China is one of the largest export markets for German SMEs. This makes the concern about the rise of competition from the Far East all the greater. “We still give our technology a foster parent treatment,” says the managing director of SME Groups Germany, Ludwig Veltmann, in an interview with China.Table. Marcel Grzanna spoke with him about China’s ambitions for tech leadership.
Medium-sized companies should not sell their technical know-how lightly to competitors from the People’s Republic, says Veltmann. The German economy must become stronger in digitalization and data analysis. In the globalization race, Veltmann advocates a united Europe and globally defined environmental and social standards. However, he remains critical of the Supply Chain Act.
Competition between China and Germany is also the subject of Frank Sieren’s analysis of EV prices. This issue is currently hitting a nerve in Germany: electric vehicles are too expensive. This was one of the statements in the truel for the chancellorship. A nurse can’t afford an EV, so a ban on combustion cars is anti-social. China proves the opposite. Here, average prices for electric cars have dropped by almost 50 percent in the last ten years – while they have risen in Europe and the USA. The billions in subsidies made available by the central government are also a reason for this. The expansion plans of the Chinese competition could now hit European manufacturers on the wrong foot.
In the chaotic final days of the Trump presidency, US General Mark Milley called a senior Chinese military officer, General Li Zuocheng. His message: Don’t worry about a surprise US attack – I’d give you a heads-up. Milley wanted to prevent an accidental war between the superpowers. Who is the general to whom the Milley call was directed? Finn Mayer-Kuckuk has been looking for clues: General Li is a member of the CCP Central Committee and, as one of the most important military officers, enjoys the trust of President Xi – and a high international reputation.
Have a pleasant week!
Disclaimer: This interview has been translated into English and is not considered an official translation by any party involved.
Mr. Veltmann, what would German SMEs prefer: a world under the USA or Chinese technological leadership?
We prefer the Americans as long as they don’t have a president like Trump. They are much closer to us culturally and also have a similar understanding of democracy. China is an autocracy. And a country that is organized in an authoritarian manner is fundamentally suspect to us.
What consequences would Chinese technology leadership have for Germany?
There are two levels to this. On the one hand, the depth of value creation in Germany would decrease. In some technology sectors, German companies already no longer play a role. China is not even stopping at technologies in which German industry still plays a leading role. When China sells aircraft on the global market, for example, where Airbus and Boeing still set the tone today, it becomes clear how value creation is migrating to China.
And the second level?
These are the political implications. It is about the question of how we want to live. In Germany, we are very proud of our democracy and our way of life, and see our form of government as superior also in terms of growth and development prospects. But now a country comes along that is run autocratically and gives us a run for our money with its state capitalism. This could cause one or two tech enthusiasts to doubt our democracy. Voices might arise calling for a “strong man” in Germany, someone who will use the sometimes lagging procedures in democratic bodies as an excuse to restrict liberties. That worries me.
Do you think it’s a real scenario that we become a dictatorship because of China’s economic success?
To the extent that our companies despair due to bureaucracy and lengthy processes, we are creating the breeding ground for such thinking. Every now and then, I hear from companies how uncomplicated and quick projects are implemented in China. Our companies, on the other hand, are always queuing for approval, whether for this or that and in the process they constantly have to pay hefty administrative fees, even though companies pay plenty of taxes. This overall situation generates a lot of frustration.
Are German SMEs at risk of becoming China’s supplicants?
We already are to a certain degree. China is isolating itself off more and more and is conspicuously working towards far-reaching self-sufficiency in many areas of its economy. More and more German companies knocking on the door of potential Chinese business partners are encountering problems. The harassment that foreigners experience when entering the country during the Corona period is symptomatic. Moreover, people are no longer allowed to speak openly about matters critical to the system. When it comes to sensitive matters, the Chinese side immediately forbids any discussion.
Would all this be different if the US won the race for technological dominance?
That’s my assumption. Apart from the greater compatibility of our political system with that of the US, China has formulated a clear strategy. Namely, it is working to end dependence on foreign supplies. Technology leadership would massively help China become self-sufficient. It would become much less attractive as an export market for German companies.
Does the middle class have no means to prevent imminent Chinese tech supremacy?
More flexibility can increase the inventiveness and commitment of small and medium-sized enterprises. But politics must lay the groundwork for it. It is always easy to praise the SME sector as the foundation of the German economy and to announce its support in Sunday sermons. And on Monday, things become more difficult again. Instead of flexibility, there are building permits, lengthy approval and inspection processes, and restrictions that impair small and medium-sized businesses. The imposed extension of the recording of working hours, for example, is absolutely out of place nowadays and unnecessarily hinders businesses in their competition.
Is local politics at fault that China does not allow a level playing field, which in turn grants huge advantages to Chinese companies?
Politics is not doing what it should be doing. It could forge strong alliances in the EU. As Europeans, we can’t counter the Chinese without such alliances. We don’t even have an EU foreign minister. Every nation in the EU has to deal with China on its own, which naturally plays into the hands of such a large country. That’s why we absolutely need a stronger Europe.
By banning the Chinese from bidding on an eye for an eye basis?
No, this won’t happen just by playing “tit-for-tat.” Global cooperation with clear rules through the World Trade Organization or similar institutions is needed. Multilateral understandings are a better lever than bilateralism when it comes to dealing with China. Given China’s size and market power, it is essential to stand united to effectively defend one’s interests against the Chinese Government.
You criticize politics. But could the SME sector also have prepared better for the challenges it faces as a result of China’s rise?
In the mid-1980s, I conducted a research project on cooperation in Taiwan. At that time, it was completely absurd to think that the People’s Republic of China would gain a significant weight in the world. Incidentally, I was not the only one to assume that Taiwan, on the contrary, would be better able to hold its own in international competition due to its clear economic superiority over the People’s Republic at the time. And we did not have much confidence in a communist regime in this respect.
In recent years, however, the People’s Republic of China has proven the opposite – despite its autocratic socialist form of governance. China has long since ceased to be the world’s workbench for cheap products and imitations of Western brands. Instead, capital and know-how have flowed into the country in huge doses, shifting the balance. Today, there is hardly any technology in which China does not have the claim or the ambition to be the world leader. SMEs should have recognized these intentions early on and not carelessly sold top technical know-how to China.
It’s too late for that, but are we at least doing enough to protect our technology now?
We are still giving it foster care treatment. I don’t want to talk about protectionism, but if a Chinese company acquires a German company to find out how it all works and then continues to operate the business in China for the Chinese market, then it must be clear to us that we will end up left in the cold all too quickly. We need to be wiser about this.
After all these years, are there still companies that are unaware of the profound changes brought about by China’s pivotal role?
China’s ambitious goals are now present in some form in almost every company. But there are still too few strategic plans to counter what is happening a few thousand kilometers away.
China’s categorical rejection of any responsibility for the Covid pandemic, the breaches of contract in Hong Kong, the tragedies in Xinjiang: Are German SMEs in any way beginning to reflect on whether it is morally decent to do business with China?
Of course it has. And there are many companies that are drawing conclusions from this. After all, SMEs generally agree with a policy that says: we pay attention to human rights and production conditions in this country. But in the end, it is not realistic to demand for companies to take on a kind of control function and bear sole responsibility whenever international policy fails to find solutions. Individual SME will hardly be able to keep track of increasingly complex supply chains and assume sole responsibility for the behavior of upstream suppliers or the actions of their governments.
Is this human or do we need to demand more from companies?
This raises the question of how far an individual entrepreneur can be held responsible. After all, the Supply Chain Due Diligence Act requires that the supply chain consists only of actors with a clean record. But with the way the world works, with its division of labor, this is not feasible at all. It would be important for environmental and social standards to be set by the global community. The WTO, for example, should take care of this. Then companies could work much more efficiently and would not be held back by costly bureaucratic monsters.
What tools are left for SMEs beyond political demands?
If we manage to unleash creativity and innovation and create or further develop strong brands, then we will continue to have the best opportunities in international competition. Then we can position ourselves as an indispensable player in global value chains. The image of German products is still very good in China. But we have to be aware that this is also declining. The diesel scandal has also put German cars under pressure in China, of course also because Chinese propaganda has used this to its advantage.
Not to mention the degree of digitalization.
And here, too, we have to ask ourselves why we are at risk of falling behind and, unfortunately, already have so in many areas. Digitization requires major investment, but mobilizing this investment at the necessary pace in Germany is often simply not possible to the same extent as in the US or China, for example. The overdue transformation process can only succeed if digital tools and, above all, digitally collected and processed data are used in a targeted manner. For retailers, for example, it is important to precisely know customer needs. The company that succeeds best in doing this is the one that is ahead of the competition. Today, economic success is mostly data-based. We are still lagging far behind in data evaluation. If you take a closer look at the variety and benefits of the services on the Alibaba trading platform, for example, it becomes clear where the competitive path is heading.
That sounds like a lot of work in a difficult starting position. How do you assess the mood in the SME sector?
SMEs are professional optimists with considerable flexibility and adaptability. This not only strengthens their companies and protects them, especially in times of crisis, but also stabilizes entire national economies. Digitization and the rapidly intensifying debate on sustainability are triggering dramatic changes in the markets, which individual SMEs are less and less able to cope with. The idea of cooperation is therefore experiencing a renaissance because only combined forces can compensate for the disadvantages of too minor units.
To this end, SME Groups Germany consistently presents its expertise for strengthening and further developing companies on the basis of a cooperative idea to the 230,000 companies represented in 320 business associations from 45 trade, craft, and service sectors. In this context, it is important to repeatedly demonstrate to political decision-makers the value of a cooperative economic system and to advocate for its freedom – for example in antitrust and competition policy. Being well networked as an entrepreneur is not only increasingly proving to be an economic advantage, it also contributes to a better atmosphere.
Ludwig Veltmann, 62, learned Chinese in the 1980s and moved to Taiwan and the People’s Republic for various research projects. Since 2001, he has been monitoring the growing influence of the People’s Republic on the German economy in his capacity as Chief Executive of SME Groups Germany.
General Li Zuocheng 李作成 (68) had actually only gone public with one relatively harmless activity in the whole of 2021. In March, he took a spade and watering can to a tree-planting activity near Beijing. He planted pine trees, magnolias, and begonias as part of the government’s gigantic greening program (China.Table reported).
Whenever people like Li roll up their uniform sleeves and get their hands dirty for a campaign like this, it’s important for propaganda. For, Li is one of the most powerful men in China. He is the highest-ranking general and a member of the Party’s Military Commission – the controlling body of the People’s Liberation Army. It does not report to the government, but to the CCP – a typically Chinese peculiarity. This makes the party’s Military Commission the real center of power in China. If nothing else worked, then at least the army is still capable of acting.
Normally, only one member of the military commission is reasonably well known in the West: Xi Jinping. Li Zuocheng, however, has now become downright famous in America. His US colleague Mark Milley had called him in the chaotic last days of the Trump administration, according to the new book “Peril” by journalists Bob Woodward and Robert Costa, which will be published on Tuesday.
US Military leaders were worried that Donald Trump might start a war with China as a distraction from his election defeat. Milley contacted his peer General Li to prevent any misunderstanding. “General Li, you and I have known each other for now five years,” the book quotes him as saying. “If we’re going to attack, I’m going to call you ahead of time.” That was on October 30, 2020.
US Republicans now consider Milley a traitor. After all, he made the call behind the back of Trump, who was commander-in-chief. But friends of the general came to his defense, saying he routinely kept in touch with friend and foe. In fact, maintaining such contacts is also part of Li’s job. He also maintains relations with Russia, for example, to coordinate the military activities of both nations.
So Milley knew exactly why he was calling Li in particular. The Chinese top military officer is considered level-headed, and he is very well-connected with current leadership: he is a loyal communist from Xi Jinping’s camp. Li was born in 1953 in the early days of the People’s Republic. He became a soldier at 17 and joined the Communist Party at 19. He fought in the Sino-Vietnamese War in 1979 and received medals for bravery. A short time later, he was promoted to division commander.
In 1997, 44 years old Li was promoted to two-star general. After that, his career stagnated until Xi somewhat surprisingly elevated him to the top of the military hierarchy. He made Li a four-star general and inaugural commander in quick succession. With that, he also advanced to the military commission. In addition to all this, he has also been a member of the Party’s Central Committee since 2017. This makes him one of the 205 men and women who control China’s destiny.
Li clearly enjoys Xi’s trust. Other key generals had simply disappeared from the scene during the head of state’s military makeover in 2017. Presumably, they could not convincingly prove their loyalty. Among those who disappeared was Fang Fenghui, who was never heard from again after a brief investigation. Xi reduced the size of the military commission from eleven to seven members during this period and appointed Li to the exclusive panel. Li is said to have been critical of former President Jiang Zemin, which hurt his career under the latter but benefited it under Xi. This was reported by Apple Daily at the time (no link possible because the publication has been discontinued).
So when it comes to avoiding misunderstandings in a tense geopolitical situation, Li is the general of the hour. Two years ago, he was the Japanese’ preferred candidate to participate in talks to de-escalate a dispute over Pacific islands.
Milley and Li have also been in regular contact over recent years. Joint appearances by the two men were often accompanied by conciliatory language. Typical is the promise of “productive dialogue” aimed at building a “constructive and results-oriented relationship”.
But his well-established international contacts do not make Li a harmless liberal. He will “take all necessary steps to resolutely smash any separatist plots or actions,” he is quoted as saying. A strive for independence by the island poses a “great and realistic threat” to peace along the Taiwan Strait, he said. Li is, of course, fulfilling his military role here.
But Milley and Li have known each other since 2016 and obviously had a good personal connection. The two even look somewhat similar visually as they walk next to their respective troops in their uniforms. In the US government crisis of 2020, Li was then the first point of contact for the concerned US military, as Woodward and Costa tell in their book.
Milley approaching Li with the delicate matter of an alleged crazed commander-in-chief was a real vote of confidence. It’s a good thing these contacts exist. After all, a US war against China, accidental or otherwise, would be the ultimate disaster.
China is one of the largest export markets for German SMEs. This makes the concern about the rise of competition from the Far East all the greater. “We still give our technology a foster parent treatment,” says the managing director of SME Groups Germany, Ludwig Veltmann, in an interview with China.Table. Marcel Grzanna spoke with him about China’s ambitions for tech leadership.
Medium-sized companies should not sell their technical know-how lightly to competitors from the People’s Republic, says Veltmann. The German economy must become stronger in digitalization and data analysis. In the globalization race, Veltmann advocates a united Europe and globally defined environmental and social standards. However, he remains critical of the Supply Chain Act.
Competition between China and Germany is also the subject of Frank Sieren’s analysis of EV prices. This issue is currently hitting a nerve in Germany: electric vehicles are too expensive. This was one of the statements in the truel for the chancellorship. A nurse can’t afford an EV, so a ban on combustion cars is anti-social. China proves the opposite. Here, average prices for electric cars have dropped by almost 50 percent in the last ten years – while they have risen in Europe and the USA. The billions in subsidies made available by the central government are also a reason for this. The expansion plans of the Chinese competition could now hit European manufacturers on the wrong foot.
In the chaotic final days of the Trump presidency, US General Mark Milley called a senior Chinese military officer, General Li Zuocheng. His message: Don’t worry about a surprise US attack – I’d give you a heads-up. Milley wanted to prevent an accidental war between the superpowers. Who is the general to whom the Milley call was directed? Finn Mayer-Kuckuk has been looking for clues: General Li is a member of the CCP Central Committee and, as one of the most important military officers, enjoys the trust of President Xi – and a high international reputation.
Have a pleasant week!
Disclaimer: This interview has been translated into English and is not considered an official translation by any party involved.
Mr. Veltmann, what would German SMEs prefer: a world under the USA or Chinese technological leadership?
We prefer the Americans as long as they don’t have a president like Trump. They are much closer to us culturally and also have a similar understanding of democracy. China is an autocracy. And a country that is organized in an authoritarian manner is fundamentally suspect to us.
What consequences would Chinese technology leadership have for Germany?
There are two levels to this. On the one hand, the depth of value creation in Germany would decrease. In some technology sectors, German companies already no longer play a role. China is not even stopping at technologies in which German industry still plays a leading role. When China sells aircraft on the global market, for example, where Airbus and Boeing still set the tone today, it becomes clear how value creation is migrating to China.
And the second level?
These are the political implications. It is about the question of how we want to live. In Germany, we are very proud of our democracy and our way of life, and see our form of government as superior also in terms of growth and development prospects. But now a country comes along that is run autocratically and gives us a run for our money with its state capitalism. This could cause one or two tech enthusiasts to doubt our democracy. Voices might arise calling for a “strong man” in Germany, someone who will use the sometimes lagging procedures in democratic bodies as an excuse to restrict liberties. That worries me.
Do you think it’s a real scenario that we become a dictatorship because of China’s economic success?
To the extent that our companies despair due to bureaucracy and lengthy processes, we are creating the breeding ground for such thinking. Every now and then, I hear from companies how uncomplicated and quick projects are implemented in China. Our companies, on the other hand, are always queuing for approval, whether for this or that and in the process they constantly have to pay hefty administrative fees, even though companies pay plenty of taxes. This overall situation generates a lot of frustration.
Are German SMEs at risk of becoming China’s supplicants?
We already are to a certain degree. China is isolating itself off more and more and is conspicuously working towards far-reaching self-sufficiency in many areas of its economy. More and more German companies knocking on the door of potential Chinese business partners are encountering problems. The harassment that foreigners experience when entering the country during the Corona period is symptomatic. Moreover, people are no longer allowed to speak openly about matters critical to the system. When it comes to sensitive matters, the Chinese side immediately forbids any discussion.
Would all this be different if the US won the race for technological dominance?
That’s my assumption. Apart from the greater compatibility of our political system with that of the US, China has formulated a clear strategy. Namely, it is working to end dependence on foreign supplies. Technology leadership would massively help China become self-sufficient. It would become much less attractive as an export market for German companies.
Does the middle class have no means to prevent imminent Chinese tech supremacy?
More flexibility can increase the inventiveness and commitment of small and medium-sized enterprises. But politics must lay the groundwork for it. It is always easy to praise the SME sector as the foundation of the German economy and to announce its support in Sunday sermons. And on Monday, things become more difficult again. Instead of flexibility, there are building permits, lengthy approval and inspection processes, and restrictions that impair small and medium-sized businesses. The imposed extension of the recording of working hours, for example, is absolutely out of place nowadays and unnecessarily hinders businesses in their competition.
Is local politics at fault that China does not allow a level playing field, which in turn grants huge advantages to Chinese companies?
Politics is not doing what it should be doing. It could forge strong alliances in the EU. As Europeans, we can’t counter the Chinese without such alliances. We don’t even have an EU foreign minister. Every nation in the EU has to deal with China on its own, which naturally plays into the hands of such a large country. That’s why we absolutely need a stronger Europe.
By banning the Chinese from bidding on an eye for an eye basis?
No, this won’t happen just by playing “tit-for-tat.” Global cooperation with clear rules through the World Trade Organization or similar institutions is needed. Multilateral understandings are a better lever than bilateralism when it comes to dealing with China. Given China’s size and market power, it is essential to stand united to effectively defend one’s interests against the Chinese Government.
You criticize politics. But could the SME sector also have prepared better for the challenges it faces as a result of China’s rise?
In the mid-1980s, I conducted a research project on cooperation in Taiwan. At that time, it was completely absurd to think that the People’s Republic of China would gain a significant weight in the world. Incidentally, I was not the only one to assume that Taiwan, on the contrary, would be better able to hold its own in international competition due to its clear economic superiority over the People’s Republic at the time. And we did not have much confidence in a communist regime in this respect.
In recent years, however, the People’s Republic of China has proven the opposite – despite its autocratic socialist form of governance. China has long since ceased to be the world’s workbench for cheap products and imitations of Western brands. Instead, capital and know-how have flowed into the country in huge doses, shifting the balance. Today, there is hardly any technology in which China does not have the claim or the ambition to be the world leader. SMEs should have recognized these intentions early on and not carelessly sold top technical know-how to China.
It’s too late for that, but are we at least doing enough to protect our technology now?
We are still giving it foster care treatment. I don’t want to talk about protectionism, but if a Chinese company acquires a German company to find out how it all works and then continues to operate the business in China for the Chinese market, then it must be clear to us that we will end up left in the cold all too quickly. We need to be wiser about this.
After all these years, are there still companies that are unaware of the profound changes brought about by China’s pivotal role?
China’s ambitious goals are now present in some form in almost every company. But there are still too few strategic plans to counter what is happening a few thousand kilometers away.
China’s categorical rejection of any responsibility for the Covid pandemic, the breaches of contract in Hong Kong, the tragedies in Xinjiang: Are German SMEs in any way beginning to reflect on whether it is morally decent to do business with China?
Of course it has. And there are many companies that are drawing conclusions from this. After all, SMEs generally agree with a policy that says: we pay attention to human rights and production conditions in this country. But in the end, it is not realistic to demand for companies to take on a kind of control function and bear sole responsibility whenever international policy fails to find solutions. Individual SME will hardly be able to keep track of increasingly complex supply chains and assume sole responsibility for the behavior of upstream suppliers or the actions of their governments.
Is this human or do we need to demand more from companies?
This raises the question of how far an individual entrepreneur can be held responsible. After all, the Supply Chain Due Diligence Act requires that the supply chain consists only of actors with a clean record. But with the way the world works, with its division of labor, this is not feasible at all. It would be important for environmental and social standards to be set by the global community. The WTO, for example, should take care of this. Then companies could work much more efficiently and would not be held back by costly bureaucratic monsters.
What tools are left for SMEs beyond political demands?
If we manage to unleash creativity and innovation and create or further develop strong brands, then we will continue to have the best opportunities in international competition. Then we can position ourselves as an indispensable player in global value chains. The image of German products is still very good in China. But we have to be aware that this is also declining. The diesel scandal has also put German cars under pressure in China, of course also because Chinese propaganda has used this to its advantage.
Not to mention the degree of digitalization.
And here, too, we have to ask ourselves why we are at risk of falling behind and, unfortunately, already have so in many areas. Digitization requires major investment, but mobilizing this investment at the necessary pace in Germany is often simply not possible to the same extent as in the US or China, for example. The overdue transformation process can only succeed if digital tools and, above all, digitally collected and processed data are used in a targeted manner. For retailers, for example, it is important to precisely know customer needs. The company that succeeds best in doing this is the one that is ahead of the competition. Today, economic success is mostly data-based. We are still lagging far behind in data evaluation. If you take a closer look at the variety and benefits of the services on the Alibaba trading platform, for example, it becomes clear where the competitive path is heading.
That sounds like a lot of work in a difficult starting position. How do you assess the mood in the SME sector?
SMEs are professional optimists with considerable flexibility and adaptability. This not only strengthens their companies and protects them, especially in times of crisis, but also stabilizes entire national economies. Digitization and the rapidly intensifying debate on sustainability are triggering dramatic changes in the markets, which individual SMEs are less and less able to cope with. The idea of cooperation is therefore experiencing a renaissance because only combined forces can compensate for the disadvantages of too minor units.
To this end, SME Groups Germany consistently presents its expertise for strengthening and further developing companies on the basis of a cooperative idea to the 230,000 companies represented in 320 business associations from 45 trade, craft, and service sectors. In this context, it is important to repeatedly demonstrate to political decision-makers the value of a cooperative economic system and to advocate for its freedom – for example in antitrust and competition policy. Being well networked as an entrepreneur is not only increasingly proving to be an economic advantage, it also contributes to a better atmosphere.
Ludwig Veltmann, 62, learned Chinese in the 1980s and moved to Taiwan and the People’s Republic for various research projects. Since 2001, he has been monitoring the growing influence of the People’s Republic on the German economy in his capacity as Chief Executive of SME Groups Germany.
General Li Zuocheng 李作成 (68) had actually only gone public with one relatively harmless activity in the whole of 2021. In March, he took a spade and watering can to a tree-planting activity near Beijing. He planted pine trees, magnolias, and begonias as part of the government’s gigantic greening program (China.Table reported).
Whenever people like Li roll up their uniform sleeves and get their hands dirty for a campaign like this, it’s important for propaganda. For, Li is one of the most powerful men in China. He is the highest-ranking general and a member of the Party’s Military Commission – the controlling body of the People’s Liberation Army. It does not report to the government, but to the CCP – a typically Chinese peculiarity. This makes the party’s Military Commission the real center of power in China. If nothing else worked, then at least the army is still capable of acting.
Normally, only one member of the military commission is reasonably well known in the West: Xi Jinping. Li Zuocheng, however, has now become downright famous in America. His US colleague Mark Milley had called him in the chaotic last days of the Trump administration, according to the new book “Peril” by journalists Bob Woodward and Robert Costa, which will be published on Tuesday.
US Military leaders were worried that Donald Trump might start a war with China as a distraction from his election defeat. Milley contacted his peer General Li to prevent any misunderstanding. “General Li, you and I have known each other for now five years,” the book quotes him as saying. “If we’re going to attack, I’m going to call you ahead of time.” That was on October 30, 2020.
US Republicans now consider Milley a traitor. After all, he made the call behind the back of Trump, who was commander-in-chief. But friends of the general came to his defense, saying he routinely kept in touch with friend and foe. In fact, maintaining such contacts is also part of Li’s job. He also maintains relations with Russia, for example, to coordinate the military activities of both nations.
So Milley knew exactly why he was calling Li in particular. The Chinese top military officer is considered level-headed, and he is very well-connected with current leadership: he is a loyal communist from Xi Jinping’s camp. Li was born in 1953 in the early days of the People’s Republic. He became a soldier at 17 and joined the Communist Party at 19. He fought in the Sino-Vietnamese War in 1979 and received medals for bravery. A short time later, he was promoted to division commander.
In 1997, 44 years old Li was promoted to two-star general. After that, his career stagnated until Xi somewhat surprisingly elevated him to the top of the military hierarchy. He made Li a four-star general and inaugural commander in quick succession. With that, he also advanced to the military commission. In addition to all this, he has also been a member of the Party’s Central Committee since 2017. This makes him one of the 205 men and women who control China’s destiny.
Li clearly enjoys Xi’s trust. Other key generals had simply disappeared from the scene during the head of state’s military makeover in 2017. Presumably, they could not convincingly prove their loyalty. Among those who disappeared was Fang Fenghui, who was never heard from again after a brief investigation. Xi reduced the size of the military commission from eleven to seven members during this period and appointed Li to the exclusive panel. Li is said to have been critical of former President Jiang Zemin, which hurt his career under the latter but benefited it under Xi. This was reported by Apple Daily at the time (no link possible because the publication has been discontinued).
So when it comes to avoiding misunderstandings in a tense geopolitical situation, Li is the general of the hour. Two years ago, he was the Japanese’ preferred candidate to participate in talks to de-escalate a dispute over Pacific islands.
Milley and Li have also been in regular contact over recent years. Joint appearances by the two men were often accompanied by conciliatory language. Typical is the promise of “productive dialogue” aimed at building a “constructive and results-oriented relationship”.
But his well-established international contacts do not make Li a harmless liberal. He will “take all necessary steps to resolutely smash any separatist plots or actions,” he is quoted as saying. A strive for independence by the island poses a “great and realistic threat” to peace along the Taiwan Strait, he said. Li is, of course, fulfilling his military role here.
But Milley and Li have known each other since 2016 and obviously had a good personal connection. The two even look somewhat similar visually as they walk next to their respective troops in their uniforms. In the US government crisis of 2020, Li was then the first point of contact for the concerned US military, as Woodward and Costa tell in their book.
Milley approaching Li with the delicate matter of an alleged crazed commander-in-chief was a real vote of confidence. It’s a good thing these contacts exist. After all, a US war against China, accidental or otherwise, would be the ultimate disaster.
