After Christmas and before the turn of the year, we find ourselves “between the years”. It’s a good time to reflect and assess all changes that happened over the year. In today’s interview with Finn Mayer-Kuckuk, Klaus Muehlhahn looks back on relations with China in 2021, highlighting, in particular, the new approach to trade policy. China is beginning to use supply chains as a political instrument. In China’s foreign economic policy, in particular, Xi Jinping’s mark is beginning to show more and more. China’s president is a clever strategist, says Muehlhahn, but also a very ambitious man of power. With this in mind, the sinologist sees the new year with concern. Muehlhahn warns of an “epistemic challenge“. What he exactly means by that – and how we should approach it – is the topic of today’s interview.
There is no such thing as “between the years” in China. Christmas is only celebrated in shopping malls, and the new year doesn’t start until the beginning of February. But don’t worry, the news section keeps you up to date on Huawei’s car plans, the dispute between Lithuania and China as well as Japan’s decision not to attend the Olympics.
Last but not least, I would like to draw your attention to our profile for today. It is about Ma Xingrui, who has been appointed the new party leader for Xinjiang. It is a decision that could reach far beyond the province in northwestern China: For those who prove themselves in Xinjiang have the chance to rise far up the national leadership.
The case of Continental is currently stirring things up. For the first time, China is attacking the automotive industry of its partner nation Germany. What does that tell us?
Indeed, a new approach to trade policy is beginning to emerge here. China is now also starting to use supply chains as a political tool. Goods with preliminary products from Lithuania are to be labeled as such and are subsequently banned from sale in China. This political instrumentalization of supply chains was first used by Donald Trump on a large scale. What is new now, however, is that China is taking up this practice. China also wants to use its economic weight politically.
It also looks as if the behavior of both sides is becoming less predictable.
In any case, this is a major risk for the future and especially for the year 2022. States and institutions have long played by unwritten and written rules that have dominated interaction in the world over the past three decades. In this regard, China has even been a relatively reliable actor. This era is now ending. These rules no longer apply. As a result, predictability is dwindling. But no one knows what the new rules will look like. Thus, the risk of unintended side effects increases, both for China’s economy and the global economy.
Actors behave increasingly unpredictably.
This also begins to show in the events surrounding Lithuania. China has become more irritable. At the same time, the country is now more willing to take risks. Lithuania is a beautiful country – I don’t mean to downplay that – but it is also a very small country. China’s strong reaction is out of all proportion to Lithuania’s political weight. If China had not reacted at all, the potential damage to all sides would have been minimal. China has reacted with surprising irritation to a secondary issue.
Why didn’t big China just ignore the actions of little Lithuania?
In the past, China would probably have reacted like this. It would have officially presented the affair as unimportant and tried to isolate Lithuania behind the scenes. But now, it is going public with it, which is having the opposite effect: it is becoming a European and German affair.
Why this escalation?
Xi Jinping’s mark as president is beginning to show clearer in China’s foreign economic policy. We see very few other decision-makers at all. That was definitely different in the past; there were numerous foreign policymakers who collectively shaped policy. I do believe that the current course has a lot to do with the fact that Xi has defined foreign policy as a focus for himself. He wants to impress in this regard by showing off China’s strength and confidence.
This begs the question of why a skilled strategist like Xi pursues such an unsubtle foreign policy.
Xi Jinping is indeed a very clever strategist. But he is also very ambitious. We see a clear departure from the past in foreign policy. Under his predecessors, there was a consensus to act cautiously internationally. There was never really a clear word. Now China has become downright belligerent in comparison. This also sends a message to the masses. Xi now presents his China especially confident.
So the message is going inward?
What is often overlooked from the outside are the major challenges the leadership is facing. There is a kind of crisis awareness there, in my opinion. In the coming year, 1.2 million graduates will enter the job market for whom there are no actual employment opportunities. Foreign policy posturing can be used to conceal these internal problems. The rhetoric of national grandeur is quite deliberate.
Nationalism is also inextricably mixed with the cult of personality around Xi. Is he installing himself as an autocrat?
We see at least a clear consolidation within the party. Many courses were set at the 6th plenum. The resolution on the history of the party was less about the past than it was about the future. But what is even more important than the actual content of the resolution is how it came about. Only the strongest leaders could push something like this through. In China, too, the resolution is the result of a lengthy discussion full of risks. The resulting consensus is remarkable. Almost no other voices are heard from China.
Do the other voices no longer exist? Have the other opinions already fallen silent or do we just not hear them?
We are facing what I would call the “epistemic challenge”. That is, the question of what we can still know about the country at all, given its isolation, and how we acquire that knowledge. No matter where we look, all we read now are the official statements from China. Our China analysis is then based on this. The bottom line is that all we do is read tea leaves with a very limited number of documents. Imagine, for instance, that you, as a journalist in the German capital, were to analyze German politics based solely on party programs and official press releases.
The result would be pretty poor indeed.
And yet that is exactly what we are doing with China. If we are honest, we commentators have to admit: This is a black box, and we don’t really know what is happening inside. After all, we can’t go there anymore.
The end of face-to-face interactions was perhaps one of the most drastic changes of the past two years. Can actors still make any informed decisions at all when dealing with China?
Accurate information is very important for risk assessment. And now we are basically doing this on very limited data. Together, we face the challenge of developing new access and sources of information.
The new German government also has to deal with this problem. There are hardly any channels for exploring what is and what is not possible with China in the run-up to a decision.
This increases the risk that measures will not have the desired effect. This could potentially be problematic for a federal government that has yet to adopt a clear position on China. The various ministries must now quickly coordinate with the business community and form a strategy. But I believe this will take time. This risk now is that the German will slip up and make a mistake due to its inexperience.
This also increases the risk of fatal miscalculations.
As a historian, today’s situation reminds me more and more of the situation before the First World War. We have the same confusion, the same dominance of national interests. We have the same willingness to use trade as a weapon, reducing commonalities and emphasizing differences. We need a focus on what we have in common, despite all the mutual criticism. It is only right that values should play a role in the relationship with China. But we also need to weigh up all our goals realistically. In the end, what is needed is pragmatism and a focus on actual success rather than a rhetoric one.
What can we do to open up more channels of communication again?
In any case, it will be imperative to resume dialogue and activate previously unused contacts. Here, for example, representatives of Chinese business or science can also be approached. We should have this dialog much more often, and we don’t really do that at all anymore. As I said, we are in a crisis of information gathering. We need to find out much more about what is happening on the Chinese side.
What can we learn about what’s happening within the party? 2022, for example, brings us one of the party congresses that take place only every five years.
This will be the most important party congress in a very long time. A large part of the leadership, even below the Politburo, will probably be replaced. The last time something like this happened was in the 1980s. The reformist generation is leaving. Afterward, we will see even greater control by Xi Jinping. And, of course, the official de-limitation of his term. This will bring him even more to the center of attention. The diversity within the party will become less and less visible.
We are seeing the end of Deng Xiaoping’s political system, which provided for collective rule with elements of mutual supervision. Does the party continue to go along with this deconstruction?
It is going along with it. But the risks for Xi Jinping are also increasing. After all, what is good for him is not necessarily good for the party. Collective leadership and building consensus has been the secret of the party’s success. Term limits were an important element here. This long balancing and seeking common ground behind closed doors that used to define Chinese politics is more or less gone. This raises the question: Will the party remain successful in the future? Or will this system devolve into a private regime with all its risks?
What hurts China, however, also hurts Germany these days.
While the tone is becoming more aggressive, the world is becoming more interconnected. Young Chinese remain very interested in the world, in travel, in mutual interaction, in Western music, in movies. It can seriously harm the system if access to the world is limited. Even if very little leaks to the outside world, it’s pretty clear that not everyone is thrilled.
Klaus Muehlhahn is Professor of Chinese Studies at Freie Universität Berlin and, since June 2020, President of Zeppelin University in Friedrichshafen for the next five years. He has a background in social sciences and history. In 2021, his publications included “The Chinese Communist Party: A Century in Ten Lives” and “Geschichte des modernen China: Von der Qing-Dynastie bis zur Gegenwart.” (History of Modern China: From the Qing Dynasty to the Present) In 2022, Muelhahn and Julia Haes plan to publish the book “Hongkong: Umkämpfte Metropole von 1841 bis heute.” (Hong Kong: Contested Metropolis from 1841 to the Present).
Chinese car manufacturers will be authorized to be one hundred percent owned by foreign companies in the future. A new version of the negative list in question will come into effect on January 1, 2022, the National Development and Reform Commission announced on Monday. These changes were already decided on and announced with the changes to the 2020 negative list.
China has steadily reduced its restrictions on foreign investment in recent years. Nevertheless, the list still specifies 31 industries in which international companies are not allowed to invest, or only to a limited extent. These include rare minerals as well as media and movie industries (China.Table reported). fin
Huawei unveiled the Aito M5, a hybrid SUV by its partner Seres, just before Christmas. It will be equipped with the group’s Harmony OS universal operating system. The car is expected to be available from February and is integrated into the Huawei ecosystem. It can be opened and started with the company’s smartwatch.
Huawei asserts that it does not plan to manufacture cars. But in practice, the company is moving on the borderline of entering the vehicle business. Many observers have considered the presentation of the new model as a Huawei product launch, after all, it took place between presentations of wristwatches, digital glasses, and its smartphones. However, Huawei wants to become a service provider and supplier for EV manufacturers and is using the partnership with Seres as a test run.
The M5 is the first car of the Aito (傲图) brand. Seres is a subsidiary of the car company Sokon from Chongqing (China.Table reported). The Aito M5 is expected to cost around €34,000. As a plug-in hybrid, it uses its eclectic engine for shorter distances, but can also switch on a combustion engine to extend its range. The German importer of Seres is the company Indimo (China.Table reported) fin
Daimler wants to reduce its share in the Chinese EV manufacturer Denza from 50 to 10 percent. In return, the Chinese partner BYD will hold 90 percent of the joint venture in the future. This was announced by Daimler on Friday. The transaction is expected to be completed by March 2022.
In 2012, Daimler and BYD founded a joint venture to develop and produce EVs for the Chinese market. This was the group’s response to pressure from the Chinese government, which was pushing for the establishment of electric car startups. Both partners funded Denza at 50 percent. But demand for Denza cars has been modest since its founding and launch (2014). Just 23,000 Denza models are said to have been sold.
Daimler CEO Ola Kaellenius had already announced earlier that Daimler’s strategy would focus primarily on luxury cars that generate high margins. For example, Daimler had contributed the Smart brand to a joint venture with Geely Holding in China and sold the French Smart plant to Ineos Group.
The mid-range car Denza thus no longer fits Daimler’s concept. Nevertheless, Daimler does not want to break completely with BYD. The Chinese company is one of the world’s largest battery manufacturers for EVs and a supplier to Mercedes. niw
The trade dispute between Lithuania and China could have consequences for German subsidiaries operating in the EU state. The German-Baltic Chamber of Commerce has warned the Lithuanian government that plants in Lithuania will be forced to close down if relations with China don’t improve. This was reported by the Lithuanian news platform 15min. If no “constructive solution to restore Lithuanian-Chinese economic relations” is found, consequences for the local German economy are imminent. The letter was sent to Foreign Minister Gabrielius Landsbergis and Minister of Economy Aušrinė Armonaitė.
The continuation of investment projects already on the way is said to be at risk if required components from China were no longer available, the platform quotes the Chamber of Commerce letter. “As a result, the base business model of our companies is at risk and some will have no choice but to stop doing business in Lithuania,” the heads of the chambers of commerce warned. Financial aid or financial compensation would also not restore supply chain disruptions or exports to China.
The People’s Republic has been blocking the import of Lithuanian goods for almost a month. They are no longer being processed by customs. Other EU states are also affected if products contain parts from Lithuania. German auto supplier Continental is also facing problems as a result (China.Table reported). Beijing continues to deny all allegations. The allegations that Lithuanian shipments were not cleared, and import requests rejected, were simply not true, Chinese Foreign Ministry spokesman Lijian Zhao said last week. “If companies face technical problems in exporting certain products to China, they can report to competent Chinese authorities through normal channels,” Zhao said. ari
Japan does not intend to send any government members to the Winter Olympics in Beijing. Japan’s government spokesman Hirokazu Matsuno believes “that it’s important for China to ensure freedom, respect for basic human rights and the rule of law, which are universal values of the international community”. However, Matsuno deliberately did not use the term “diplomatic boycott”. Politician and athlete Seiko Hashimoto, head of the Tokyo 2020 Olympics organizing committee, will travel to Beijing. Japanese media comment that these compromises were made in an attempt not to offend China too much. However, it remains to be seen if China will see this as a friendly gesture.
Beijing had repeatedly called for Japan’s support for the Winter Games. China has shown solidarity with Japan’s Summer Games and offered help after the Tokyo Games were postponed from 2020 to 2021 due to the pandemic, the Chinese state newspaper Global Times commented.
In early December, the US announced that it would not send any government representatives to the Winter Games due to numerous human rights violations by the Chinese government (China.Table reported). The UK, Canada, Australia, New Zealand, Belgium, and Lithuania also joined the diplomatic boycott of the USA. The EU countries, including Germany, have not yet taken a unified stance on a boycott of the Winter Games (China.Table reported). The Games in Beijing will take place from February 4 to 20. niw
Canada’s Prime Minister Justin Trudeau has called on Western countries to form a united front against China. In an interview on Canadian television, Trudeau said China must be confronted with a united front in the future. According to Trudeau, the People’s Republic has played Western states off against each other several times in the past as they vied against each other for greater access to the Chinese market.
“We compete with each other. We’re trying to see how could we get better access for Canadian beef than Australian beef to this country or that market,” Trudeau said. He calls for a change in the future because China is cleverly exploiting such competition. “We need to do a better job of working together and standing strong so that China can’t, you know, play the angles and divide us one against the other,” Trudeau added. To this end, Canada’s prime minister is proposing a “united front” of Western states to resist China’s increasing “coercive diplomacy”.
Canada’s relationship with China has been strained for the past three years. It began with the dispute over Meng Wanzhou, the chief financial officer of the Huawei Group. She had been detained in Canada for almost three years because US courts had demanded her extradition. A few weeks ago, Wanzhou was finally released after a special deal was reached with US justice authorities. In return, two Canadians detained in China were released (China.Table reported).
Most recently, Canada has joined a diplomatic boycott of the Beijing Winter Olympics. Like the US, the UK and other countries, Canada will not send senior politicians to the Games. Europe and also Germany have not yet found a unified position. (China.Table reported). rad
Chinese authorities had reported 162 new Covid cases in one day at the beginning of the week. It is the highest number of new local infections recorded in a single day this year. 150 infections alone were reported in the metropolis of Xi’an.
In Xi’an, several new cases had already become known in the past week, whereupon the authorities imposed extensive curfews for its 13 million residents: Thus, people in Xi’an are now only allowed to leave their homes in emergencies. Each family can designate one member to go shopping every two days. The population was also fully tested for the virus several times.
China is pursuing a strict zero-covid strategy: With rigid measures such as those now again in Xi’an, the virus has so far largely been brought under control. However, there have been several outbreaks since autumn. Now those responsible fear the far more infectious Omicron variant. No Omicron cases have yet been registered in the current outbreak in Xi’an. The authorities do not want to move away from zero-covid until there are almost no more deaths from Covid. To achieve this, they are relying on the development of new types of drugs. Chinese companies are already researching at full speed (China.Table reported).
The airline industry has again been massively affected by the Covid pandemic: Over the Christmas holidays, more than 7,000 flights have been canceled or grounded worldwide. According to the website Flightaware.com, more than 2,000 flights were cancelled on Sunday alone, and there were also more than 4,000 delays. According to the airlines, numerous flights had to be canceled because many employees are infected with the coronavirus or are under quarantine.
Chinese airlines accounted for most of the cancellations, with China Eastern cancelling 1,000 flights on Friday and Saturday, more than a fifth of its schedule. Air China also put about 20 percent of its scheduled departures on hold during that period. rad
The CCP just doesn’t appoint anyone to the top posts in the Xinjiang Autonomous Region. Xinjiang is the highest sensitive administrative province, even before Tibet. Those who prove themselves there have a chance to rise to the top of the national leadership.
That is why two personnel decisions are currently causing a stir. Chen Quanguo (66) is leaving his post as General Secretary of the CP in Xinjiang. He will be succeeded by Ma Xingrui (62), who was previously governor of the southern province of Guangdong.
After his posts in Tibet and Xinjiang, Chen now receives a position in the Politburo. Soon, he will no longer spend his time in Urumqi, but in Beijing. In the eyes of his party colleagues, he has done an excellent job in Tibet and Xinjiang. For example, he has driven up economic growth and fought poverty. This is an important component of the propaganda campaign that portrays the government’s work in Xinjiang as a blessing for the people.
What enrages human rights groups is also considered a complete success: The creation of a seamless surveillance regime that ensures political tranquility. This has brought Chen sanctions by the US and the EU (China.Table reported). This in turn had led to counter-sanctions, which in turn brought about the temporary end of the CAI investment agreement. Chen has thus become a person of world-historical relevance.
Ma Xingrui is now expected to just as vigorously continue the program of economic promotion and political-cultural repression. If he succeeds, he can expect a top role at the national level. The assignment in the deep west of the country is a test of his political skills. He will have to demonstrate qualities that he has barely needed in his career so far.
There are hardly any regions in China with such different conditions as Guangdong and Xinjiang. Guangdong: One of the world’s strongest economies, China’s gateway to the world, and repeatedly a laboratory for experiments with freedom and liberalization. Xinjiang: remote, deliberately isolated, and China’s laboratory for experiments with total surveillance.
The new party secretary cannot afford to show any weakness. This is probably the test the leadership is putting him to: Ma has already been successful as a technocrat; in Xinjiang, he must now show that he can also be cruel. After all, so far in his career, he has mainly dealt with factual issues. To climb even further up the career ladder, he must rigorously enforce the line laid down by Beijing against the indigenous Uyghur people.
Ma hails from the northern province of Heilongjiang. He is a professor of aerospace engineering and has spent much of his career in science administration. In the 1990s, he led Harbin Institute of Technology as Vice-Dean. That was his stepping stone to a role as chairman of the Chinese Academy of Space Technology (CAST). In 2013, he led China’s first Chang’e 3 lunar mission and successfully landed the first Jade Rabbit. At the same time, he became the head of China’s Atomic Energy Administration. Shortly after, he became one of the vice-ministers of industry and information technology.
At this point, Ma had gone from being a scientist to one of the most important apparatchiks. He moved up to the CP Central Committee and has been a member of the innermost circle ever since. Thus began the gradual shift of his duties from technical organization to political leadership positions. His stint as Party Secretary of the startup city of Shenzhen marks a transitional position. From there, he became the first governor of Guangdong who was not from the province and does not speak Cantonese.
While the Christian world was celebrating Christmas, the leading cadres in the Xinjiang Autonomous Region held a meeting. Right after, they announced the “readjustment of the leadership positions of central organs”. According to the wording of the Xinhua report, Ma’s appointment as Party Secretary is effective immediately.
His role is also particularly sensitive because another Xinjiang law is about to take effect in the US. US President Joe Biden signed it the day before Christmas Eve. Under the law, US companies must prove that imports from Xinjiang were not manufactured under forced labor. Xinjiang occupies a key position in numerous supply chains (China.Table reported). However, due to a lack of traffic to the area, it is hard to tell which products Uyghurs are forced to work on.
The US chip manufacturer Intel has now also been caught up in the debate. It found itself in a typical predicament in which other Western and Japanese companies also regularly find themselves. The semiconductor specialist had initially demanded that its suppliers refrain from sourcing goods from Xinjiang. This drew criticism from Beijing – followed by an apology for hurting Chinese feelings. The pop star Wang Junkai also had to cancel his advertising contract with Intel. This shows that Intel can’t please both the US and China.
But regardless of Beijing’s defiant line, the pressure on China’s treatment of its Uyghurs is growing, and this will also significantly impact Ma’s work. Chinese government officials and propaganda insist that the human rights violations in Xinjiang are mere lies from the West. Forced labor, they say, is not taking place. Ma’s job now may involve working on the image of the province to alleviate pressure following the harsh repression and internment of millions of Uyghurs. Presumably, this does not lead to more freedom for the Uyghur population. Ma must therefore square the circle. Finn Mayer-Kuckuk
Jonathan D. Spence, the renowned sinologist, has passed away at the age of 85. Spence was a history professor at Yale University until 2008. His best-selling book “The Search for Modern China” was published in 1990. Spence was considered one of the most distinguished experts on modern Chinese history, from the Opium War to modern times.
Ao Hong is the new chairman of China Rare Earth Group. The newly founded company combines three state-owned producers that mine the precious industrial metals. The merger is intended to bundle domestic production of rare minerals and make their extraction more efficient. Ao was previously director of state-owned metals group Chinalco. The State-owned Assets Supervision and Administration Commission (SASAC) merged Chinalco, China Minmetals and Ganzhou Rare Earth Group. China is considered a world leader in the production of the sought-after elements and controls up to 90 percent of the rare earth processing sector.
Also on duty at Christmas: Ye Guangfu leaves the Chinese space module Tianhe just before 7 PM on December 26 to carry out an external mission. One of the taikonaut’s tasks is to install a panoramic camera. While nothing is known about the Christmas tree, Elon Musk received a rather unusual Christmas present on Monday: snide comments from Chinese Internet users. China’s space station apparently had to dodge a satellite from Musk’s Starlink program twice in order to avoid a collision.
After Christmas and before the turn of the year, we find ourselves “between the years”. It’s a good time to reflect and assess all changes that happened over the year. In today’s interview with Finn Mayer-Kuckuk, Klaus Muehlhahn looks back on relations with China in 2021, highlighting, in particular, the new approach to trade policy. China is beginning to use supply chains as a political instrument. In China’s foreign economic policy, in particular, Xi Jinping’s mark is beginning to show more and more. China’s president is a clever strategist, says Muehlhahn, but also a very ambitious man of power. With this in mind, the sinologist sees the new year with concern. Muehlhahn warns of an “epistemic challenge“. What he exactly means by that – and how we should approach it – is the topic of today’s interview.
There is no such thing as “between the years” in China. Christmas is only celebrated in shopping malls, and the new year doesn’t start until the beginning of February. But don’t worry, the news section keeps you up to date on Huawei’s car plans, the dispute between Lithuania and China as well as Japan’s decision not to attend the Olympics.
Last but not least, I would like to draw your attention to our profile for today. It is about Ma Xingrui, who has been appointed the new party leader for Xinjiang. It is a decision that could reach far beyond the province in northwestern China: For those who prove themselves in Xinjiang have the chance to rise far up the national leadership.
The case of Continental is currently stirring things up. For the first time, China is attacking the automotive industry of its partner nation Germany. What does that tell us?
Indeed, a new approach to trade policy is beginning to emerge here. China is now also starting to use supply chains as a political tool. Goods with preliminary products from Lithuania are to be labeled as such and are subsequently banned from sale in China. This political instrumentalization of supply chains was first used by Donald Trump on a large scale. What is new now, however, is that China is taking up this practice. China also wants to use its economic weight politically.
It also looks as if the behavior of both sides is becoming less predictable.
In any case, this is a major risk for the future and especially for the year 2022. States and institutions have long played by unwritten and written rules that have dominated interaction in the world over the past three decades. In this regard, China has even been a relatively reliable actor. This era is now ending. These rules no longer apply. As a result, predictability is dwindling. But no one knows what the new rules will look like. Thus, the risk of unintended side effects increases, both for China’s economy and the global economy.
Actors behave increasingly unpredictably.
This also begins to show in the events surrounding Lithuania. China has become more irritable. At the same time, the country is now more willing to take risks. Lithuania is a beautiful country – I don’t mean to downplay that – but it is also a very small country. China’s strong reaction is out of all proportion to Lithuania’s political weight. If China had not reacted at all, the potential damage to all sides would have been minimal. China has reacted with surprising irritation to a secondary issue.
Why didn’t big China just ignore the actions of little Lithuania?
In the past, China would probably have reacted like this. It would have officially presented the affair as unimportant and tried to isolate Lithuania behind the scenes. But now, it is going public with it, which is having the opposite effect: it is becoming a European and German affair.
Why this escalation?
Xi Jinping’s mark as president is beginning to show clearer in China’s foreign economic policy. We see very few other decision-makers at all. That was definitely different in the past; there were numerous foreign policymakers who collectively shaped policy. I do believe that the current course has a lot to do with the fact that Xi has defined foreign policy as a focus for himself. He wants to impress in this regard by showing off China’s strength and confidence.
This begs the question of why a skilled strategist like Xi pursues such an unsubtle foreign policy.
Xi Jinping is indeed a very clever strategist. But he is also very ambitious. We see a clear departure from the past in foreign policy. Under his predecessors, there was a consensus to act cautiously internationally. There was never really a clear word. Now China has become downright belligerent in comparison. This also sends a message to the masses. Xi now presents his China especially confident.
So the message is going inward?
What is often overlooked from the outside are the major challenges the leadership is facing. There is a kind of crisis awareness there, in my opinion. In the coming year, 1.2 million graduates will enter the job market for whom there are no actual employment opportunities. Foreign policy posturing can be used to conceal these internal problems. The rhetoric of national grandeur is quite deliberate.
Nationalism is also inextricably mixed with the cult of personality around Xi. Is he installing himself as an autocrat?
We see at least a clear consolidation within the party. Many courses were set at the 6th plenum. The resolution on the history of the party was less about the past than it was about the future. But what is even more important than the actual content of the resolution is how it came about. Only the strongest leaders could push something like this through. In China, too, the resolution is the result of a lengthy discussion full of risks. The resulting consensus is remarkable. Almost no other voices are heard from China.
Do the other voices no longer exist? Have the other opinions already fallen silent or do we just not hear them?
We are facing what I would call the “epistemic challenge”. That is, the question of what we can still know about the country at all, given its isolation, and how we acquire that knowledge. No matter where we look, all we read now are the official statements from China. Our China analysis is then based on this. The bottom line is that all we do is read tea leaves with a very limited number of documents. Imagine, for instance, that you, as a journalist in the German capital, were to analyze German politics based solely on party programs and official press releases.
The result would be pretty poor indeed.
And yet that is exactly what we are doing with China. If we are honest, we commentators have to admit: This is a black box, and we don’t really know what is happening inside. After all, we can’t go there anymore.
The end of face-to-face interactions was perhaps one of the most drastic changes of the past two years. Can actors still make any informed decisions at all when dealing with China?
Accurate information is very important for risk assessment. And now we are basically doing this on very limited data. Together, we face the challenge of developing new access and sources of information.
The new German government also has to deal with this problem. There are hardly any channels for exploring what is and what is not possible with China in the run-up to a decision.
This increases the risk that measures will not have the desired effect. This could potentially be problematic for a federal government that has yet to adopt a clear position on China. The various ministries must now quickly coordinate with the business community and form a strategy. But I believe this will take time. This risk now is that the German will slip up and make a mistake due to its inexperience.
This also increases the risk of fatal miscalculations.
As a historian, today’s situation reminds me more and more of the situation before the First World War. We have the same confusion, the same dominance of national interests. We have the same willingness to use trade as a weapon, reducing commonalities and emphasizing differences. We need a focus on what we have in common, despite all the mutual criticism. It is only right that values should play a role in the relationship with China. But we also need to weigh up all our goals realistically. In the end, what is needed is pragmatism and a focus on actual success rather than a rhetoric one.
What can we do to open up more channels of communication again?
In any case, it will be imperative to resume dialogue and activate previously unused contacts. Here, for example, representatives of Chinese business or science can also be approached. We should have this dialog much more often, and we don’t really do that at all anymore. As I said, we are in a crisis of information gathering. We need to find out much more about what is happening on the Chinese side.
What can we learn about what’s happening within the party? 2022, for example, brings us one of the party congresses that take place only every five years.
This will be the most important party congress in a very long time. A large part of the leadership, even below the Politburo, will probably be replaced. The last time something like this happened was in the 1980s. The reformist generation is leaving. Afterward, we will see even greater control by Xi Jinping. And, of course, the official de-limitation of his term. This will bring him even more to the center of attention. The diversity within the party will become less and less visible.
We are seeing the end of Deng Xiaoping’s political system, which provided for collective rule with elements of mutual supervision. Does the party continue to go along with this deconstruction?
It is going along with it. But the risks for Xi Jinping are also increasing. After all, what is good for him is not necessarily good for the party. Collective leadership and building consensus has been the secret of the party’s success. Term limits were an important element here. This long balancing and seeking common ground behind closed doors that used to define Chinese politics is more or less gone. This raises the question: Will the party remain successful in the future? Or will this system devolve into a private regime with all its risks?
What hurts China, however, also hurts Germany these days.
While the tone is becoming more aggressive, the world is becoming more interconnected. Young Chinese remain very interested in the world, in travel, in mutual interaction, in Western music, in movies. It can seriously harm the system if access to the world is limited. Even if very little leaks to the outside world, it’s pretty clear that not everyone is thrilled.
Klaus Muehlhahn is Professor of Chinese Studies at Freie Universität Berlin and, since June 2020, President of Zeppelin University in Friedrichshafen for the next five years. He has a background in social sciences and history. In 2021, his publications included “The Chinese Communist Party: A Century in Ten Lives” and “Geschichte des modernen China: Von der Qing-Dynastie bis zur Gegenwart.” (History of Modern China: From the Qing Dynasty to the Present) In 2022, Muelhahn and Julia Haes plan to publish the book “Hongkong: Umkämpfte Metropole von 1841 bis heute.” (Hong Kong: Contested Metropolis from 1841 to the Present).
Chinese car manufacturers will be authorized to be one hundred percent owned by foreign companies in the future. A new version of the negative list in question will come into effect on January 1, 2022, the National Development and Reform Commission announced on Monday. These changes were already decided on and announced with the changes to the 2020 negative list.
China has steadily reduced its restrictions on foreign investment in recent years. Nevertheless, the list still specifies 31 industries in which international companies are not allowed to invest, or only to a limited extent. These include rare minerals as well as media and movie industries (China.Table reported). fin
Huawei unveiled the Aito M5, a hybrid SUV by its partner Seres, just before Christmas. It will be equipped with the group’s Harmony OS universal operating system. The car is expected to be available from February and is integrated into the Huawei ecosystem. It can be opened and started with the company’s smartwatch.
Huawei asserts that it does not plan to manufacture cars. But in practice, the company is moving on the borderline of entering the vehicle business. Many observers have considered the presentation of the new model as a Huawei product launch, after all, it took place between presentations of wristwatches, digital glasses, and its smartphones. However, Huawei wants to become a service provider and supplier for EV manufacturers and is using the partnership with Seres as a test run.
The M5 is the first car of the Aito (傲图) brand. Seres is a subsidiary of the car company Sokon from Chongqing (China.Table reported). The Aito M5 is expected to cost around €34,000. As a plug-in hybrid, it uses its eclectic engine for shorter distances, but can also switch on a combustion engine to extend its range. The German importer of Seres is the company Indimo (China.Table reported) fin
Daimler wants to reduce its share in the Chinese EV manufacturer Denza from 50 to 10 percent. In return, the Chinese partner BYD will hold 90 percent of the joint venture in the future. This was announced by Daimler on Friday. The transaction is expected to be completed by March 2022.
In 2012, Daimler and BYD founded a joint venture to develop and produce EVs for the Chinese market. This was the group’s response to pressure from the Chinese government, which was pushing for the establishment of electric car startups. Both partners funded Denza at 50 percent. But demand for Denza cars has been modest since its founding and launch (2014). Just 23,000 Denza models are said to have been sold.
Daimler CEO Ola Kaellenius had already announced earlier that Daimler’s strategy would focus primarily on luxury cars that generate high margins. For example, Daimler had contributed the Smart brand to a joint venture with Geely Holding in China and sold the French Smart plant to Ineos Group.
The mid-range car Denza thus no longer fits Daimler’s concept. Nevertheless, Daimler does not want to break completely with BYD. The Chinese company is one of the world’s largest battery manufacturers for EVs and a supplier to Mercedes. niw
The trade dispute between Lithuania and China could have consequences for German subsidiaries operating in the EU state. The German-Baltic Chamber of Commerce has warned the Lithuanian government that plants in Lithuania will be forced to close down if relations with China don’t improve. This was reported by the Lithuanian news platform 15min. If no “constructive solution to restore Lithuanian-Chinese economic relations” is found, consequences for the local German economy are imminent. The letter was sent to Foreign Minister Gabrielius Landsbergis and Minister of Economy Aušrinė Armonaitė.
The continuation of investment projects already on the way is said to be at risk if required components from China were no longer available, the platform quotes the Chamber of Commerce letter. “As a result, the base business model of our companies is at risk and some will have no choice but to stop doing business in Lithuania,” the heads of the chambers of commerce warned. Financial aid or financial compensation would also not restore supply chain disruptions or exports to China.
The People’s Republic has been blocking the import of Lithuanian goods for almost a month. They are no longer being processed by customs. Other EU states are also affected if products contain parts from Lithuania. German auto supplier Continental is also facing problems as a result (China.Table reported). Beijing continues to deny all allegations. The allegations that Lithuanian shipments were not cleared, and import requests rejected, were simply not true, Chinese Foreign Ministry spokesman Lijian Zhao said last week. “If companies face technical problems in exporting certain products to China, they can report to competent Chinese authorities through normal channels,” Zhao said. ari
Japan does not intend to send any government members to the Winter Olympics in Beijing. Japan’s government spokesman Hirokazu Matsuno believes “that it’s important for China to ensure freedom, respect for basic human rights and the rule of law, which are universal values of the international community”. However, Matsuno deliberately did not use the term “diplomatic boycott”. Politician and athlete Seiko Hashimoto, head of the Tokyo 2020 Olympics organizing committee, will travel to Beijing. Japanese media comment that these compromises were made in an attempt not to offend China too much. However, it remains to be seen if China will see this as a friendly gesture.
Beijing had repeatedly called for Japan’s support for the Winter Games. China has shown solidarity with Japan’s Summer Games and offered help after the Tokyo Games were postponed from 2020 to 2021 due to the pandemic, the Chinese state newspaper Global Times commented.
In early December, the US announced that it would not send any government representatives to the Winter Games due to numerous human rights violations by the Chinese government (China.Table reported). The UK, Canada, Australia, New Zealand, Belgium, and Lithuania also joined the diplomatic boycott of the USA. The EU countries, including Germany, have not yet taken a unified stance on a boycott of the Winter Games (China.Table reported). The Games in Beijing will take place from February 4 to 20. niw
Canada’s Prime Minister Justin Trudeau has called on Western countries to form a united front against China. In an interview on Canadian television, Trudeau said China must be confronted with a united front in the future. According to Trudeau, the People’s Republic has played Western states off against each other several times in the past as they vied against each other for greater access to the Chinese market.
“We compete with each other. We’re trying to see how could we get better access for Canadian beef than Australian beef to this country or that market,” Trudeau said. He calls for a change in the future because China is cleverly exploiting such competition. “We need to do a better job of working together and standing strong so that China can’t, you know, play the angles and divide us one against the other,” Trudeau added. To this end, Canada’s prime minister is proposing a “united front” of Western states to resist China’s increasing “coercive diplomacy”.
Canada’s relationship with China has been strained for the past three years. It began with the dispute over Meng Wanzhou, the chief financial officer of the Huawei Group. She had been detained in Canada for almost three years because US courts had demanded her extradition. A few weeks ago, Wanzhou was finally released after a special deal was reached with US justice authorities. In return, two Canadians detained in China were released (China.Table reported).
Most recently, Canada has joined a diplomatic boycott of the Beijing Winter Olympics. Like the US, the UK and other countries, Canada will not send senior politicians to the Games. Europe and also Germany have not yet found a unified position. (China.Table reported). rad
Chinese authorities had reported 162 new Covid cases in one day at the beginning of the week. It is the highest number of new local infections recorded in a single day this year. 150 infections alone were reported in the metropolis of Xi’an.
In Xi’an, several new cases had already become known in the past week, whereupon the authorities imposed extensive curfews for its 13 million residents: Thus, people in Xi’an are now only allowed to leave their homes in emergencies. Each family can designate one member to go shopping every two days. The population was also fully tested for the virus several times.
China is pursuing a strict zero-covid strategy: With rigid measures such as those now again in Xi’an, the virus has so far largely been brought under control. However, there have been several outbreaks since autumn. Now those responsible fear the far more infectious Omicron variant. No Omicron cases have yet been registered in the current outbreak in Xi’an. The authorities do not want to move away from zero-covid until there are almost no more deaths from Covid. To achieve this, they are relying on the development of new types of drugs. Chinese companies are already researching at full speed (China.Table reported).
The airline industry has again been massively affected by the Covid pandemic: Over the Christmas holidays, more than 7,000 flights have been canceled or grounded worldwide. According to the website Flightaware.com, more than 2,000 flights were cancelled on Sunday alone, and there were also more than 4,000 delays. According to the airlines, numerous flights had to be canceled because many employees are infected with the coronavirus or are under quarantine.
Chinese airlines accounted for most of the cancellations, with China Eastern cancelling 1,000 flights on Friday and Saturday, more than a fifth of its schedule. Air China also put about 20 percent of its scheduled departures on hold during that period. rad
The CCP just doesn’t appoint anyone to the top posts in the Xinjiang Autonomous Region. Xinjiang is the highest sensitive administrative province, even before Tibet. Those who prove themselves there have a chance to rise to the top of the national leadership.
That is why two personnel decisions are currently causing a stir. Chen Quanguo (66) is leaving his post as General Secretary of the CP in Xinjiang. He will be succeeded by Ma Xingrui (62), who was previously governor of the southern province of Guangdong.
After his posts in Tibet and Xinjiang, Chen now receives a position in the Politburo. Soon, he will no longer spend his time in Urumqi, but in Beijing. In the eyes of his party colleagues, he has done an excellent job in Tibet and Xinjiang. For example, he has driven up economic growth and fought poverty. This is an important component of the propaganda campaign that portrays the government’s work in Xinjiang as a blessing for the people.
What enrages human rights groups is also considered a complete success: The creation of a seamless surveillance regime that ensures political tranquility. This has brought Chen sanctions by the US and the EU (China.Table reported). This in turn had led to counter-sanctions, which in turn brought about the temporary end of the CAI investment agreement. Chen has thus become a person of world-historical relevance.
Ma Xingrui is now expected to just as vigorously continue the program of economic promotion and political-cultural repression. If he succeeds, he can expect a top role at the national level. The assignment in the deep west of the country is a test of his political skills. He will have to demonstrate qualities that he has barely needed in his career so far.
There are hardly any regions in China with such different conditions as Guangdong and Xinjiang. Guangdong: One of the world’s strongest economies, China’s gateway to the world, and repeatedly a laboratory for experiments with freedom and liberalization. Xinjiang: remote, deliberately isolated, and China’s laboratory for experiments with total surveillance.
The new party secretary cannot afford to show any weakness. This is probably the test the leadership is putting him to: Ma has already been successful as a technocrat; in Xinjiang, he must now show that he can also be cruel. After all, so far in his career, he has mainly dealt with factual issues. To climb even further up the career ladder, he must rigorously enforce the line laid down by Beijing against the indigenous Uyghur people.
Ma hails from the northern province of Heilongjiang. He is a professor of aerospace engineering and has spent much of his career in science administration. In the 1990s, he led Harbin Institute of Technology as Vice-Dean. That was his stepping stone to a role as chairman of the Chinese Academy of Space Technology (CAST). In 2013, he led China’s first Chang’e 3 lunar mission and successfully landed the first Jade Rabbit. At the same time, he became the head of China’s Atomic Energy Administration. Shortly after, he became one of the vice-ministers of industry and information technology.
At this point, Ma had gone from being a scientist to one of the most important apparatchiks. He moved up to the CP Central Committee and has been a member of the innermost circle ever since. Thus began the gradual shift of his duties from technical organization to political leadership positions. His stint as Party Secretary of the startup city of Shenzhen marks a transitional position. From there, he became the first governor of Guangdong who was not from the province and does not speak Cantonese.
While the Christian world was celebrating Christmas, the leading cadres in the Xinjiang Autonomous Region held a meeting. Right after, they announced the “readjustment of the leadership positions of central organs”. According to the wording of the Xinhua report, Ma’s appointment as Party Secretary is effective immediately.
His role is also particularly sensitive because another Xinjiang law is about to take effect in the US. US President Joe Biden signed it the day before Christmas Eve. Under the law, US companies must prove that imports from Xinjiang were not manufactured under forced labor. Xinjiang occupies a key position in numerous supply chains (China.Table reported). However, due to a lack of traffic to the area, it is hard to tell which products Uyghurs are forced to work on.
The US chip manufacturer Intel has now also been caught up in the debate. It found itself in a typical predicament in which other Western and Japanese companies also regularly find themselves. The semiconductor specialist had initially demanded that its suppliers refrain from sourcing goods from Xinjiang. This drew criticism from Beijing – followed by an apology for hurting Chinese feelings. The pop star Wang Junkai also had to cancel his advertising contract with Intel. This shows that Intel can’t please both the US and China.
But regardless of Beijing’s defiant line, the pressure on China’s treatment of its Uyghurs is growing, and this will also significantly impact Ma’s work. Chinese government officials and propaganda insist that the human rights violations in Xinjiang are mere lies from the West. Forced labor, they say, is not taking place. Ma’s job now may involve working on the image of the province to alleviate pressure following the harsh repression and internment of millions of Uyghurs. Presumably, this does not lead to more freedom for the Uyghur population. Ma must therefore square the circle. Finn Mayer-Kuckuk
Jonathan D. Spence, the renowned sinologist, has passed away at the age of 85. Spence was a history professor at Yale University until 2008. His best-selling book “The Search for Modern China” was published in 1990. Spence was considered one of the most distinguished experts on modern Chinese history, from the Opium War to modern times.
Ao Hong is the new chairman of China Rare Earth Group. The newly founded company combines three state-owned producers that mine the precious industrial metals. The merger is intended to bundle domestic production of rare minerals and make their extraction more efficient. Ao was previously director of state-owned metals group Chinalco. The State-owned Assets Supervision and Administration Commission (SASAC) merged Chinalco, China Minmetals and Ganzhou Rare Earth Group. China is considered a world leader in the production of the sought-after elements and controls up to 90 percent of the rare earth processing sector.
Also on duty at Christmas: Ye Guangfu leaves the Chinese space module Tianhe just before 7 PM on December 26 to carry out an external mission. One of the taikonaut’s tasks is to install a panoramic camera. While nothing is known about the Christmas tree, Elon Musk received a rather unusual Christmas present on Monday: snide comments from Chinese Internet users. China’s space station apparently had to dodge a satellite from Musk’s Starlink program twice in order to avoid a collision.