2021 is the year of the German federal election. What is the SPD’s position on China? Nils Schmid, the SPD’s representative on the Foreign Affairs Committee, outlines the party’s China policy in today’s Opinion. He diagnoses a “mutual dependence” that makes cooperation necessary. But as a partner, one must also be allowed to honestly discuss mistakes and voice criticism.
Scott Rozelle has spent almost 40 years researching China’s education system. In 2008, the development economist received the Friendship Award of the People’s Republic – the country’s highest honor for foreign experts. In his new book “Invisible China“, Rozelle shows that the low level of education in the country could fall on China’s toes in a few years. The education system does not prepare people to survive in a highly developed economy. Especially in rural areas, there is a lack of good schools. And too many children suffer from health problems that further limit their education.
Which lessons Germany can learn from other countries’ pandemic responses is hotly debated. Felix Lee has examined the Taiwanese government’s largely exemplary approach. His conclusion: A good mix of quarantine regulations, a sophisticated contact tracing system, early readiness to wear masks, and a well-equipped healthcare system has saved Taiwan from a major wave of infection.
Beijing is trying to put political pressure on its neighbors through trade boycotts. After Australian wine, now pineapples from Taiwan are affected. Marcel Grzanna analyses the consequences of these boycotts and shows how the island republic is fighting back.
Microsoft was very clear on one point: “The group, we understand, has ties to state actors and operates out of China.” On Monday and Tuesday, the attackers continued to exploit vulnerabilities in tens of thousands of servers running the company’s software – including in Germany. Microsoft calls the group “Hafnium,” but that’s just a code name used by investigators, not the hackers’ self-designation.
The attack is now escalating into a state affair as the Biden administration takes it personally. Finally, US agencies are also working with Exchange. The president’s spokeswoman called the activities an “active threat,” announced the deployment of special investigators, and pointed out that the CIA intelligence agency is involved. The USA regularly invokes an agreement between former President Barack Obama and Xi Jinping in such cases. The two countries agreed to a digital truce in 2015. This makes the anger over continued attacks all the greater.
However, Microsoft and the US Department of Homeland Security did not provide any direct evidence that the Chinese state was actually behind the attacks. In fact, several hacker groups from different countries have attempted to exploit the vulnerability, which was noticed months ago. Freelance journalist Brian Krebs, who first reported on the case, clearly speaks of “aggressive Chinese groups” but leaves open whether state services are behind it.
A security vulnerability that allows hackers to access Exchange servers – it’s a nightmare for government agencies, banks and companies focused on intellectual property, but it can also be dangerous for private individuals. Whoever has access to the e-mail holds the key to the entire organization. This can also be used to prepare deeper attacks. After all, confidential information from the e-mail is just as exposed as the relationships between employees. It has never been easier to forge an e-mail from the boss.
The German authorities, therefore, send their warnings about the threat by post. They reckon that attackers who have hijacked an organization’s Exchange server will no longer let through the relevant information. Microsoft has theoretically closed the gap via an update. But if the administrators have not installed the latest version, this is of no use. The hackers can read the company’s e-mails.
China is one of the most common countries of origin for attacks on corporate and government IT. In many cases, individuals or independent groups are behind the attacks. In other cases, there are strong indications that government agencies are behind the attacks. The EU medicines agency EMA was also affected: The attackers were mainly interested in data related to COVID vaccines. And large corporations such as VW and Siemens are also repeatedly affected. Moreover, the problem is not new – and will remain with Western players for some time to come.
China’s former Industry Minister, Miao Wei, recently pointed out that the lack of talent in the innovation and high-tech sectors is severely hampering the development of the industrial sector. This may be true, but it is only part of a much larger problem. The focus on the high-tech sector obscures the view of a much bigger challenge: China’s “human capital” is insufficient to become a high-income country – at least that is the analysis of development economist Scott Rozelle, who spent nearly 40 years researching in China.
In his book “Invisible China: How the Urban-Rural Divide Threatens China’s Rise”, the Stanford University professor writes that China also needs highly educated engineers, IT experts, and AI researchers. But in addition to these top talents, a broad population that can perform “complex, non-routine tasks” is at least as important.
According to Rozelle’s analyses, China’s educational level is too low. Only 30 percent of Chinese have a high school education (equivalent to US high school), and 12.5 percent have a university degree. Of all middle-income countries, China has the lowest level of education and is below that of other countries such as South Africa, Thailand, and Mexico. According to Rozelle, the experience of those countries that have become high-income countries shows: In all of these countries, more than 50 percent of the population had higher educational attainment. With China’s current rate of 30 percent of the population with higher education, “the country could be in big trouble,” Rozelle writes.
In recent decades, Chinese growth has been based primarily on unskilled workers, whose low wages were a massive competitive advantage. They did not need sophisticated training to work on China’s vast construction sites, in its factories, or in its mines. And whenever wages threatened to rise, millions of workers from rural areas came to the cities – the labor potential seemed endless.
But China’s labor force peaked in 2010. Since 2005, the wage rate of even unskilled workers has been rising by about ten percent a year. The rising wages are causing tens of thousands of factories to close every year and tens of thousands of workers to lose their jobs every month, Rozelle said.
The problem is that the vast majority of these workers are not only too poorly educated to find work in the innovative high-tech industries. According to Rozelle, they also lack the basic skills to become specialists in the service sector, technicians in a chip factory, or to take on office jobs – activities that are important in a high-income country. The Economist cites the example of a smartphone factory: It takes 12 to 15 minutes to learn the steps to make smartphones, but to become mechanics, accountants, or electricians requires many more skills – for example, critical thinking, math skills, and computer and language skills. A university degree is not needed to teach these skills. Rather, the “middle class” in education policy, the secondary schools, are decisive.
The Chinese education system has so far failed to teach these skills, Rozelle says. The existing workforce is also too poorly educated to adapt in the short term. He estimates that 200 to 300 million people could be structurally “unemployable” in the future. Their only income option would be the informal sector.
Rozelle has located the origin of low educational attainment in rural China. Over the past 40 years, the Stanford economist and his various research teams have visited thousands of schools in rural China and interviewed millions of students during field research. The result: The urban workforce is much better educated than the rural workforce. This could become a massive problem in the future, as more than 70 percent of all children in China today have rural hukou (household registration system) status.
So China’s future workforce largely lives in rural areas, “where educational outcomes still lag far behind those in the city,” Rozelle says. According to his research, four million rural children a year leave education without completing secondary school. Children with rural hukou status who live in cities with their migrant worker parents are largely excluded from the better urban education system.
It is true that China has also invested heavily in vocational schools since 2002, and rural students are taking up the offer very strongly. But Rozelle and his research teams have found massive deficiencies in these schools. In some regions, up to 20 percent of the schools would exist only on paper in order to collect state subsidies.
Field research in hundreds of vocational schools shows: Students are barely learning the skills needed for higher-level jobs. One example: 91 percent of students failed to show improvement over the course of a year of math classes. And the accompanying work placements in companies would also generally result in little useful learning experience – many students would simply complete their placements in factories on conveyor belts or in temporary jobs. On average, one in three students leaves the vocational school system early.
But the educational malaise in rural areas often begins at a much younger age, according to Rozelle. Research in central and western China showed that 25-30 percent of primary school students suffered from iron deficiency. Thirty percent of rural students had vision problems but no glasses. And in Sichuan, Fujian, Hunan, Guizhou, and Yunnan provinces, 40 percent of students had parasitic intestinal worms. All of these health problems limit learning and concentration, Rozelle said. Rural elementary school students were already more than two grades behind urban children of the same age in fourth-grade math, a study of central China found.
Rozelle, who was honored in 2008 with the Friendship Award of the People’s Republic of China, the highest award for foreign experts, praises China’s efforts in recent years. In 2006, compulsory education was introduced for the first nine years of school, and school fees were abolished. By 2015, 80 percent of all students left school with a secondary degree. And between the late 1990s and 2005, the number of Chinese universities quadrupled. But even these efforts may not be enough, Rozelle warns.
Because in the 1970s, ’80s, and ’90s, Beijing invested far too little in the education system. Sixty-five percent of today’s workforce went to school under the poor education system of the Mao and Deng eras. According to Rozelle, it takes about 45 years to raise the education and training of a country’s entire workforce to the level required for a high-income country. China started too late and simply grew too fast.
And so it could well be true that China will have to wait another 30 or more years before it becomes an “industrial superpower”, as former Industry Minister Miao Wei also recently predicted – albeit with a different focus – because the educational deficiencies will not be remedied so quickly.
Scott Rozelle, with Natalie Hell, Invisible China: How the Urban-Rural Divide Threatens China’s Rise, University of Chicago Press, 6 October 2020, 231 pages, €27.20.
Germany and most countries in Europe continue to struggle with the pandemic despite hundreds of thousands of vaccinations a day. Taiwan has not even begun its vaccination campaign. Apart from a mask requirement, life in the island state is nevertheless running largely normally. Shops and restaurants are open without restrictions, the famous night markets of the capital Taipei are full. Major events can also take place. There have not been any lockdowns in Taiwan since the beginning of the pandemic.
Hardly any other country has managed to keep the numbers as low throughout the entire pandemic year as the island state in the East China Sea. Since the outbreak of the COVID crisis over a year ago, there have been over 2.5 million cases of infection in Germany, and the number of deaths is currently over 72,000. Taiwan, with its 23 million inhabitants, on the other hand, has officially counted only 942 infected people since the beginning of the pandemic, only nine of whom died with or from COVID-19. While Germany counts about 26,000 cases per million inhabitants, Taiwan has 38. “Taiwan’s excellent record in fighting the pandemic has become a sought-after model for discussion worldwide,” the Konrad Adenauer Foundation (KAS) notes in its current report on the country.
The report praises above all the “stringent tracking of infection chains”. In addition to “effective coordination between various authorities at the national and local level”, Taiwan was able to rely above all on a sophisticated data policy, writes David Merkle, author of the report. Only international air travel remained temporarily restricted. Even restaurants, cafés, and gyms did not have to close for a single day.
As a result, the country also managed to survive the crisis relatively unscathed economically. For the full year 2020, Taiwan recorded economic growth of three percent, more than the People’s Republic for the first time in more than 30 years. In contrast, the economies of most Western countries shrank.
Merkle writes that the population has shown a high degree of willingness to put the protection of personal data on the back burner in favor of social security when entering the country, in cases of suspected COVID, and during quarantine. This was an important prerequisite for successful pandemic management. At the same time, the Taiwanese government was extremely transparent in all steps and kept the population well-informed about the measures. According to Merkle, the pandemic control Made in Taiwan is, therefore, a “model for democratic societies worldwide”.
For some time now, Asia experts have been criticizing Germany for not paying enough attention to the countries of East Asia when it comes to pandemic management. And when they do, they usually point to the People’s Republic of China – as a cautionary tale. The authoritarian leadership in Beijing also succeeded in quickly bringing the pandemic under control. The price, however, was massive restrictions on personal rights. For weeks, people in Wuhan, a metropolis of ten million, were not even allowed to leave their homes. Violators were threatened with severe punishment. Sometimes even physical violence was used. China is, therefore, not a model for free societies.
Taiwan, on the other hand, also acted quickly, according to the KAS country report. But less strictly. In addition to the mix of quarantine regulations and a well-equipped health system, the national epidemic control center (Central Epidemic Command Center) succeeded in preventing mass outbreaks. Communication has also been effective. Every day at 2 p.m., the disease control agency CDC provides information about the pandemic, and usually, Health Minister Chen Shih-chung does it personally. People were much more consistent than in other countries in following rules, such as wearing protective masks. Transparency and explaining measures have apparently worked in Taiwan.
In Taiwan itself, there is also criticism of the government, especially from the opposition Kuomintang. They complain that too little testing for COVID is being carried out in Taiwan. In fact, since the beginning of the pandemic, Taiwan has carried out about 3,500 tests per million inhabitants, compared to 30 times as many in Germany. Taiwan’s media also reported a striking number of Taiwanese citizens who tested positive as soon as they traveled abroad. For Kuomintang politicians, this was an indication that there is a much higher number of people infected in Taiwan who have simply not shown any symptoms. But the fact is that at no time did the health system become overburdened. This indicates that the number of unreported cases was at least not exorbitantly high.
The opposition is also critical of the vaccination policy. Due to late orders for vaccines, the vaccination campaign could not even begin. Another factor contributing to delays is that Taiwan’s President Tsai Ing-wen refused to accept the coveted vaccine from the Mainz-based company Biotech when deliveries are made via the People’s Republic. Instead, Tsai wants to obtain the vaccine directly from Germany.
However, this criticism from the opposition is bouncing off the Taiwanese government. The infection figures are so low – there is apparently no need for haste.
A Chinese import ban has triggered a wave of international solidarity for pineapples from Taiwan. Large orders from Japan and Australia have arrived on the island in recent days to cushion the economic damage to Taiwanese farmers and processors. Unofficial diplomatic representatives from the US and Canada promoted via social media the consumption of the tropical fruit from the country that Beijing considers an inseparable part of the People’s Republic of China.
At the end of February, Chinese customs announced an import ban from March 1st at short notice and apparently without notice. The authority justified the decision with the fact that pests had been found in the fruits. In Taiwan, however, high-ranking politicians considered the measure to be an “unacceptable” and “unfair trade practice” intended to generate political pressure on the government in Taipei.
State President Tsai Ing-wen spoke of a “communication like an ambush” that was “obviously not a normal trade decision”. Economy Minister Wang Mei-hua said the unilateral ban was a violation of international trade rules because the amount of infested fruit was minimal, according to Taiwanese sources. China is the largest buyer of pineapples from Taiwan. More than 90 percent of all Taiwanese exports went to the People’s Republic in 2020.
Taiwan’s Foreign Minister Joseph Wu called on the international community for support via Twitter. At an online briefing of the Inter-Parliamentary Alliance on China (IPAC), which is composed of more than 200 parliamentarians from 19 countries and also has German members, Wu initiated a solidarity campaign under the hashtag #FreedomPineapple to boost the sale of the fruit abroad. For this purpose, Wu posted a pineapple on his desk.
The hashtag was not chosen by chance but followed an action called #FreedomWine, which was also initiated at an IPAC meeting at the end of last year. At that time, the parliamentarians reacted to Chinese import tariffs on Australian wine amounting to about 200 percent. The tariffs were received outside China as a punishment of the Australian government after Canberra had, among other things, loudly demanded an independent clarification of the global spread of COVID-19 from Wuhan. At the time, numerous politicians from around the world took to social media to toast the online community with a glass of Australian wine. Taiwan’s foreign ministry also participated with a tweet. President Tsai stressed her government’s willingness to support Australia to the best of its ability.
Now came the revenge. Australia doubled its imports of pineapples to 6,000 tons from Taiwan. Japan also increased its orders at short notice to a record high of 6,200 tons and justified this with Taiwan’s quick and unbureaucratic help after the tsunami and nuclear disaster ten years ago in Fukushima. Representatives of the Canadian Trade Office in Taiwan, described by the Canadian press as de facto diplomats, made the front page of the National Post newspaper’s business section with a pineapple pizza party. On their Facebook page, the representatives had smugly commented on a related picture: “We in the Canadian office like pineapple pizza, especially pineapple from Taiwan.” Diplomats from the American Institute in Taiwan, which is considered the US representative office on the island, also had their picture taken with the fruit.
The result of the pineapple offensive is remarkable. Not only did Japan and Australia increase their imports, Taiwan’s population also provided considerable relief to farmers. Within four days of China’s announcement, Taiwanese farmers had received pre-orders of 41,687 tons from companies, online platforms, or consumers. That was several hundred tons more in volume than was imported into China from Taiwan last year. On social media, users have been posting pictures of pineapples for days, along with suggestions on how to tastily incorporate them into daily diets, sometimes in combination with Australian wine. Also, foreign YouTubers living in Taiwan uploaded numerous videos, in which they often condemn the import freeze of their big neighbor with a pinch of humor and make fun of it.
What Beijing might like even less than pineapples from Taiwan and wine from Australia is the fact that various trading partners across borders have now joined forces and organized resistance on several occasions. However, similar solidarity actions are likely to be less effective for other products not intended for consumption. China has imposed import restrictions on Australian coal producers, among others. There is a hashtag #FreedomCoal on social media. However, the response to this has so far been negligible.
The COVID vaccine – the great hope in the little vials – is our most effective weapon in the fight against the pandemic. Consequently, the distribution of the scarce commodity is a political issue not only in Germany but worldwide. The photos of government representatives having themselves photographed when vaccines made in China arrived, therefore, went around the world in no time at all. They are images meant to tell the story of the Chinese leadership’s supposed success, of a China that defeated COVID-19 and now wants to make vaccines available to the world as a “global public good” (Xi Jinping), while the West is still struggling with the virus at home.
China is not only a partner and economic competitor for Germany, but it’s also a systemic rival. It has become increasingly clear, especially in recent years, that this limits the possibilities for cooperation and fair competition.
To meet the boundless challenges of our time – from climate change to pandemics – we must work together, if only out of self-interest. The rapid spread of viral mutants reminds us of our interdependence. In our globalized world, no one is safe as long as the virus continues to ravage some regions of the world and the resulting mutations threaten us. Instead of vaccine nationalism and bilateral vaccine diplomacy, we, therefore, need more vaccine multilateralism because this is the only way to achieve rapid and equitable distribution of vaccines. Both China and the West must therefore continue to increase support for the Covax global vaccination program.
An honest approach to mistakes is also part of a partnership. Only this way can we learn the right lessons from today’s crisis for tomorrow’s pandemics. There was justified criticism of the German government for the export ban on respiratory masks in spring 2020, as well as the current criticism of the EU’s vaccine procurement. Equally, clear criticism must be possible of the weaknesses of COVID management in China – especially the irresponsible lack of transparency surrounding the outbreak in Wuhan. Findings about the virus outbreak must be incorporated into our deliberations on how we can make the multilateral health architecture more resilient to future crises. For this, we also need cooperation with China, which is not the first time it has been the source of a pandemic.
The COVID-19 pandemic and the measures taken against it triggered a dramatic slump in the global economy and showed us how far our interdependence with China has advanced. But asymmetric dependencies in systemically important areas also make us vulnerable, as the supply shortages of medical goods at the start of the pandemic showed. However, we will continue to reject calls for decoupling from China, as this would benefit no one and certainly not our export industry. What is needed instead is a partial re-coupling that reduces one-sided dependencies, for example, by further diversifying our relations in Asia, as envisaged in the German Federal Government’s Indo-Pacific guidelines. Interdependencies are not a bad thing per se either, because mutual dependencies promote cooperation. In view of China’s economic successes, however, we should demand a level playing field and stricter reciprocity in our trade relations, especially in the EU-China investment agreement.
The COVID crisis is acting as a catalyst in the systemic conflict with China. The Chinese economy is already humming again and is becoming – as it did after the economic crisis after 2008 – the engine of global recovery. The successes are fuelling the debate about the advantages and disadvantages of the Western system of a democratic constitutional state with a social market economy versus the Chinese surveillance dictatorship with a controlled state economy. The illusionless view of China’s development also shows that hopes for political liberalization in the country and integration into a liberal world order will not be fulfilled in the foreseeable future. On the contrary, the Chinese leadership is becoming increasingly repressive internally and aggressive externally, as demonstrated by the massive human rights violations against the Uyghurs in Xinjiang, the far-reaching encroachment on Hong Kong’s autonomy, and the threatening military gestures against Taiwan.
It is clear to us that we can only successfully defend our values and interests against China together with our European and transatlantic partners. We must therefore prevent China from driving a wedge between us by “bilateralizing” relations. What we need is a common robust China policy. Firmly anchored in the Western community of security and values, this is our foundation for a political dialogue with Beijing on an equal footing. Germany and the EU should therefore seize the opportunity that, in Joe Biden, we once again have a convinced democrat at our side and closely coordinate our China policy with him.
Thanks to the COVID-19 vaccines, there is light at the end of the tunnel in the crisis. Unfortunately, we lack a similarly effective means of containing autocratic tendencies in the world. But here, too, the resilience of our own system – the health of our democracy – is crucial. So instead of China’s containment, we need first and foremost to strengthen democracy – at home and around the world. That’s why we should actively support the “Summit for Democracy” that President Biden has announced – so that the torch of democracy will soon shine brightly again.
2021 is the year of the German federal election. What is the SPD’s position on China? Nils Schmid, the SPD’s representative on the Foreign Affairs Committee, outlines the party’s China policy in today’s Opinion. He diagnoses a “mutual dependence” that makes cooperation necessary. But as a partner, one must also be allowed to honestly discuss mistakes and voice criticism.
Scott Rozelle has spent almost 40 years researching China’s education system. In 2008, the development economist received the Friendship Award of the People’s Republic – the country’s highest honor for foreign experts. In his new book “Invisible China“, Rozelle shows that the low level of education in the country could fall on China’s toes in a few years. The education system does not prepare people to survive in a highly developed economy. Especially in rural areas, there is a lack of good schools. And too many children suffer from health problems that further limit their education.
Which lessons Germany can learn from other countries’ pandemic responses is hotly debated. Felix Lee has examined the Taiwanese government’s largely exemplary approach. His conclusion: A good mix of quarantine regulations, a sophisticated contact tracing system, early readiness to wear masks, and a well-equipped healthcare system has saved Taiwan from a major wave of infection.
Beijing is trying to put political pressure on its neighbors through trade boycotts. After Australian wine, now pineapples from Taiwan are affected. Marcel Grzanna analyses the consequences of these boycotts and shows how the island republic is fighting back.
Microsoft was very clear on one point: “The group, we understand, has ties to state actors and operates out of China.” On Monday and Tuesday, the attackers continued to exploit vulnerabilities in tens of thousands of servers running the company’s software – including in Germany. Microsoft calls the group “Hafnium,” but that’s just a code name used by investigators, not the hackers’ self-designation.
The attack is now escalating into a state affair as the Biden administration takes it personally. Finally, US agencies are also working with Exchange. The president’s spokeswoman called the activities an “active threat,” announced the deployment of special investigators, and pointed out that the CIA intelligence agency is involved. The USA regularly invokes an agreement between former President Barack Obama and Xi Jinping in such cases. The two countries agreed to a digital truce in 2015. This makes the anger over continued attacks all the greater.
However, Microsoft and the US Department of Homeland Security did not provide any direct evidence that the Chinese state was actually behind the attacks. In fact, several hacker groups from different countries have attempted to exploit the vulnerability, which was noticed months ago. Freelance journalist Brian Krebs, who first reported on the case, clearly speaks of “aggressive Chinese groups” but leaves open whether state services are behind it.
A security vulnerability that allows hackers to access Exchange servers – it’s a nightmare for government agencies, banks and companies focused on intellectual property, but it can also be dangerous for private individuals. Whoever has access to the e-mail holds the key to the entire organization. This can also be used to prepare deeper attacks. After all, confidential information from the e-mail is just as exposed as the relationships between employees. It has never been easier to forge an e-mail from the boss.
The German authorities, therefore, send their warnings about the threat by post. They reckon that attackers who have hijacked an organization’s Exchange server will no longer let through the relevant information. Microsoft has theoretically closed the gap via an update. But if the administrators have not installed the latest version, this is of no use. The hackers can read the company’s e-mails.
China is one of the most common countries of origin for attacks on corporate and government IT. In many cases, individuals or independent groups are behind the attacks. In other cases, there are strong indications that government agencies are behind the attacks. The EU medicines agency EMA was also affected: The attackers were mainly interested in data related to COVID vaccines. And large corporations such as VW and Siemens are also repeatedly affected. Moreover, the problem is not new – and will remain with Western players for some time to come.
China’s former Industry Minister, Miao Wei, recently pointed out that the lack of talent in the innovation and high-tech sectors is severely hampering the development of the industrial sector. This may be true, but it is only part of a much larger problem. The focus on the high-tech sector obscures the view of a much bigger challenge: China’s “human capital” is insufficient to become a high-income country – at least that is the analysis of development economist Scott Rozelle, who spent nearly 40 years researching in China.
In his book “Invisible China: How the Urban-Rural Divide Threatens China’s Rise”, the Stanford University professor writes that China also needs highly educated engineers, IT experts, and AI researchers. But in addition to these top talents, a broad population that can perform “complex, non-routine tasks” is at least as important.
According to Rozelle’s analyses, China’s educational level is too low. Only 30 percent of Chinese have a high school education (equivalent to US high school), and 12.5 percent have a university degree. Of all middle-income countries, China has the lowest level of education and is below that of other countries such as South Africa, Thailand, and Mexico. According to Rozelle, the experience of those countries that have become high-income countries shows: In all of these countries, more than 50 percent of the population had higher educational attainment. With China’s current rate of 30 percent of the population with higher education, “the country could be in big trouble,” Rozelle writes.
In recent decades, Chinese growth has been based primarily on unskilled workers, whose low wages were a massive competitive advantage. They did not need sophisticated training to work on China’s vast construction sites, in its factories, or in its mines. And whenever wages threatened to rise, millions of workers from rural areas came to the cities – the labor potential seemed endless.
But China’s labor force peaked in 2010. Since 2005, the wage rate of even unskilled workers has been rising by about ten percent a year. The rising wages are causing tens of thousands of factories to close every year and tens of thousands of workers to lose their jobs every month, Rozelle said.
The problem is that the vast majority of these workers are not only too poorly educated to find work in the innovative high-tech industries. According to Rozelle, they also lack the basic skills to become specialists in the service sector, technicians in a chip factory, or to take on office jobs – activities that are important in a high-income country. The Economist cites the example of a smartphone factory: It takes 12 to 15 minutes to learn the steps to make smartphones, but to become mechanics, accountants, or electricians requires many more skills – for example, critical thinking, math skills, and computer and language skills. A university degree is not needed to teach these skills. Rather, the “middle class” in education policy, the secondary schools, are decisive.
The Chinese education system has so far failed to teach these skills, Rozelle says. The existing workforce is also too poorly educated to adapt in the short term. He estimates that 200 to 300 million people could be structurally “unemployable” in the future. Their only income option would be the informal sector.
Rozelle has located the origin of low educational attainment in rural China. Over the past 40 years, the Stanford economist and his various research teams have visited thousands of schools in rural China and interviewed millions of students during field research. The result: The urban workforce is much better educated than the rural workforce. This could become a massive problem in the future, as more than 70 percent of all children in China today have rural hukou (household registration system) status.
So China’s future workforce largely lives in rural areas, “where educational outcomes still lag far behind those in the city,” Rozelle says. According to his research, four million rural children a year leave education without completing secondary school. Children with rural hukou status who live in cities with their migrant worker parents are largely excluded from the better urban education system.
It is true that China has also invested heavily in vocational schools since 2002, and rural students are taking up the offer very strongly. But Rozelle and his research teams have found massive deficiencies in these schools. In some regions, up to 20 percent of the schools would exist only on paper in order to collect state subsidies.
Field research in hundreds of vocational schools shows: Students are barely learning the skills needed for higher-level jobs. One example: 91 percent of students failed to show improvement over the course of a year of math classes. And the accompanying work placements in companies would also generally result in little useful learning experience – many students would simply complete their placements in factories on conveyor belts or in temporary jobs. On average, one in three students leaves the vocational school system early.
But the educational malaise in rural areas often begins at a much younger age, according to Rozelle. Research in central and western China showed that 25-30 percent of primary school students suffered from iron deficiency. Thirty percent of rural students had vision problems but no glasses. And in Sichuan, Fujian, Hunan, Guizhou, and Yunnan provinces, 40 percent of students had parasitic intestinal worms. All of these health problems limit learning and concentration, Rozelle said. Rural elementary school students were already more than two grades behind urban children of the same age in fourth-grade math, a study of central China found.
Rozelle, who was honored in 2008 with the Friendship Award of the People’s Republic of China, the highest award for foreign experts, praises China’s efforts in recent years. In 2006, compulsory education was introduced for the first nine years of school, and school fees were abolished. By 2015, 80 percent of all students left school with a secondary degree. And between the late 1990s and 2005, the number of Chinese universities quadrupled. But even these efforts may not be enough, Rozelle warns.
Because in the 1970s, ’80s, and ’90s, Beijing invested far too little in the education system. Sixty-five percent of today’s workforce went to school under the poor education system of the Mao and Deng eras. According to Rozelle, it takes about 45 years to raise the education and training of a country’s entire workforce to the level required for a high-income country. China started too late and simply grew too fast.
And so it could well be true that China will have to wait another 30 or more years before it becomes an “industrial superpower”, as former Industry Minister Miao Wei also recently predicted – albeit with a different focus – because the educational deficiencies will not be remedied so quickly.
Scott Rozelle, with Natalie Hell, Invisible China: How the Urban-Rural Divide Threatens China’s Rise, University of Chicago Press, 6 October 2020, 231 pages, €27.20.
Germany and most countries in Europe continue to struggle with the pandemic despite hundreds of thousands of vaccinations a day. Taiwan has not even begun its vaccination campaign. Apart from a mask requirement, life in the island state is nevertheless running largely normally. Shops and restaurants are open without restrictions, the famous night markets of the capital Taipei are full. Major events can also take place. There have not been any lockdowns in Taiwan since the beginning of the pandemic.
Hardly any other country has managed to keep the numbers as low throughout the entire pandemic year as the island state in the East China Sea. Since the outbreak of the COVID crisis over a year ago, there have been over 2.5 million cases of infection in Germany, and the number of deaths is currently over 72,000. Taiwan, with its 23 million inhabitants, on the other hand, has officially counted only 942 infected people since the beginning of the pandemic, only nine of whom died with or from COVID-19. While Germany counts about 26,000 cases per million inhabitants, Taiwan has 38. “Taiwan’s excellent record in fighting the pandemic has become a sought-after model for discussion worldwide,” the Konrad Adenauer Foundation (KAS) notes in its current report on the country.
The report praises above all the “stringent tracking of infection chains”. In addition to “effective coordination between various authorities at the national and local level”, Taiwan was able to rely above all on a sophisticated data policy, writes David Merkle, author of the report. Only international air travel remained temporarily restricted. Even restaurants, cafés, and gyms did not have to close for a single day.
As a result, the country also managed to survive the crisis relatively unscathed economically. For the full year 2020, Taiwan recorded economic growth of three percent, more than the People’s Republic for the first time in more than 30 years. In contrast, the economies of most Western countries shrank.
Merkle writes that the population has shown a high degree of willingness to put the protection of personal data on the back burner in favor of social security when entering the country, in cases of suspected COVID, and during quarantine. This was an important prerequisite for successful pandemic management. At the same time, the Taiwanese government was extremely transparent in all steps and kept the population well-informed about the measures. According to Merkle, the pandemic control Made in Taiwan is, therefore, a “model for democratic societies worldwide”.
For some time now, Asia experts have been criticizing Germany for not paying enough attention to the countries of East Asia when it comes to pandemic management. And when they do, they usually point to the People’s Republic of China – as a cautionary tale. The authoritarian leadership in Beijing also succeeded in quickly bringing the pandemic under control. The price, however, was massive restrictions on personal rights. For weeks, people in Wuhan, a metropolis of ten million, were not even allowed to leave their homes. Violators were threatened with severe punishment. Sometimes even physical violence was used. China is, therefore, not a model for free societies.
Taiwan, on the other hand, also acted quickly, according to the KAS country report. But less strictly. In addition to the mix of quarantine regulations and a well-equipped health system, the national epidemic control center (Central Epidemic Command Center) succeeded in preventing mass outbreaks. Communication has also been effective. Every day at 2 p.m., the disease control agency CDC provides information about the pandemic, and usually, Health Minister Chen Shih-chung does it personally. People were much more consistent than in other countries in following rules, such as wearing protective masks. Transparency and explaining measures have apparently worked in Taiwan.
In Taiwan itself, there is also criticism of the government, especially from the opposition Kuomintang. They complain that too little testing for COVID is being carried out in Taiwan. In fact, since the beginning of the pandemic, Taiwan has carried out about 3,500 tests per million inhabitants, compared to 30 times as many in Germany. Taiwan’s media also reported a striking number of Taiwanese citizens who tested positive as soon as they traveled abroad. For Kuomintang politicians, this was an indication that there is a much higher number of people infected in Taiwan who have simply not shown any symptoms. But the fact is that at no time did the health system become overburdened. This indicates that the number of unreported cases was at least not exorbitantly high.
The opposition is also critical of the vaccination policy. Due to late orders for vaccines, the vaccination campaign could not even begin. Another factor contributing to delays is that Taiwan’s President Tsai Ing-wen refused to accept the coveted vaccine from the Mainz-based company Biotech when deliveries are made via the People’s Republic. Instead, Tsai wants to obtain the vaccine directly from Germany.
However, this criticism from the opposition is bouncing off the Taiwanese government. The infection figures are so low – there is apparently no need for haste.
A Chinese import ban has triggered a wave of international solidarity for pineapples from Taiwan. Large orders from Japan and Australia have arrived on the island in recent days to cushion the economic damage to Taiwanese farmers and processors. Unofficial diplomatic representatives from the US and Canada promoted via social media the consumption of the tropical fruit from the country that Beijing considers an inseparable part of the People’s Republic of China.
At the end of February, Chinese customs announced an import ban from March 1st at short notice and apparently without notice. The authority justified the decision with the fact that pests had been found in the fruits. In Taiwan, however, high-ranking politicians considered the measure to be an “unacceptable” and “unfair trade practice” intended to generate political pressure on the government in Taipei.
State President Tsai Ing-wen spoke of a “communication like an ambush” that was “obviously not a normal trade decision”. Economy Minister Wang Mei-hua said the unilateral ban was a violation of international trade rules because the amount of infested fruit was minimal, according to Taiwanese sources. China is the largest buyer of pineapples from Taiwan. More than 90 percent of all Taiwanese exports went to the People’s Republic in 2020.
Taiwan’s Foreign Minister Joseph Wu called on the international community for support via Twitter. At an online briefing of the Inter-Parliamentary Alliance on China (IPAC), which is composed of more than 200 parliamentarians from 19 countries and also has German members, Wu initiated a solidarity campaign under the hashtag #FreedomPineapple to boost the sale of the fruit abroad. For this purpose, Wu posted a pineapple on his desk.
The hashtag was not chosen by chance but followed an action called #FreedomWine, which was also initiated at an IPAC meeting at the end of last year. At that time, the parliamentarians reacted to Chinese import tariffs on Australian wine amounting to about 200 percent. The tariffs were received outside China as a punishment of the Australian government after Canberra had, among other things, loudly demanded an independent clarification of the global spread of COVID-19 from Wuhan. At the time, numerous politicians from around the world took to social media to toast the online community with a glass of Australian wine. Taiwan’s foreign ministry also participated with a tweet. President Tsai stressed her government’s willingness to support Australia to the best of its ability.
Now came the revenge. Australia doubled its imports of pineapples to 6,000 tons from Taiwan. Japan also increased its orders at short notice to a record high of 6,200 tons and justified this with Taiwan’s quick and unbureaucratic help after the tsunami and nuclear disaster ten years ago in Fukushima. Representatives of the Canadian Trade Office in Taiwan, described by the Canadian press as de facto diplomats, made the front page of the National Post newspaper’s business section with a pineapple pizza party. On their Facebook page, the representatives had smugly commented on a related picture: “We in the Canadian office like pineapple pizza, especially pineapple from Taiwan.” Diplomats from the American Institute in Taiwan, which is considered the US representative office on the island, also had their picture taken with the fruit.
The result of the pineapple offensive is remarkable. Not only did Japan and Australia increase their imports, Taiwan’s population also provided considerable relief to farmers. Within four days of China’s announcement, Taiwanese farmers had received pre-orders of 41,687 tons from companies, online platforms, or consumers. That was several hundred tons more in volume than was imported into China from Taiwan last year. On social media, users have been posting pictures of pineapples for days, along with suggestions on how to tastily incorporate them into daily diets, sometimes in combination with Australian wine. Also, foreign YouTubers living in Taiwan uploaded numerous videos, in which they often condemn the import freeze of their big neighbor with a pinch of humor and make fun of it.
What Beijing might like even less than pineapples from Taiwan and wine from Australia is the fact that various trading partners across borders have now joined forces and organized resistance on several occasions. However, similar solidarity actions are likely to be less effective for other products not intended for consumption. China has imposed import restrictions on Australian coal producers, among others. There is a hashtag #FreedomCoal on social media. However, the response to this has so far been negligible.
The COVID vaccine – the great hope in the little vials – is our most effective weapon in the fight against the pandemic. Consequently, the distribution of the scarce commodity is a political issue not only in Germany but worldwide. The photos of government representatives having themselves photographed when vaccines made in China arrived, therefore, went around the world in no time at all. They are images meant to tell the story of the Chinese leadership’s supposed success, of a China that defeated COVID-19 and now wants to make vaccines available to the world as a “global public good” (Xi Jinping), while the West is still struggling with the virus at home.
China is not only a partner and economic competitor for Germany, but it’s also a systemic rival. It has become increasingly clear, especially in recent years, that this limits the possibilities for cooperation and fair competition.
To meet the boundless challenges of our time – from climate change to pandemics – we must work together, if only out of self-interest. The rapid spread of viral mutants reminds us of our interdependence. In our globalized world, no one is safe as long as the virus continues to ravage some regions of the world and the resulting mutations threaten us. Instead of vaccine nationalism and bilateral vaccine diplomacy, we, therefore, need more vaccine multilateralism because this is the only way to achieve rapid and equitable distribution of vaccines. Both China and the West must therefore continue to increase support for the Covax global vaccination program.
An honest approach to mistakes is also part of a partnership. Only this way can we learn the right lessons from today’s crisis for tomorrow’s pandemics. There was justified criticism of the German government for the export ban on respiratory masks in spring 2020, as well as the current criticism of the EU’s vaccine procurement. Equally, clear criticism must be possible of the weaknesses of COVID management in China – especially the irresponsible lack of transparency surrounding the outbreak in Wuhan. Findings about the virus outbreak must be incorporated into our deliberations on how we can make the multilateral health architecture more resilient to future crises. For this, we also need cooperation with China, which is not the first time it has been the source of a pandemic.
The COVID-19 pandemic and the measures taken against it triggered a dramatic slump in the global economy and showed us how far our interdependence with China has advanced. But asymmetric dependencies in systemically important areas also make us vulnerable, as the supply shortages of medical goods at the start of the pandemic showed. However, we will continue to reject calls for decoupling from China, as this would benefit no one and certainly not our export industry. What is needed instead is a partial re-coupling that reduces one-sided dependencies, for example, by further diversifying our relations in Asia, as envisaged in the German Federal Government’s Indo-Pacific guidelines. Interdependencies are not a bad thing per se either, because mutual dependencies promote cooperation. In view of China’s economic successes, however, we should demand a level playing field and stricter reciprocity in our trade relations, especially in the EU-China investment agreement.
The COVID crisis is acting as a catalyst in the systemic conflict with China. The Chinese economy is already humming again and is becoming – as it did after the economic crisis after 2008 – the engine of global recovery. The successes are fuelling the debate about the advantages and disadvantages of the Western system of a democratic constitutional state with a social market economy versus the Chinese surveillance dictatorship with a controlled state economy. The illusionless view of China’s development also shows that hopes for political liberalization in the country and integration into a liberal world order will not be fulfilled in the foreseeable future. On the contrary, the Chinese leadership is becoming increasingly repressive internally and aggressive externally, as demonstrated by the massive human rights violations against the Uyghurs in Xinjiang, the far-reaching encroachment on Hong Kong’s autonomy, and the threatening military gestures against Taiwan.
It is clear to us that we can only successfully defend our values and interests against China together with our European and transatlantic partners. We must therefore prevent China from driving a wedge between us by “bilateralizing” relations. What we need is a common robust China policy. Firmly anchored in the Western community of security and values, this is our foundation for a political dialogue with Beijing on an equal footing. Germany and the EU should therefore seize the opportunity that, in Joe Biden, we once again have a convinced democrat at our side and closely coordinate our China policy with him.
Thanks to the COVID-19 vaccines, there is light at the end of the tunnel in the crisis. Unfortunately, we lack a similarly effective means of containing autocratic tendencies in the world. But here, too, the resilience of our own system – the health of our democracy – is crucial. So instead of China’s containment, we need first and foremost to strengthen democracy – at home and around the world. That’s why we should actively support the “Summit for Democracy” that President Biden has announced – so that the torch of democracy will soon shine brightly again.
