarly big success for China. So far, however, SpaceX is far and away ahead. Elon Musk’s company already has around 7,000 satellites orbiting the Earth, around two-thirds of all active satellites. SpaceSail has just 72, but the project only launched its first satellites into orbit in August last year and has rapidly gained momentum since then.
According to analyst Curcio, SpaceSail is “undoubtedly the leader” within China. Among other things, SpaceSail has left its Chinese rival network GuoWang from the China SatNet Group behind – even though the latter was chosen by the central government a few years ago as an officially supported Starlink alternative. In a financing round in February 2024, SpaceSail raised around 6.7 billion yuan (just under EUR 900 million) in investor funds, more than any other space company in China. Curcio believes that around 300 more SpaceSail satellite launches are realistic for the current year, with even more possible in the following years.
Even though there is still a long way to go to achieve a powerful mega constellation, SSST is already trying to secure access to potential target markets. Last year, for example, the company signed an agreement with the Brazilian state telecommunications group Telebras to secure internet connections in remote areas by 2026. This puts SpaceSail in direct competition with Starlink, which currently has the largest market share in Brazil. SpaceSail has also expressed interest in entering the market in Pakistan.
SpaceSail presents itself as a commercial project, but the relationship with the Chinese government is obvious. The agreement in Brazil was a direct part of bilateral negotiations during Xi’s state visit in November. The proximity to the state serves as a door opener for friendly countries, but could also cause problems for the company. Curcio assumes that many Western countries will refuse to allow SpaceSail to enter the market.
In Germany, the parent company SSST has already had unpleasant experiences in this regard: A few years ago, the company entered the satellite business in Germany in a joint venture with Kleo Connect GmbH. SSST even became the majority shareholder, along with other Chinese investors.
Later, the investors from China insisted that satellite production for the joint venture should largely be located at the Shanghai-based company SECM. According to reports in the Financial Times, the fact that SECM also works for the Chinese military caused unease on the German side. The joint venture partners fell out. In the end, the German government prohibited a complete takeover by SSST as part of an investment review in 2023. The Shanghai-based company withdrew – and now prefers to make a new attempt on the domestic market.
In order to better enforce rights against trading platforms and traders from the EU and third countries in the future, the Federal Ministry for Economic Affairs has adopted an action plan for the e-commerce segment. The e-commerce action plan presented to the cabinet on Wednesday is intended to set an example “for fair competition and the protection of consumers from unsafe and dangerous products in online trade”, said Federal Minister for Economic Affairs Robert Habeck.
The high European standards must apply to everyone. “No one should gain an advantage by disregarding applicable law,” said Habeck. The online industry in Germany and the EU accuses providers from China in particular, such as Temu, Shein, and AliExpress, of not complying with European standards and distorting competition.
The German E-Commerce and Distance Selling Trade Association (BEVH) welcomed the government’s action and expressed confidence that there would now be better control of imports from third countries by providers such as Temu, “who damage fair competition in Europe with questionable business practices”.
According to estimates by the EU Commission, a total of four billion parcels entered the EU via global e-commerce platforms last year, as the Ministry of Economic Affairs explained. The customs and market surveillance authorities found “that many of the products do not comply with existing regulations on product safety, consumer protection, environmental and health standards, intellectual property rights, customs, and import regulations”. rtr/niw
DeepSeek is said to have used models from OpenAI to train its own AI. OpenAI told the Financial Times that there was some evidence of “distillation” that could have come from DeepSeek. Distillation is a technique used in the development industry to improve performance on smaller models. The results of larger, more powerful ones are used for this purpose.
Although industry experts say the practice is common in order to save costs, OpenAI considers it a violation of its terms of use. It states that users may not “copy” any of its services or “use results to develop models that compete with OpenAI”.
The criticism that DeepSeek’s models do not respond to terms censored by the Chinese government, such as Tank Man or the 1989 massacre on Tiananmen Square, and clumsily answer “Sorry, that’s beyond my capabilities at the moment”, clearly shows that there are not only gaps in content.
The International Campaign for Tibet (ICT) also warned that the research results of the Chinese AI DeepSeek should be treated “extremely critically”. “DeepSeek clearly wants to manipulate free and fact-based discourse in the public sphere,” said ICT Executive Director Kai Müller. He also warned that there was a great danger that DeepSeek would be used as an instrument of the Chinese Communist Party to spread propaganda. niw
The European Commission would like to give preference to local companies for high-tech contracts in the future. This is the result of its competition compass presented on Wednesday. Specifically, it concerns public procurement of critical technologies, which currently account for 14 percent of Europe’s gross domestic product. The preferential treatment of European companies is intended to stabilize supply chains, secure technology, and simplify the rules for start-ups, according to the document. These measures are also intended to counteract overcapacity and unfair competition.
The South China Morning Post reports that a “Buy European” regulation is unlikely to happen. The move comes just a few weeks after the EU determined that China’s own “Buy Local” regulations in the medical sector are illegal. The procurement agreement of the World Trade Organization (WTO) prohibits discrimination against foreign companies beyond a threshold value. Instead, the EU will create more incentives to invest in European companies in the future.
Even without the “Buy European” regulation, the proposal fits in with the spirit of the times. Both CDU chancellor candidate Friedrich Merz and French Prime Minister François Bayrou have warned of the threat posed by China to the European market. The EU therefore wants to reduce its dependence on Chinese markets. Instead, programs such as the Competitiveness Compass are intended to strengthen production and competition within Europe. ek
China is currently experiencing its Sputnik moment. Just as the Soviet Union surprised the USA with the first satellite in space in the late 1950s, China’s Sputnik is currently appearing for Europe in the form of artificial intelligence and futuristic, battery-powered vehicles. The Chinese AI start-up DeepSeek is showing the American tech champions Google, Apple and Meta that AI “Made in China” is world-class. The young company has developed an open standard relatively cheaply – R1 is said to have cost less than six million euros. At the same time, it is clear that the US sanctions on chip exports have stimulated Chinese innovation rather than hindering the country in the further development of future-proof technology. A wake-up call – also for Europe.
When the Chinese government presented its Made in China 2025 industrial strategy ten years ago, it caused irritation around the world. At that moment at the latest, it was clear that China’s path to becoming an industrial superpower would cause friction and rivalry with the Western, liberal economic system.
A rethink took place in Washington: Instead of “constructive engagement” with China, strategists in the US government and influential think tanks were now suddenly talking about “strategic competition” or “strategic rivalry”. The trade war launched by the Trump administration in 2018 has made innovation even more important.
The aggressive way in which the US has attacked Chinese companies such as Huawei and ZTE and cut them off from the supply of high-quality semiconductors has led to a hardening of views in Beijing. China is making great financial efforts to reduce its dependence on “unreliable” Western partners. Under the concepts of “dual circulation” and “Indigenous innovation”, China is promoting domestic technology to the increasing exclusion of foreign companies.
Europe does not have the military and technological power of the USA. Nor can and should it imitate the state-controlled subsidy and centralized planning model of the People’s Republic of China. The European Union’s interest is to preserve what made the continent’s economies successful after the Second World War: integrated global value chains with mutual dependencies.
The basis for this was formed by trade relations that were liberal, multilateral, rules-based, and secured by a binding dispute settlement mechanism before the World Trade Organization (WTO). The rise of national protectionism, bilateralism, and the pursuit of self-sufficiency observed in parts of the world presents the EU with a challenge that it must overcome. But Europe’s response to this should not be to become more protectionist. Instead, it should uphold liberal, open values and stand up for them. What specifically needs to be done?
The fragmentation of the European VC market is one of the reasons why there are fewer “unicorns” in Europe overall than in China and the US, i.e. private companies with a value of more than one billion dollars. The national VC markets in Europe do not have a uniform legal framework, which hinders both investment activity and fundraising across borders. Removing barriers to cross-border investment would be an important step towards a more efficient allocation of capital and would help to realize VC return potential.
If Europe wants to survive the technology race against China in the long term, it must also accelerate its pace. To hold its own against China, it needs to develop better ideas and smarter technologies instead of protecting its own economy by retreating into isolation.
There is no doubt that China’s economic and technological rise and the growing rivalry between China and the US will be the biggest challenge for Germany and Europe in the coming years. China has the size and, under its current leadership, the political self-confidence to build an independent, autonomous economic system – a system with Chinese characteristics.
This article is part of the event series “Global China Conversations” organized by the Kiel Institute for the World Economy (IfW). On Thursday (30.01.2025, 14:00, CEST) Jörg Wuttke, Partner at DGA Group/Albright Stonebridge Group in Washington D.C., and Adam S. Posen, President of the Peterson Institute for International Economics, also in Washington D.C., will discuss the topic “How will Trump 2.0 reshape European-Chinese economic relations?” The webinar will be held in English. China.Table is the media partner of this event series.
Editor’s note: Today more than ever, discussing China means debating controversially. We want to reflect the diversity of opinions so that you can gain an insight into the breadth of the debate. Opinion articles do not reflect the opinion of the editorial team.
Theresa Terzer has been Head of Marketing at Sinolytics, a research-based consultancy focusing entirely on China, since January. The sinologist and marketing specialist previously worked for the IT consulting firm Inno-Focus Digital. She is based in Berlin.
Lukas Schoske has been Manager of Car Electronics at Volkswagen China since December. Schoske has been working for Volkswagen in the People’s Republic since 2021. Most recently, he worked in Hefei in the Expert Planning Battery Housing of the EV division. He moved to Shanghai for his new post.
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