The German frigate “Baden-Wuerttemberg” and its supply ship “Frankfurt am Main” will soon depart South Korea for the Philippines – and observers have been waiting days for a signal whether the two German naval vessels will cross the Taiwan Strait or choose the conflict-free route east of Taiwan. In an interview with Michael Radunski a few days ago, US expert Isaac Kardon strongly supported the former. He argued that Germany’s ships would not take any military risk, but would make an important contribution to freedom of navigation.
Kardon’s rationale: If only the USA insisted on freedom of navigation, then Beijing would not consider this the norm. That is why he believes it is so important for as many countries as possible to pass through the Taiwan Strait, to make it seem like a matter of course – even in Beijing. Loud criticism resounds from there every time the Strait is crossed, as Beijing claims the Strait for itself as well as all of Taiwan. However, according to a report by the German news website “Der Spiegel” over the weekend, Berlin has apparently decided not to be deterred by possible retaliation this time. The ships will reportedly navigate through the Taiwan Strait. We will keep an eye on them.
Meanwhile, the German Federal Environment Agency has been investigating a case of fraud involving alleged carbon emission credits for months. It has been scrutinizing 21 projects by international – including German – companies in China for possible regulatory violations. The authority has now suspended the first eight projects. These projects involve mineral oil companies, but the authority refused to reveal any names. The focus is on so-called “Upstream Emission Reductions” (UER) projects, which, for example, oil companies can use to offset emissions towards their mandatory CO2 reduction targets when selling fossil fuels.
The Environment Agency announced Friday that the public prosecutor’s office was also investigating. And the Agency itself, along with lawyers, will now investigate the remaining 13 projects in China. Our analysis shows that the Ministry of the Environment has already found that “the system has proven to be opaque and prone to error.” A parliamentary review board could also be formed to investigate the conduct of international companies.
German warships have not yet passed through the Taiwan Strait – unlike the US and French navies, for example. For the German navy, involvement in the Indo-Pacific is still new. According to a report by the German news website Der Spiegel over the weekend, the two navy vessels will indeed sail through the Taiwan Strait from South Korea in just a few days. Shortly before the news became public, Table.Briefings spoke to US expert Isaac Kardon, who strongly supports such transits.
The German frigate Baden-Wuerttemberg and its supply ship Frankfurt am Main will leave South Korea this week for the Philippines – and the big question is: Will they sail through the Taiwan Strait?
This already shows that there is something terribly wrong
In what way?
That Germany is hesitating to sail through the Taiwan Strait. It is international water – and as far as I know, Germany as export champion and important trading nation relies on free and open trade.
Aren’t you slightly overestimating Germany’s role in the Taiwan issue? Two small German ships that may sail through the Strait once. Would that really make a difference?
It would indeed make a difference, especially if the German government indicates the reasons why they are sailing through and further states their intention to continue to sail through the Taiwan Strait. It’s not a minor US-China issue, it’s about a global norm that – except for some defined limitations under the law of the sea of where you may not transit – the world’s oceans are open for trade, for navigation, for warships and commercial ships alike. This is abundantly clear in the law of the sea. We cannot allow China to unilaterally annex some significant area of an international waterway that serves many other nations.
China has openly warned the German government not to drive through the Taiwan Strait.
In that regard, the first thing to say is: There is zero military risk. Most likely, the Chinese will be insistent and incessant radio badgering from a PLA Navy vessel that will certainly shadow them on their way through, saying something about Chinese maritime rights and interests, maybe something about Chinese sovereignty. But that’s it. They’re not putting themselves at any military risk. Zero.
But China will hardly leave it at a few radio calls …
Right. Germany should expect some displeasure on China’s part, too. Again, zero risk from a military or operational standpoint. But there will probably be some non-attributed retaliation of some kind, almost surely economic. They’ll probably pick on some part of the German economy. It’s quite a devious strategy. But I think that’s a price one has to pay. Germany has to choose between its long-term interest of having an open, free, trading system and its short-term interest of maybe not having one or another sector harmed.
What is the legal situation in the Taiwan Strait? China claims sovereignty rights.
These are waters in which there are high seas freedoms. That’s the key term to get technical about the Taiwan Strait. Because of its proximity to both Taiwan and the mainland, it’s an exclusive economic zone. An exclusive economic zone is an area where the coastal state enjoys exclusive economic rights to fish, to oil and gas. But they have no jurisdiction over navigation. If the world’s exclusive economic zones could be regulated like this, that would be 40 percent of the oceans. We would have a much, much more closed system.
Beijing claims that the US is harassing them and that this type of transit would only happen off the Chinese coast.
That’s only half of the picture. Chinese naval vessels also have started operating in exclusive economic zones off the United States. They’ve even operated in joint operations with the Russian Navy through, for example, the Bering Sea in US-exclusive economic zones. In the past, they have transited within 12 nautical miles of the US territory.
And the USA also objected, didn’t they?
Quite the opposite. What the United States has done in each of those cases is reaffirm the norm that you’re allowed to do that. This is the bargain of an open liberal system that the United States is trying to underwrite. Currently, China is taking advantage of these freedoms, even if it doesn’t accord them to other states. That lack of reciprocity is something we have talked about in terms of economic market access. And it’s the same in the case of freedom of navigation.
And now in the Taiwan Strait, it’s all about Germany?
Of course, it’s not only about Germany. The US regularly conducts freedom of navigation operations in the Taiwan Strait. Basically, it requires lots of countries, because the question is: What is the norm and what is the exception? If only the US sailed through the Taiwan Strait, it would be an exception – and the whole system would collapse. So, we have to keep it a norm that international waterways are free and open to anyone. If Germany and the Netherlands and France and India and Japan and Australia routinely transit through the Taiwan Strait, then the norm remains. Then, there’s no acquiescence in China trying to change this rule and norm.
So Germany should …
In the end, it’s on the German government to say we stand for the international rule of law. We don’t want to see the gradual erosion of the right to transit through an international waterway with high seas freedoms. Berlin should make it clear that we are carrying out and will continue to carry out this transit in line with normal practice. I think that’s in the German interest and in the interest of the international community.
Isaac B. Kardon is Senior Fellow for China studies at the Carnegie Endowment for International Peace in Washington, DC. He is concurrently Adjunct Professor at Johns Hopkins SAIS, and was formerly Assistant Professor at the US Naval War College (NWC), where he served as a research faculty member in the China Maritime Studies Institute. His research centers on the People’s Republic of China’s maritime power, with specialization in maritime disputes and the international law of the sea.
The German Federal Environment Agency (UBA) has refused to release the certificates in eight cases as part of the scandal surrounding the alleged fraud with climate certificates in China. Several large, internationally active companies had applied for the certificates in question, as the agency announced on Friday. Using the eight denied certificates, the companies in question wanted to offset a total of 215,000 tons of allegedly saved CO2 emissions.
The background is a systemic fraud that became public in June, in which German and, above all, Chinese suppliers, buyers, and auditors of these certificates are implicated. The agency initially refused to provide more detailed information on the companies involved for legal reasons. Specifically, the case concerns so-called “Upstream Emission Reductions” (UER) projects. Germany introduced the Upstream Emission Reduction Ordinance in 2018. As in 14 other EU countries, it was intended to help reduce CO2 emissions in transport by offsetting emission reductions during production against the obligation to reduce CO2 emissions from the sale of fossil fuels (GHG quota).
According to the UBA, this involves measures such as reducing CO2 emissions during fuel production, even before the corresponding crude oil is processed in the refinery. A typical example is stopping the so-called flaring of associated gases by converting the relevant facilities. In 2022, oil companies in Germany had to cut their emissions by 14 million tons of CO2 through this GHG quota. According to the Federal Ministry for the Environment, just over a tenth of this, 1.9 million tons, came from UER. In October 2023, there were first indications of irregularities in the certificates, especially from China: The certificates reportedly did not comply with the regulations or came from companies that did not exist.
The UBA launched a fraud investigation in cooperation with a law firm, foreign authorities, and the German public prosecutor’s office. According to the UBA, the allegations only became more concrete in late February 2024. The Ministry of the Environment stated, “The system has proven to be opaque and prone to errors – partly because German authorities can hardly monitor it.” The German government terminated the UER practice prematurely and is now investigating all projects for which applications have been submitted.
This means the end of eight projects for the time being. “No new UER certificates from these projects will be released onto the market. This is good news,” the Federal Environment Agency emphasized. In parallel, the Berlin public prosecutor’s office is currently investigating 17 people on suspicion of “joint commercial fraud.”
In seven of the eight UER projects currently suspended, the companies themselves withdrew the applications for the activation of UER certificates for 2023 after the UBA confronted the project sponsors “with serious legal and technical inconsistencies in their projects and threatened an on-site inspection.” The UBA prohibited the eighth project in China from issuing UER certificates because it had been initiated prematurely and without permission. This was discovered through technical analyses and satellite images.
The UBA announced plans to investigate 13 other projects in China. The UBA has not been given the opportunity to carry out on-site inspections for the majority of the 21 projects in China. This is a “very strong indication” that the project sponsors are not prepared to fulfill their obligations under the relevant regulations or to ensure the required monitoring of the projects, it said.
The UBA will also review other critical UER projects worldwide “until all allegations have been cleared up.” The UBA says that UER projects are attractive to the petroleum industry because they represent a comparatively cost-effective way to fulfill the GHG reduction quotas stipulated in the German Federal Immission Control Act.
However, the alleged fraud did not harm German car owners, as some have reported, but – in addition to the atmosphere – above all biofuel manufacturers, whose products lost market share due to the UER certificates. The “Initiative gegen Klimabetrug,” founded by the affected sector, estimates the damage at 7.9 billion euros and 8.8 million tons of greenhouse gases. It calls for compensation for the failed climate action and the cancellation of all certificates.
The CDU/CSU parliamentary group in the German Parliament has repeatedly summoned UBA head Dirk Messner and Environment Minister Steffi Lemke to a hearing before the Environment Committee. As environmental policy spokesperson Anja Weisgerber told Table.Briefings, “We are also planning to request another special meeting of the Environment Committee on this topic this week.” No decision has yet been made regarding a separate parliamentary review board on the issue. In any case, the cancellation of the eight UER projects is by no means the end of the fraud saga.
China’s economic engine stutters and struggles with poor demand, low – private – investment, high youth unemployment, and an underdeveloped social system. Meanwhile, Adam Tooze, professor at Columbia University in New York, believes that “the future of humanity is in China’s hands.” He is talking about climate change. The German newspaper FAZ recently noted: “China is driving the energy transition.” All of this is directly related to us.
Firstly, the weak demand for goods and investments in China is leading to, shall we say, subdued growth and, in any case, to massive price wars; this is reflected in restrained imports and the prices of Chinese export goods. If the world’s second-largest – in terms of purchasing power parity: largest – economy is struggling, then its partners are feeling the effects. The “Bloomberg GDP deflator” indicates the longest downturn in 25 years.
How to tackle this is part of a very differentiated debate in China: The former head of the Chinese Central Bank (PBOC) warns of deflationary pressure and calls for an active fiscal and monetary policy. Huang Yiping, Dean of the National School of Development and member of the Monetary Policy Committee of the Chinese Central Bank, had previously called for a shift towards consumption rather than investment. Huang, like Zhang Jun, dean of the Faculty of Economics at the renowned Fudan University, and Liu Shijin, former vice president of the state’s Development Research Centre, advocates more support for families with small or medium incomes.
These are three of quite a few public voices that point to deficits in the healthcare system, the – still-battered – property market or elderly care as examples of how to strengthen the domestic economy. Others warn of the risk of “welfareism,” which supposedly only encourages laziness and a sense of entitlement. Sounds familiar, doesn’t it?
What often goes unmentioned here is the high savings rate of forty percent, resulting from the need for private provision to pay for children’s education, the costs of illness or the private supplementation of low pensions. A solid and credible welfare state also makes economic sense, and not just in China.
It could release vast sums of money and boost the domestic economy. However, even in China, the necessary confidence in a stable future can neither be planned nor commanded. Announcements do not achieve much. This can also be seen in China. Pars pro toto: Raising the retirement age has been announced several times – and is still met with strong resistance. Unforgotten are the many protests against cuts in the so-called healthcare fund for the elderly.
You could say this is the flipside of the reform and opening up initiated by Deng Xiaoping. The sometimes enormous progress has given rise to new challenges; they result in unfinished homework and an internal debate that we should be more interested in.
This also applies to climate, environmental and energy issues; they represent global challenges – human tasks, as Willy Brandt and Mikhail Gorbachev said – that can only be overcome through cooperation. Climate change does not stop at national borders and cannot be overcome within such borders.
Worldwide, China is both the largest emitter of CO2 and the largest investor in renewable energies. The massive expansion in the use of solar and wind power in particular is shifting the balance; that is remarkable. But China cannot and will not forgo any energy source; not coal, which currently accounts for over 60 percent of the electricity mix; not nuclear energy, currently at five percent; and not water, wind, or solar. Everything is being expanded, modernized and geared towards reaching the “carbon peak” ahead of schedule using all available technologies.
That would be good news in the fight against climate change. However, this development is also a strong indication that de-risking with Chinese characteristics is taking place. The less the country relies on “external sources,” and the more diversified these are, the better. The more intensive the cooperation and the more diverse the partners, the better – but this is not just a Chinese perspective.
Rudolf Scharping served as Germany’s minister of defense between 1998 and 2002 and is the former national chairman of the Social Democratic Party. With his consulting firm RSBK, he has supported companies entering the Chinese market for over 15 years. On 18 and 19 September 2024, RSBK will host the 11th Sino-German Economic Conference in Stuttgart.
They are simply everywhere: Moon cakes are a must in China around the Moon Festival. These bakers in Taizhou, Jiangsu, make sure of that. It is impossible to tell from the outside whether they are sweet or savory, but some fillings are probably a matter of taste. Or how do you feel about salted egg yolks in the center of a sweet cake? This year, the Moon Festival falls on September 17.
The German frigate “Baden-Wuerttemberg” and its supply ship “Frankfurt am Main” will soon depart South Korea for the Philippines – and observers have been waiting days for a signal whether the two German naval vessels will cross the Taiwan Strait or choose the conflict-free route east of Taiwan. In an interview with Michael Radunski a few days ago, US expert Isaac Kardon strongly supported the former. He argued that Germany’s ships would not take any military risk, but would make an important contribution to freedom of navigation.
Kardon’s rationale: If only the USA insisted on freedom of navigation, then Beijing would not consider this the norm. That is why he believes it is so important for as many countries as possible to pass through the Taiwan Strait, to make it seem like a matter of course – even in Beijing. Loud criticism resounds from there every time the Strait is crossed, as Beijing claims the Strait for itself as well as all of Taiwan. However, according to a report by the German news website “Der Spiegel” over the weekend, Berlin has apparently decided not to be deterred by possible retaliation this time. The ships will reportedly navigate through the Taiwan Strait. We will keep an eye on them.
Meanwhile, the German Federal Environment Agency has been investigating a case of fraud involving alleged carbon emission credits for months. It has been scrutinizing 21 projects by international – including German – companies in China for possible regulatory violations. The authority has now suspended the first eight projects. These projects involve mineral oil companies, but the authority refused to reveal any names. The focus is on so-called “Upstream Emission Reductions” (UER) projects, which, for example, oil companies can use to offset emissions towards their mandatory CO2 reduction targets when selling fossil fuels.
The Environment Agency announced Friday that the public prosecutor’s office was also investigating. And the Agency itself, along with lawyers, will now investigate the remaining 13 projects in China. Our analysis shows that the Ministry of the Environment has already found that “the system has proven to be opaque and prone to error.” A parliamentary review board could also be formed to investigate the conduct of international companies.
German warships have not yet passed through the Taiwan Strait – unlike the US and French navies, for example. For the German navy, involvement in the Indo-Pacific is still new. According to a report by the German news website Der Spiegel over the weekend, the two navy vessels will indeed sail through the Taiwan Strait from South Korea in just a few days. Shortly before the news became public, Table.Briefings spoke to US expert Isaac Kardon, who strongly supports such transits.
The German frigate Baden-Wuerttemberg and its supply ship Frankfurt am Main will leave South Korea this week for the Philippines – and the big question is: Will they sail through the Taiwan Strait?
This already shows that there is something terribly wrong
In what way?
That Germany is hesitating to sail through the Taiwan Strait. It is international water – and as far as I know, Germany as export champion and important trading nation relies on free and open trade.
Aren’t you slightly overestimating Germany’s role in the Taiwan issue? Two small German ships that may sail through the Strait once. Would that really make a difference?
It would indeed make a difference, especially if the German government indicates the reasons why they are sailing through and further states their intention to continue to sail through the Taiwan Strait. It’s not a minor US-China issue, it’s about a global norm that – except for some defined limitations under the law of the sea of where you may not transit – the world’s oceans are open for trade, for navigation, for warships and commercial ships alike. This is abundantly clear in the law of the sea. We cannot allow China to unilaterally annex some significant area of an international waterway that serves many other nations.
China has openly warned the German government not to drive through the Taiwan Strait.
In that regard, the first thing to say is: There is zero military risk. Most likely, the Chinese will be insistent and incessant radio badgering from a PLA Navy vessel that will certainly shadow them on their way through, saying something about Chinese maritime rights and interests, maybe something about Chinese sovereignty. But that’s it. They’re not putting themselves at any military risk. Zero.
But China will hardly leave it at a few radio calls …
Right. Germany should expect some displeasure on China’s part, too. Again, zero risk from a military or operational standpoint. But there will probably be some non-attributed retaliation of some kind, almost surely economic. They’ll probably pick on some part of the German economy. It’s quite a devious strategy. But I think that’s a price one has to pay. Germany has to choose between its long-term interest of having an open, free, trading system and its short-term interest of maybe not having one or another sector harmed.
What is the legal situation in the Taiwan Strait? China claims sovereignty rights.
These are waters in which there are high seas freedoms. That’s the key term to get technical about the Taiwan Strait. Because of its proximity to both Taiwan and the mainland, it’s an exclusive economic zone. An exclusive economic zone is an area where the coastal state enjoys exclusive economic rights to fish, to oil and gas. But they have no jurisdiction over navigation. If the world’s exclusive economic zones could be regulated like this, that would be 40 percent of the oceans. We would have a much, much more closed system.
Beijing claims that the US is harassing them and that this type of transit would only happen off the Chinese coast.
That’s only half of the picture. Chinese naval vessels also have started operating in exclusive economic zones off the United States. They’ve even operated in joint operations with the Russian Navy through, for example, the Bering Sea in US-exclusive economic zones. In the past, they have transited within 12 nautical miles of the US territory.
And the USA also objected, didn’t they?
Quite the opposite. What the United States has done in each of those cases is reaffirm the norm that you’re allowed to do that. This is the bargain of an open liberal system that the United States is trying to underwrite. Currently, China is taking advantage of these freedoms, even if it doesn’t accord them to other states. That lack of reciprocity is something we have talked about in terms of economic market access. And it’s the same in the case of freedom of navigation.
And now in the Taiwan Strait, it’s all about Germany?
Of course, it’s not only about Germany. The US regularly conducts freedom of navigation operations in the Taiwan Strait. Basically, it requires lots of countries, because the question is: What is the norm and what is the exception? If only the US sailed through the Taiwan Strait, it would be an exception – and the whole system would collapse. So, we have to keep it a norm that international waterways are free and open to anyone. If Germany and the Netherlands and France and India and Japan and Australia routinely transit through the Taiwan Strait, then the norm remains. Then, there’s no acquiescence in China trying to change this rule and norm.
So Germany should …
In the end, it’s on the German government to say we stand for the international rule of law. We don’t want to see the gradual erosion of the right to transit through an international waterway with high seas freedoms. Berlin should make it clear that we are carrying out and will continue to carry out this transit in line with normal practice. I think that’s in the German interest and in the interest of the international community.
Isaac B. Kardon is Senior Fellow for China studies at the Carnegie Endowment for International Peace in Washington, DC. He is concurrently Adjunct Professor at Johns Hopkins SAIS, and was formerly Assistant Professor at the US Naval War College (NWC), where he served as a research faculty member in the China Maritime Studies Institute. His research centers on the People’s Republic of China’s maritime power, with specialization in maritime disputes and the international law of the sea.
The German Federal Environment Agency (UBA) has refused to release the certificates in eight cases as part of the scandal surrounding the alleged fraud with climate certificates in China. Several large, internationally active companies had applied for the certificates in question, as the agency announced on Friday. Using the eight denied certificates, the companies in question wanted to offset a total of 215,000 tons of allegedly saved CO2 emissions.
The background is a systemic fraud that became public in June, in which German and, above all, Chinese suppliers, buyers, and auditors of these certificates are implicated. The agency initially refused to provide more detailed information on the companies involved for legal reasons. Specifically, the case concerns so-called “Upstream Emission Reductions” (UER) projects. Germany introduced the Upstream Emission Reduction Ordinance in 2018. As in 14 other EU countries, it was intended to help reduce CO2 emissions in transport by offsetting emission reductions during production against the obligation to reduce CO2 emissions from the sale of fossil fuels (GHG quota).
According to the UBA, this involves measures such as reducing CO2 emissions during fuel production, even before the corresponding crude oil is processed in the refinery. A typical example is stopping the so-called flaring of associated gases by converting the relevant facilities. In 2022, oil companies in Germany had to cut their emissions by 14 million tons of CO2 through this GHG quota. According to the Federal Ministry for the Environment, just over a tenth of this, 1.9 million tons, came from UER. In October 2023, there were first indications of irregularities in the certificates, especially from China: The certificates reportedly did not comply with the regulations or came from companies that did not exist.
The UBA launched a fraud investigation in cooperation with a law firm, foreign authorities, and the German public prosecutor’s office. According to the UBA, the allegations only became more concrete in late February 2024. The Ministry of the Environment stated, “The system has proven to be opaque and prone to errors – partly because German authorities can hardly monitor it.” The German government terminated the UER practice prematurely and is now investigating all projects for which applications have been submitted.
This means the end of eight projects for the time being. “No new UER certificates from these projects will be released onto the market. This is good news,” the Federal Environment Agency emphasized. In parallel, the Berlin public prosecutor’s office is currently investigating 17 people on suspicion of “joint commercial fraud.”
In seven of the eight UER projects currently suspended, the companies themselves withdrew the applications for the activation of UER certificates for 2023 after the UBA confronted the project sponsors “with serious legal and technical inconsistencies in their projects and threatened an on-site inspection.” The UBA prohibited the eighth project in China from issuing UER certificates because it had been initiated prematurely and without permission. This was discovered through technical analyses and satellite images.
The UBA announced plans to investigate 13 other projects in China. The UBA has not been given the opportunity to carry out on-site inspections for the majority of the 21 projects in China. This is a “very strong indication” that the project sponsors are not prepared to fulfill their obligations under the relevant regulations or to ensure the required monitoring of the projects, it said.
The UBA will also review other critical UER projects worldwide “until all allegations have been cleared up.” The UBA says that UER projects are attractive to the petroleum industry because they represent a comparatively cost-effective way to fulfill the GHG reduction quotas stipulated in the German Federal Immission Control Act.
However, the alleged fraud did not harm German car owners, as some have reported, but – in addition to the atmosphere – above all biofuel manufacturers, whose products lost market share due to the UER certificates. The “Initiative gegen Klimabetrug,” founded by the affected sector, estimates the damage at 7.9 billion euros and 8.8 million tons of greenhouse gases. It calls for compensation for the failed climate action and the cancellation of all certificates.
The CDU/CSU parliamentary group in the German Parliament has repeatedly summoned UBA head Dirk Messner and Environment Minister Steffi Lemke to a hearing before the Environment Committee. As environmental policy spokesperson Anja Weisgerber told Table.Briefings, “We are also planning to request another special meeting of the Environment Committee on this topic this week.” No decision has yet been made regarding a separate parliamentary review board on the issue. In any case, the cancellation of the eight UER projects is by no means the end of the fraud saga.
China’s economic engine stutters and struggles with poor demand, low – private – investment, high youth unemployment, and an underdeveloped social system. Meanwhile, Adam Tooze, professor at Columbia University in New York, believes that “the future of humanity is in China’s hands.” He is talking about climate change. The German newspaper FAZ recently noted: “China is driving the energy transition.” All of this is directly related to us.
Firstly, the weak demand for goods and investments in China is leading to, shall we say, subdued growth and, in any case, to massive price wars; this is reflected in restrained imports and the prices of Chinese export goods. If the world’s second-largest – in terms of purchasing power parity: largest – economy is struggling, then its partners are feeling the effects. The “Bloomberg GDP deflator” indicates the longest downturn in 25 years.
How to tackle this is part of a very differentiated debate in China: The former head of the Chinese Central Bank (PBOC) warns of deflationary pressure and calls for an active fiscal and monetary policy. Huang Yiping, Dean of the National School of Development and member of the Monetary Policy Committee of the Chinese Central Bank, had previously called for a shift towards consumption rather than investment. Huang, like Zhang Jun, dean of the Faculty of Economics at the renowned Fudan University, and Liu Shijin, former vice president of the state’s Development Research Centre, advocates more support for families with small or medium incomes.
These are three of quite a few public voices that point to deficits in the healthcare system, the – still-battered – property market or elderly care as examples of how to strengthen the domestic economy. Others warn of the risk of “welfareism,” which supposedly only encourages laziness and a sense of entitlement. Sounds familiar, doesn’t it?
What often goes unmentioned here is the high savings rate of forty percent, resulting from the need for private provision to pay for children’s education, the costs of illness or the private supplementation of low pensions. A solid and credible welfare state also makes economic sense, and not just in China.
It could release vast sums of money and boost the domestic economy. However, even in China, the necessary confidence in a stable future can neither be planned nor commanded. Announcements do not achieve much. This can also be seen in China. Pars pro toto: Raising the retirement age has been announced several times – and is still met with strong resistance. Unforgotten are the many protests against cuts in the so-called healthcare fund for the elderly.
You could say this is the flipside of the reform and opening up initiated by Deng Xiaoping. The sometimes enormous progress has given rise to new challenges; they result in unfinished homework and an internal debate that we should be more interested in.
This also applies to climate, environmental and energy issues; they represent global challenges – human tasks, as Willy Brandt and Mikhail Gorbachev said – that can only be overcome through cooperation. Climate change does not stop at national borders and cannot be overcome within such borders.
Worldwide, China is both the largest emitter of CO2 and the largest investor in renewable energies. The massive expansion in the use of solar and wind power in particular is shifting the balance; that is remarkable. But China cannot and will not forgo any energy source; not coal, which currently accounts for over 60 percent of the electricity mix; not nuclear energy, currently at five percent; and not water, wind, or solar. Everything is being expanded, modernized and geared towards reaching the “carbon peak” ahead of schedule using all available technologies.
That would be good news in the fight against climate change. However, this development is also a strong indication that de-risking with Chinese characteristics is taking place. The less the country relies on “external sources,” and the more diversified these are, the better. The more intensive the cooperation and the more diverse the partners, the better – but this is not just a Chinese perspective.
Rudolf Scharping served as Germany’s minister of defense between 1998 and 2002 and is the former national chairman of the Social Democratic Party. With his consulting firm RSBK, he has supported companies entering the Chinese market for over 15 years. On 18 and 19 September 2024, RSBK will host the 11th Sino-German Economic Conference in Stuttgart.
They are simply everywhere: Moon cakes are a must in China around the Moon Festival. These bakers in Taizhou, Jiangsu, make sure of that. It is impossible to tell from the outside whether they are sweet or savory, but some fillings are probably a matter of taste. Or how do you feel about salted egg yolks in the center of a sweet cake? This year, the Moon Festival falls on September 17.
