Table.Briefing: China

Change of population policy sparks outrage + Gene food experiments + Expensive decoupling

  • Scientists splice plants with human genes
  • IfW discussion on protectionism
  • Xiaomi grabs car software start-up
  • Volvo plans to buy truck manufacturer
  • Xpeng increases sales and losses
  • Trade dispute: Hopes for Huawei?
  • Government aims to boost economy
  • Johnny Erling: Retrospective anger over one-child policy
Dear reader,

Even China’s seasoned censors are having a hard time fighting the current outrage sparked by the introduction of the three-child policy, as Johnny Erling tells in his column. In countless comments, Internet users recalled decades of a cruel population policy – the one-child policy. Pregnant women expecting their second child were persecuted and illegally born babies branded as “black children.” But instead of critical reflection on the consequences of its policy, the CCP is now trying to encourage its population to have more children with pro-birth slogans.

Climate change is also a threat to vital farmlands through heat, droughts and torrential rain. Are genetically modified foods a way to maintain yields in the future? So far, Chinese authorities have been just as skeptical about the commercial application of genetic engineering in agriculture as their German counterparts. But skepticism could diminish as domestic companies gain more know-how, says Frank Sieren. A team of Chinese and American scientists has now managed to massively increase crop yields. The trick: the insertion of a human gene known to cause obesity. Bon appétit.

Have a pleasant weekend!

Your
Nico Beckert
Image of Nico  Beckert

Feature

Human genes for the super potato

A new genetic engineering technique could boost crop yields of rice and potatoes by up to 50 percent and make them more drought-resistant to boot. This was the result of a study conducted by Chinese and American scientists and published in July in the British journal Nature Biotechnology. Lead authors are Qiong Yu and Shun Liu of Beijing University.

The researchers have taken a new approach and introduced human genes into plants. In humans, these genes are associated with obesity. The so-called FTO gene is now even considered the “main switch” for obesity. But in plants, too, certain variants of the gene lead to an increase in mass. Apparently, the basic mechanisms of growth are similar in different organisms. This discovery may be used in the future to maintain a steady food supply despite climate change.

In any case, trials in China have shown that the insertion of human FTO genes into plants makes them grow significantly stronger. Root systems were also more developed than average within the series of trials. “We think this is a very good strategy to engineer our crops,” Jia Guifang, a chemical biologist at Beijing University, tells Smithsonian Magazine. But she acknowledges the need for further research before such plants can be marketed as products. The process cannot be allowed to pose any risks to consumers.

The procedure apparently works on almost all plant species, not just in rice and potatoes, but also in grass and trees. “The changes are actually dramatic,” explains He Chuan, professor at the University of Chicago and co-leader of the study. The science group has worked on it for more than a decade. Initially, it seemed like a crazy idea: “And to be honest, we expected disastrous results.” But to the scientists’ surprise, the human FTO sequence did not destroy or cripple the plants. Instead, it did only one thing: It made the plant grow, apparently without any limitations.

Their strategy is a highly unusual one, says Donald Ort, professor of biology at the University of Illinois and a member of the US National Academy of Sciences (NAS). The Smithsonian Magazine had asked him for an independent assessment: the Chinese team was poking in the dark and probably struck gold. “They were quite surprised.” Ort is one of the leading U.S. researchers in the field.

Hope for global nutrition

As part of the study, researchers at laboratories of Beijing University, Guizhou University and the University of Chicago conducted their experiments in both laboratories and fields around Beijing and in the province of Jiangxi. One of the results was that the yield of FTO rice plants more than tripled under laboratory conditions compared to unmodified specimens. The genetically modified plants had a 47 percent higher crop yield and over 40 percent higher weight. Similar trials with potato plants resulted in a 50 percent increase in yield.

Around nine million people die from starvation every year, more than from AIDS, malaria and tuberculosis combined. Worldwide, 690 million people suffered from hunger and food shortages last year – equivalent to around nine percent of the world’s population, 381 million in Asia alone. Climate change is increasing droughts around the globe, further reducing crop yields. In 2019, for example, southwest China’s Yunnan province was hit by a severe drought that damaged more than one million hectares of cropland and destroyed 16,667 hectares.

The science group is convinced that FTO plants could provide a remedy to this problem as well. According to the U.S.-China study, FTO-modified rice plants had significantly higher survival rates under two different categories of drought conditions. “This new technique offers the possibility of modifying plants to adapt to the ongoing global warming,” He says. “Perhaps we could grow grass that is able to withstand droughts in threatened areas.”

China views genetic engineering with suspicion

No other nation spends as much on state-funded plant research as China. Yet, the country still has very strict standards for the application of genetically modified plants and products. Commercial cultivation of plants carrying genes from other organisms is almost completely illegal in China. Exceptions are certain varieties of cotton, papaya, tomato and tobacco.

However, China’s reluctance is also due to the fact that the majority of promising GMO projects for human consumption have so far not come from domestic development. “It must be ruled out that foreign companies dominate the market for agrobiotechnology,” declared nation and party leader Xi Jinping at a conference of the Communist Party Central Committee five years ago.

In the field of green genetic engineering, direct investment is therefore prohibited for foreign corporations. However, joint ventures with Chinese companies are allowed if they are limited to conventional or hybrid breeding.

Currently, only the commercial cultivation of two GMOs is permitted in the EU: the corn “MON 810” and the potato “Amflora”. In Germany, no genetically modified plants have been commercially cultivated since 2012. After all, 80 percent of the German population has spoken out against cultivation. However, since even Germany is not able to meet the demand for protein-rich animal feed with GM-free feed alone, Germany and the EU import around 35 million tons of mostly genetically modified soybeans from North and South America every year.

Worldwide, five genetically modified crops, in particular, are currently cultivated: soybeans, corn, cotton, rapeseed and sugar beet. The largest producers are the USA, Argentina, Brazil and India. China only ranks fifth. However, these agricultural products may only be imported into the EU if they feature one of the currently 50 import licenses. According to current knowledge, genetically modified feed is considered harmless for milk, meat or eggs.

Could FTO plants jumpstart green genetic engineering?

The cooperation between the US and China in this field cannot be taken for granted. In the past, US negotiators have repeatedly urged China to ease restrictions on genetically modified crops. This would enable U.S. agricultural tech companies to sell their modified seeds and other GM products in China’s vast agricultural sector. China is home to 22 percent of the world’s population, but has only about eight percent of global arable land.

However, for the time being, Beijing seems to be unwilling to open up domestic cultivation of GM crops until Chinese companies are strong enough to keep up with global agri-tech giants, spearheaded by the US. China will further promote and regulate innovation, research and development, and application of genetically modified organisms, the Ministry of Agriculture and Rural Affairs announced this February.

As in other economic fields, emerging proprietary developments could thus change the leadership’s stance towards a product group. If successful, the market approval of FTO crops by Chinese agricultural companies would be a technological and economic milestone that Beijing is unlikely to ignore. In addition, laws on genetic engineering could change as a result.

In their next step, the scientists now want to achieve the same effect without foreign variants of FTO genes by changing the existing sequence in plant genomes. This at least eliminates the alarming aspect of introducing human genes into plants and eating them along with it.

  • Agriculture
  • Nutrition
  • Research
  • Science

“We knock on the Great Wall in vain”.

The event series on economic relations with China at the Kiel Institute for the World Economy (IfW) kicked off with a highly topical issue: the shift towards increased protectionism between major economic fields. The reasons for this are numerous. Prevention of supply bottlenecks, such as recently with protective masks or microchips, is currently at the top of the list and also gets a lot of public support. Other politicians are hoping for positive effects for the labor market in traditional sectors as more goods and parts are produced on the domestic market. Meanwhile, the CAI investment agreement with China has been caught up in political hostility between China and the EU. It was supposed to improve market access for both sides.

Jörg Wuttke, the long-time president of the EU Chamber of Commerce in China, provided a practical perspective on these issues. Economist and IfW head Gabriel Felbermayr contributed with his expert assessment based on scientific calculations.

Protectionism would be expensive

Felbermayr has already presented the results of his calculations in China.Table: By producing in the Far East and procuring parts from the People’s Republic, the German economy gains much more than it could stand to gain through greater independence. The advantages of isolation would first have to outweigh the gains for trade barriers to be sensible. However, spreading the economy across several parts of the world saves costs and creates efficiencies. In the end, all parties involved own more than before, according to Felbermayr.

The question of isolation or free trade is not even close to a tie, but very clear. According to simulations by the IfW, the disadvantages of economic isolation distinctly outweigh the advantages. Free trade is several times more beneficial than insisting on independence. Protectionism would reduce German economic output by up to 1.4 percent. Admittedly, a retreat to production within the EU creates somewhat more security in times of crisis. But overall, it will “cost an arm and a leg” in comparison, as Felbermayr puts it. Consumers will also end up with much less in their pocket, and their way of life will be damaged.

Wuttke changes his perspective once more and looks at the problem from China’s position. He refers to a joint study by the EU Chamber and Chinese Research Institute Merics, which examined the impacts of decoupling. Researchers conclude that China, for its part, has never fully opened up, to begin with. According to the study, China has only ever engaged in “selective coupling” where it suited economic planners. This applies to the early phase of economic relations up to the present day. Trouble was inevitable. Sooner or later, the West was bound to decline an economic relationship that mainly sees only one beneficiary.

China is more dependent on Europe than the other way round

China has thus systematically proceeded to protect its own industries and companies from foreign competition since the beginning of its supposed policy of opening-up. The opening of its market primarily affected sectors in which China wanted to gain know-how. Opening up only took place once its own economy was sufficiently developed. The EU and the US, on the other hand, opened their gates wide to Chinese imports right from the get-go, even though domestic companies suffered as a result.

This causes China’s isolation to be more painful for local companies than the incipient protectionism of the West. “We keep knocking on the Great Wall, but no one lets us in,” says Wuttke. China’s response to the crisis of interdependence is also now a focus on greater autarky. Greater independence from the outside is currently one of the planners’ declared goals. This is especially true in the tech sector.

However, this policy could also do more harm than good to China itself, Wuttke warned. “China is much more dependent on Europe than Europe is on China,” observes the president of the EU Chamber of Commerce. Most tech transfers to China stem from the EU, and European countries are huge buyers of Chinese goods.

Decoupling inhibits potential development

According to Wuttke’s observation, political priorities and the drive for independence are already hampering China’s potential. Since the opening at the end of the 1970s, China has made a transformation very similar to Japan and South Korea in their respective boom phases. But their common economic curves are already coming to an end, and China’s wealth progression is already dropping below that of its neighbors at the time.

Thus, according to the two experts, there is no need for the EU to raise tariffs or otherwise close the gates to goods from the Far East. Felbermayr also points out that the EU’s supposed dependence on China has not increased. The supply relationships of European companies are very evenly distributed. The USA remains an important partner.

The European Supply Chain Act appears to both Felbermayr and Wuttke as a possible obstacle to economic development in both regions. According to Felbermayr, it is an expression of a new form of protectionism. Wuttke, as a practitioner from the business world, sees enormous problems for the industry on the horizon.

Moreover, delivery stops not only occur in Asia, but in Europe as well. This is evident by the Covid crisis, which is seen as evidence for the need for decoupling. While it is true that in the first phase, production halts affected Chinese regions such as Wuhan. But in the end, China recovered much quicker than the EU and now is virtually free of Covid. This makes them all the more valuable as a sales market for ailing Western economies.

The next event in the series will take place on 30 September: Fair Competition and Subsidies – Europe’s Companies and China’s Competitive Pressure. Dietmar Baetge from the Technical University of Wildau and Jürgen Matthes from the Institute of the German Economy (IW) Cologne will discuss this topic.

  • Decoupling
  • EU
  • Geopolitics
  • IfW
  • Sanctions
  • Trade
  • USA

News

Xiaomi acquires autonomous driving start-up

Smartphone manufacturer Xiaomi has announced the acquisition of startup Deepmotion for $77 million. Deepmotion was founded four years ago and develops driver assistance software, Bloomberg reports. The purchase of Deepmotion is expected to aid Xiaomi’s developments in fully autonomous driving, according to Xiaomi executive Wang Xiang. The acquisition comes in tandem with Xiaomi’s expansion into the EV sector. The plan is to invest ten billion U.S. dollars in the field over the next decade. Xiaomi overtook US-company Apple as the second-largest smartphone maker for the first time during the second quarter of 2021. Net profit rose by 80 percent to the equivalent of nearly 1.1 billion euros. nib

  • autonomous driving
  • Car Industry
  • Xiaomi

Volvo about to acquire truck manufacturer

Volvo Trucks is about to purchase Chinese truck manufacturer JMC Heavy Duty Vehicle. The takeover for the equivalent of 123 million US dollars still has to be approved by Chinese authorities, as the business portal Caixin reports. Volvo, a subsidiary of Chinese manufacturer Geely, would gain full control of JMC Heavy Duty Vehicle through the acquisition and would not have to enter into a joint venture. In 2020, the Chinese government issued new rules to remove the joint venture requirement in the production of commercial vehicles. The Swedish-Chinese company would thus also take over a truck factory located in Taiyuan in northern China. According to Caixin, the plant will produce 15,000 trucks per year for the Chinese market starting by the end of 2022. Due to the logistics boom in China, many truck manufacturers are considering production facilities in the People’s Republic, according to the portal. nib

  • Car Industry
  • Logistics
  • Volvo

Xpeng with high losses

Chinese EV company Xpeng has reported mixed quarterly results. Xpeng had to register net losses of the equivalent of 184 million US dollars in the 2nd quarter – higher than previous forecasts. High expenses in research and development and marketing and sales were cited as the cause. However, Xpeng was able to increase sales and shipped just over 17,400 cars in the second quarter, more than planned, Bloomberg reports. Overall, the market for EV in China is growing strong once again. Nearly 1.5 million alternative-powered vehicles were sold in the first seven months of this year. More than in the entire previous year, according to data from the China Association of Automobile Manufacturers. nib

  • CAAM
  • Car Industry
  • Xpeng

Trade dispute: Is the ice melting around Huawei?

Networking specialist Huawei has apparently received permission in the US to order American-made car chips. The approval by President Joe Biden’s administration is seen as a sign that it could soften sanctions against the Chinese company. Specifically, the order is for semiconductor elements for sensors used in self-driving cars, the Chinese People’s Daily and Reuters news agency report in unison. Huawei is currently entering the vehicle business as a supplier(China.Table reported).

Biden’s predecessor had made the export of high technology to potentially dangerous companies from China subject to approval and then denied any approval. That amounted to an export ban on key components for Huawei and other Chinese tech companies. Because it is a licensing requirement, not a blanket ban, Biden can now readjust the policy without a new rule change. fin

  • Car Industry
  • Geopolitics
  • Huawei
  • Sanctions
  • Semiconductor
  • Trade
  • USA

Xi wants to boost economy

Head of state Xi Jinping is worried about the economic targets for the current year and hints at new economic stimulus measures. This is reported by news agency dpa citing an article in the party’s own “People’s Newspaper”. The central bank could loosen monetary policy again and give out fresh loans. New infrastructure projects are also being discussed. The background is a weaker economic recovery in the second Covid year. fin

  • Economy
  • Finance
  • Xi Jinping

Opinion

Three-child policy: China’s planners cut chives

By Johnny Erling
Ein Bild von Johnny Erling

China adopted a new ideal as a “birth-friendly nation.” To this end, Beijing has been searching online for propaganda rhetoric to make China’s households more palatable to the newly permitted child policy. The Internet community reacted differently than hoped – with an angry and derisive “shit storm”.

Once again, the Communist Party is asking China’s families to reinvent themselves. Everything that once applied and from which they suffered is to be forgotten practically overnight: 35 years of one-child policy with enforced birth control, surveillance, abortion, sterilization and harassment without end by a state even interfering in their bedrooms are to simply pass. Bearing children is once again the first civic duty, the Politburo decided on May 31. The party elite coined a new slogan: “Let’s be eager to create a birth-friendly society.” (努力构建 生育友好型社会).

The National People’s Congress (China’s socialist parliament) needed less than eight weeks to make 21 amendments to the People’s Republic’s Population and Family Planning Law, which has been in force since 2002. It was only in 2015 that the law was expanded to allow for the population to have two children. On Tuesday of last week, the Standing Committee of the National People’s Congress discussed the comprehensively revised new version. On Friday, after its first reading, it was already waved through and immediately put into effect.

The law allows for having three children, eliminates all penalties and fines for undeclared births, and promises families future government support. The adjustment extends from paid parental leave and more daycare facilities to birth-friendly adjustments to the financial, tax, insurance and educational systems, as well as to housing and employment. In the current five-year plan to 2025, the NDRC, the lead planning authority, plans to knock down the first pegs for China as a welcoming society; the age for marriage and for the birth of one’s first child is also to be lowered again. In 1990, Chinese married at an average age of 21.4. In 2017, they were 25.7 years old.

Search for pro-birth slogans

To drum up support, China’s Family Planning Association has launched a competition for new pro-birth slogans, with a deadline of September 15. After that, a jury will select 35 slogans and award prizes. Authors of the five best slogans will each receive 1,000 yuan (the equivalent of 130 euros).

For many Chinese citizens, Beijing’s changes have come too fast. The internet is filled with rage. Users recall cruel and incidents with impunity where all-powerful state controllers hunted down unscheduled heavily pregnant women in the countryside. They forced women to have abortions and had their homes demolished to intimidate neighbors. Babies born illegally were branded as “black children” or given extreme fines to their fathers.

For the 2016 Spring Festival, the two-child family was advertised in Beijing markets. Now new posters are needed for the three-child family.

Microblogs show photo montages of world-famous director Zhang Yimou, who was fined 7.48 million yuan (nearly a million euros) on January 9, 2014, as a “social tax” for violating the one-child policy for his three children. They depict Zhang exclaiming theatrically, “Give me back my millions.” As do many tens of thousands of ordinary Chinese who were forced to pay fines.

Calls for a critical reappraisal of the one-child policy

Party media news websites that praised the new birth policy and immediately took a virtual beating closed their comment functions because of too many “junk mails” (垃圾评论). Beijing censored calls ordering it to claim responsibility and come to critical terms with its one-child policy. Bloggers wrote slogans like, “If our leaders asked for our forgiveness, it would do more good than a 100 slogans.” (领导出来道个歉比想一百条标语管用.)

Three piglets in a family: 2018 saw the first harbinger of policy change on a stamp

Mockery of the three-child family hides behind allusions. My favorite is a pun on the character “Jiu,” spelled differently but pronounced the same, which means either the number nine (九), or Chinese chives (韭菜). The saying “三三得韭” could be interpreted as “3 times 3 is 9”, or as “3 times 3 makes (you) chives.” The leek plant is considered synonymous with the people. It grows back even if it is cut off again and again.

One blogger suggested that in response to Beijing’s propaganda, a double slogan (duilian) traditionally be hung lengthwise on the front door: One side reads: Parents give birth to three children in one household and have four grandparents to care for. On the other side, it says: At eight o’clock to work, at nine o’clock home. This is extremely exhausting, and the million-dollar home loan has not yet been paid off. And above it: “This is the life of the chives” (一个家庭,两个夫妻,生三个孩子,养四个老人。八点上班,晚九点下班,费十分力气,还百万房贷。韭菜的一生).

Census puts pressure on CCP

Beijing has been on edge since the latest census, published in May. With a birth rate of 1.3, China has the world’s lowest birth rate. With 12 million new births in 2020, demographers fear that the current population of 1.41 billion will start shrinking for the first time in 2022. The army of 16 to 59-year-old workers is also shrinking. The third red flag is that the population pyramid is starting to tip over. According to the 2020 China Development Report, China is getting older faster than rich. 181.6 million Chinese are already over 65 years old.

Alarming reports about negative economic and demographic consequences of state interfered birth planning have made Beijing change its policy. In contrast, there is a lack of critical socio- and self-reflection. Only the Nobel Prize winner for literature Mo Yan addressed the problem in his novel “The Frog” ( 莫言:蛙), when he recounted the fate of a female abortion doctor in the countryside.

China’s forced birth control has been tragically successful. It is estimated that 180 million only children live in the People’s Republic today. Beijing’s social engineers have done a great job. What they have done to the nation’s soul is hard to imagine.

  • Children
  • Chinese Communist Party
  • Demographics
  • NDRC
  • Society
  • Three-child policy

Executive Moves

Francois-David Martino has succeeded Dr. Thilo Theilen as CEO of Becker Stahl Service (BSS). Until June, Martino headed China affairs of the Italian plant engineering company Danieli. After studying mechanical engineering, he worked for Thyssenkrupp and Siemens, among others.

Yu Yongfu will be the new CEO of Alibaba Local Services. The division combines services such as food delivery services and local commerce under one roof. Yu succeeds Li Yonghe, who resigned after allegations of sexual misconduct.

Jack Kline will represent Cinity, a subsidiary of China Film Group and Huaxia Film Distribution, with his eponymous consulting company. Cinity manufactures large screens, projectors and other film technology.

Dessert

“A new school year, a new beginning,” this elementary school teacher in Beijing’s Haidian district writes beautifully on the blackboard in two colors. The floral pattern is meant to make the start seem all the more friendly. Elsewhere in the building, people are scrubbing and disinfecting to keep classrooms hygienic during the ongoing pandemic. Some first-graders in the German capital Berlin would envy the young Beijing kids for their clean and well-equipped schools.

China.Table Editors

CHINA.TABLE EDITORIAL OFFICE

Licenses:

    • Scientists splice plants with human genes
    • IfW discussion on protectionism
    • Xiaomi grabs car software start-up
    • Volvo plans to buy truck manufacturer
    • Xpeng increases sales and losses
    • Trade dispute: Hopes for Huawei?
    • Government aims to boost economy
    • Johnny Erling: Retrospective anger over one-child policy
    Dear reader,

    Even China’s seasoned censors are having a hard time fighting the current outrage sparked by the introduction of the three-child policy, as Johnny Erling tells in his column. In countless comments, Internet users recalled decades of a cruel population policy – the one-child policy. Pregnant women expecting their second child were persecuted and illegally born babies branded as “black children.” But instead of critical reflection on the consequences of its policy, the CCP is now trying to encourage its population to have more children with pro-birth slogans.

    Climate change is also a threat to vital farmlands through heat, droughts and torrential rain. Are genetically modified foods a way to maintain yields in the future? So far, Chinese authorities have been just as skeptical about the commercial application of genetic engineering in agriculture as their German counterparts. But skepticism could diminish as domestic companies gain more know-how, says Frank Sieren. A team of Chinese and American scientists has now managed to massively increase crop yields. The trick: the insertion of a human gene known to cause obesity. Bon appétit.

    Have a pleasant weekend!

    Your
    Nico Beckert
    Image of Nico  Beckert

    Feature

    Human genes for the super potato

    A new genetic engineering technique could boost crop yields of rice and potatoes by up to 50 percent and make them more drought-resistant to boot. This was the result of a study conducted by Chinese and American scientists and published in July in the British journal Nature Biotechnology. Lead authors are Qiong Yu and Shun Liu of Beijing University.

    The researchers have taken a new approach and introduced human genes into plants. In humans, these genes are associated with obesity. The so-called FTO gene is now even considered the “main switch” for obesity. But in plants, too, certain variants of the gene lead to an increase in mass. Apparently, the basic mechanisms of growth are similar in different organisms. This discovery may be used in the future to maintain a steady food supply despite climate change.

    In any case, trials in China have shown that the insertion of human FTO genes into plants makes them grow significantly stronger. Root systems were also more developed than average within the series of trials. “We think this is a very good strategy to engineer our crops,” Jia Guifang, a chemical biologist at Beijing University, tells Smithsonian Magazine. But she acknowledges the need for further research before such plants can be marketed as products. The process cannot be allowed to pose any risks to consumers.

    The procedure apparently works on almost all plant species, not just in rice and potatoes, but also in grass and trees. “The changes are actually dramatic,” explains He Chuan, professor at the University of Chicago and co-leader of the study. The science group has worked on it for more than a decade. Initially, it seemed like a crazy idea: “And to be honest, we expected disastrous results.” But to the scientists’ surprise, the human FTO sequence did not destroy or cripple the plants. Instead, it did only one thing: It made the plant grow, apparently without any limitations.

    Their strategy is a highly unusual one, says Donald Ort, professor of biology at the University of Illinois and a member of the US National Academy of Sciences (NAS). The Smithsonian Magazine had asked him for an independent assessment: the Chinese team was poking in the dark and probably struck gold. “They were quite surprised.” Ort is one of the leading U.S. researchers in the field.

    Hope for global nutrition

    As part of the study, researchers at laboratories of Beijing University, Guizhou University and the University of Chicago conducted their experiments in both laboratories and fields around Beijing and in the province of Jiangxi. One of the results was that the yield of FTO rice plants more than tripled under laboratory conditions compared to unmodified specimens. The genetically modified plants had a 47 percent higher crop yield and over 40 percent higher weight. Similar trials with potato plants resulted in a 50 percent increase in yield.

    Around nine million people die from starvation every year, more than from AIDS, malaria and tuberculosis combined. Worldwide, 690 million people suffered from hunger and food shortages last year – equivalent to around nine percent of the world’s population, 381 million in Asia alone. Climate change is increasing droughts around the globe, further reducing crop yields. In 2019, for example, southwest China’s Yunnan province was hit by a severe drought that damaged more than one million hectares of cropland and destroyed 16,667 hectares.

    The science group is convinced that FTO plants could provide a remedy to this problem as well. According to the U.S.-China study, FTO-modified rice plants had significantly higher survival rates under two different categories of drought conditions. “This new technique offers the possibility of modifying plants to adapt to the ongoing global warming,” He says. “Perhaps we could grow grass that is able to withstand droughts in threatened areas.”

    China views genetic engineering with suspicion

    No other nation spends as much on state-funded plant research as China. Yet, the country still has very strict standards for the application of genetically modified plants and products. Commercial cultivation of plants carrying genes from other organisms is almost completely illegal in China. Exceptions are certain varieties of cotton, papaya, tomato and tobacco.

    However, China’s reluctance is also due to the fact that the majority of promising GMO projects for human consumption have so far not come from domestic development. “It must be ruled out that foreign companies dominate the market for agrobiotechnology,” declared nation and party leader Xi Jinping at a conference of the Communist Party Central Committee five years ago.

    In the field of green genetic engineering, direct investment is therefore prohibited for foreign corporations. However, joint ventures with Chinese companies are allowed if they are limited to conventional or hybrid breeding.

    Currently, only the commercial cultivation of two GMOs is permitted in the EU: the corn “MON 810” and the potato “Amflora”. In Germany, no genetically modified plants have been commercially cultivated since 2012. After all, 80 percent of the German population has spoken out against cultivation. However, since even Germany is not able to meet the demand for protein-rich animal feed with GM-free feed alone, Germany and the EU import around 35 million tons of mostly genetically modified soybeans from North and South America every year.

    Worldwide, five genetically modified crops, in particular, are currently cultivated: soybeans, corn, cotton, rapeseed and sugar beet. The largest producers are the USA, Argentina, Brazil and India. China only ranks fifth. However, these agricultural products may only be imported into the EU if they feature one of the currently 50 import licenses. According to current knowledge, genetically modified feed is considered harmless for milk, meat or eggs.

    Could FTO plants jumpstart green genetic engineering?

    The cooperation between the US and China in this field cannot be taken for granted. In the past, US negotiators have repeatedly urged China to ease restrictions on genetically modified crops. This would enable U.S. agricultural tech companies to sell their modified seeds and other GM products in China’s vast agricultural sector. China is home to 22 percent of the world’s population, but has only about eight percent of global arable land.

    However, for the time being, Beijing seems to be unwilling to open up domestic cultivation of GM crops until Chinese companies are strong enough to keep up with global agri-tech giants, spearheaded by the US. China will further promote and regulate innovation, research and development, and application of genetically modified organisms, the Ministry of Agriculture and Rural Affairs announced this February.

    As in other economic fields, emerging proprietary developments could thus change the leadership’s stance towards a product group. If successful, the market approval of FTO crops by Chinese agricultural companies would be a technological and economic milestone that Beijing is unlikely to ignore. In addition, laws on genetic engineering could change as a result.

    In their next step, the scientists now want to achieve the same effect without foreign variants of FTO genes by changing the existing sequence in plant genomes. This at least eliminates the alarming aspect of introducing human genes into plants and eating them along with it.

    • Agriculture
    • Nutrition
    • Research
    • Science

    “We knock on the Great Wall in vain”.

    The event series on economic relations with China at the Kiel Institute for the World Economy (IfW) kicked off with a highly topical issue: the shift towards increased protectionism between major economic fields. The reasons for this are numerous. Prevention of supply bottlenecks, such as recently with protective masks or microchips, is currently at the top of the list and also gets a lot of public support. Other politicians are hoping for positive effects for the labor market in traditional sectors as more goods and parts are produced on the domestic market. Meanwhile, the CAI investment agreement with China has been caught up in political hostility between China and the EU. It was supposed to improve market access for both sides.

    Jörg Wuttke, the long-time president of the EU Chamber of Commerce in China, provided a practical perspective on these issues. Economist and IfW head Gabriel Felbermayr contributed with his expert assessment based on scientific calculations.

    Protectionism would be expensive

    Felbermayr has already presented the results of his calculations in China.Table: By producing in the Far East and procuring parts from the People’s Republic, the German economy gains much more than it could stand to gain through greater independence. The advantages of isolation would first have to outweigh the gains for trade barriers to be sensible. However, spreading the economy across several parts of the world saves costs and creates efficiencies. In the end, all parties involved own more than before, according to Felbermayr.

    The question of isolation or free trade is not even close to a tie, but very clear. According to simulations by the IfW, the disadvantages of economic isolation distinctly outweigh the advantages. Free trade is several times more beneficial than insisting on independence. Protectionism would reduce German economic output by up to 1.4 percent. Admittedly, a retreat to production within the EU creates somewhat more security in times of crisis. But overall, it will “cost an arm and a leg” in comparison, as Felbermayr puts it. Consumers will also end up with much less in their pocket, and their way of life will be damaged.

    Wuttke changes his perspective once more and looks at the problem from China’s position. He refers to a joint study by the EU Chamber and Chinese Research Institute Merics, which examined the impacts of decoupling. Researchers conclude that China, for its part, has never fully opened up, to begin with. According to the study, China has only ever engaged in “selective coupling” where it suited economic planners. This applies to the early phase of economic relations up to the present day. Trouble was inevitable. Sooner or later, the West was bound to decline an economic relationship that mainly sees only one beneficiary.

    China is more dependent on Europe than the other way round

    China has thus systematically proceeded to protect its own industries and companies from foreign competition since the beginning of its supposed policy of opening-up. The opening of its market primarily affected sectors in which China wanted to gain know-how. Opening up only took place once its own economy was sufficiently developed. The EU and the US, on the other hand, opened their gates wide to Chinese imports right from the get-go, even though domestic companies suffered as a result.

    This causes China’s isolation to be more painful for local companies than the incipient protectionism of the West. “We keep knocking on the Great Wall, but no one lets us in,” says Wuttke. China’s response to the crisis of interdependence is also now a focus on greater autarky. Greater independence from the outside is currently one of the planners’ declared goals. This is especially true in the tech sector.

    However, this policy could also do more harm than good to China itself, Wuttke warned. “China is much more dependent on Europe than Europe is on China,” observes the president of the EU Chamber of Commerce. Most tech transfers to China stem from the EU, and European countries are huge buyers of Chinese goods.

    Decoupling inhibits potential development

    According to Wuttke’s observation, political priorities and the drive for independence are already hampering China’s potential. Since the opening at the end of the 1970s, China has made a transformation very similar to Japan and South Korea in their respective boom phases. But their common economic curves are already coming to an end, and China’s wealth progression is already dropping below that of its neighbors at the time.

    Thus, according to the two experts, there is no need for the EU to raise tariffs or otherwise close the gates to goods from the Far East. Felbermayr also points out that the EU’s supposed dependence on China has not increased. The supply relationships of European companies are very evenly distributed. The USA remains an important partner.

    The European Supply Chain Act appears to both Felbermayr and Wuttke as a possible obstacle to economic development in both regions. According to Felbermayr, it is an expression of a new form of protectionism. Wuttke, as a practitioner from the business world, sees enormous problems for the industry on the horizon.

    Moreover, delivery stops not only occur in Asia, but in Europe as well. This is evident by the Covid crisis, which is seen as evidence for the need for decoupling. While it is true that in the first phase, production halts affected Chinese regions such as Wuhan. But in the end, China recovered much quicker than the EU and now is virtually free of Covid. This makes them all the more valuable as a sales market for ailing Western economies.

    The next event in the series will take place on 30 September: Fair Competition and Subsidies – Europe’s Companies and China’s Competitive Pressure. Dietmar Baetge from the Technical University of Wildau and Jürgen Matthes from the Institute of the German Economy (IW) Cologne will discuss this topic.

    • Decoupling
    • EU
    • Geopolitics
    • IfW
    • Sanctions
    • Trade
    • USA

    News

    Xiaomi acquires autonomous driving start-up

    Smartphone manufacturer Xiaomi has announced the acquisition of startup Deepmotion for $77 million. Deepmotion was founded four years ago and develops driver assistance software, Bloomberg reports. The purchase of Deepmotion is expected to aid Xiaomi’s developments in fully autonomous driving, according to Xiaomi executive Wang Xiang. The acquisition comes in tandem with Xiaomi’s expansion into the EV sector. The plan is to invest ten billion U.S. dollars in the field over the next decade. Xiaomi overtook US-company Apple as the second-largest smartphone maker for the first time during the second quarter of 2021. Net profit rose by 80 percent to the equivalent of nearly 1.1 billion euros. nib

    • autonomous driving
    • Car Industry
    • Xiaomi

    Volvo about to acquire truck manufacturer

    Volvo Trucks is about to purchase Chinese truck manufacturer JMC Heavy Duty Vehicle. The takeover for the equivalent of 123 million US dollars still has to be approved by Chinese authorities, as the business portal Caixin reports. Volvo, a subsidiary of Chinese manufacturer Geely, would gain full control of JMC Heavy Duty Vehicle through the acquisition and would not have to enter into a joint venture. In 2020, the Chinese government issued new rules to remove the joint venture requirement in the production of commercial vehicles. The Swedish-Chinese company would thus also take over a truck factory located in Taiyuan in northern China. According to Caixin, the plant will produce 15,000 trucks per year for the Chinese market starting by the end of 2022. Due to the logistics boom in China, many truck manufacturers are considering production facilities in the People’s Republic, according to the portal. nib

    • Car Industry
    • Logistics
    • Volvo

    Xpeng with high losses

    Chinese EV company Xpeng has reported mixed quarterly results. Xpeng had to register net losses of the equivalent of 184 million US dollars in the 2nd quarter – higher than previous forecasts. High expenses in research and development and marketing and sales were cited as the cause. However, Xpeng was able to increase sales and shipped just over 17,400 cars in the second quarter, more than planned, Bloomberg reports. Overall, the market for EV in China is growing strong once again. Nearly 1.5 million alternative-powered vehicles were sold in the first seven months of this year. More than in the entire previous year, according to data from the China Association of Automobile Manufacturers. nib

    • CAAM
    • Car Industry
    • Xpeng

    Trade dispute: Is the ice melting around Huawei?

    Networking specialist Huawei has apparently received permission in the US to order American-made car chips. The approval by President Joe Biden’s administration is seen as a sign that it could soften sanctions against the Chinese company. Specifically, the order is for semiconductor elements for sensors used in self-driving cars, the Chinese People’s Daily and Reuters news agency report in unison. Huawei is currently entering the vehicle business as a supplier(China.Table reported).

    Biden’s predecessor had made the export of high technology to potentially dangerous companies from China subject to approval and then denied any approval. That amounted to an export ban on key components for Huawei and other Chinese tech companies. Because it is a licensing requirement, not a blanket ban, Biden can now readjust the policy without a new rule change. fin

    • Car Industry
    • Geopolitics
    • Huawei
    • Sanctions
    • Semiconductor
    • Trade
    • USA

    Xi wants to boost economy

    Head of state Xi Jinping is worried about the economic targets for the current year and hints at new economic stimulus measures. This is reported by news agency dpa citing an article in the party’s own “People’s Newspaper”. The central bank could loosen monetary policy again and give out fresh loans. New infrastructure projects are also being discussed. The background is a weaker economic recovery in the second Covid year. fin

    • Economy
    • Finance
    • Xi Jinping

    Opinion

    Three-child policy: China’s planners cut chives

    By Johnny Erling
    Ein Bild von Johnny Erling

    China adopted a new ideal as a “birth-friendly nation.” To this end, Beijing has been searching online for propaganda rhetoric to make China’s households more palatable to the newly permitted child policy. The Internet community reacted differently than hoped – with an angry and derisive “shit storm”.

    Once again, the Communist Party is asking China’s families to reinvent themselves. Everything that once applied and from which they suffered is to be forgotten practically overnight: 35 years of one-child policy with enforced birth control, surveillance, abortion, sterilization and harassment without end by a state even interfering in their bedrooms are to simply pass. Bearing children is once again the first civic duty, the Politburo decided on May 31. The party elite coined a new slogan: “Let’s be eager to create a birth-friendly society.” (努力构建 生育友好型社会).

    The National People’s Congress (China’s socialist parliament) needed less than eight weeks to make 21 amendments to the People’s Republic’s Population and Family Planning Law, which has been in force since 2002. It was only in 2015 that the law was expanded to allow for the population to have two children. On Tuesday of last week, the Standing Committee of the National People’s Congress discussed the comprehensively revised new version. On Friday, after its first reading, it was already waved through and immediately put into effect.

    The law allows for having three children, eliminates all penalties and fines for undeclared births, and promises families future government support. The adjustment extends from paid parental leave and more daycare facilities to birth-friendly adjustments to the financial, tax, insurance and educational systems, as well as to housing and employment. In the current five-year plan to 2025, the NDRC, the lead planning authority, plans to knock down the first pegs for China as a welcoming society; the age for marriage and for the birth of one’s first child is also to be lowered again. In 1990, Chinese married at an average age of 21.4. In 2017, they were 25.7 years old.

    Search for pro-birth slogans

    To drum up support, China’s Family Planning Association has launched a competition for new pro-birth slogans, with a deadline of September 15. After that, a jury will select 35 slogans and award prizes. Authors of the five best slogans will each receive 1,000 yuan (the equivalent of 130 euros).

    For many Chinese citizens, Beijing’s changes have come too fast. The internet is filled with rage. Users recall cruel and incidents with impunity where all-powerful state controllers hunted down unscheduled heavily pregnant women in the countryside. They forced women to have abortions and had their homes demolished to intimidate neighbors. Babies born illegally were branded as “black children” or given extreme fines to their fathers.

    For the 2016 Spring Festival, the two-child family was advertised in Beijing markets. Now new posters are needed for the three-child family.

    Microblogs show photo montages of world-famous director Zhang Yimou, who was fined 7.48 million yuan (nearly a million euros) on January 9, 2014, as a “social tax” for violating the one-child policy for his three children. They depict Zhang exclaiming theatrically, “Give me back my millions.” As do many tens of thousands of ordinary Chinese who were forced to pay fines.

    Calls for a critical reappraisal of the one-child policy

    Party media news websites that praised the new birth policy and immediately took a virtual beating closed their comment functions because of too many “junk mails” (垃圾评论). Beijing censored calls ordering it to claim responsibility and come to critical terms with its one-child policy. Bloggers wrote slogans like, “If our leaders asked for our forgiveness, it would do more good than a 100 slogans.” (领导出来道个歉比想一百条标语管用.)

    Three piglets in a family: 2018 saw the first harbinger of policy change on a stamp

    Mockery of the three-child family hides behind allusions. My favorite is a pun on the character “Jiu,” spelled differently but pronounced the same, which means either the number nine (九), or Chinese chives (韭菜). The saying “三三得韭” could be interpreted as “3 times 3 is 9”, or as “3 times 3 makes (you) chives.” The leek plant is considered synonymous with the people. It grows back even if it is cut off again and again.

    One blogger suggested that in response to Beijing’s propaganda, a double slogan (duilian) traditionally be hung lengthwise on the front door: One side reads: Parents give birth to three children in one household and have four grandparents to care for. On the other side, it says: At eight o’clock to work, at nine o’clock home. This is extremely exhausting, and the million-dollar home loan has not yet been paid off. And above it: “This is the life of the chives” (一个家庭,两个夫妻,生三个孩子,养四个老人。八点上班,晚九点下班,费十分力气,还百万房贷。韭菜的一生).

    Census puts pressure on CCP

    Beijing has been on edge since the latest census, published in May. With a birth rate of 1.3, China has the world’s lowest birth rate. With 12 million new births in 2020, demographers fear that the current population of 1.41 billion will start shrinking for the first time in 2022. The army of 16 to 59-year-old workers is also shrinking. The third red flag is that the population pyramid is starting to tip over. According to the 2020 China Development Report, China is getting older faster than rich. 181.6 million Chinese are already over 65 years old.

    Alarming reports about negative economic and demographic consequences of state interfered birth planning have made Beijing change its policy. In contrast, there is a lack of critical socio- and self-reflection. Only the Nobel Prize winner for literature Mo Yan addressed the problem in his novel “The Frog” ( 莫言:蛙), when he recounted the fate of a female abortion doctor in the countryside.

    China’s forced birth control has been tragically successful. It is estimated that 180 million only children live in the People’s Republic today. Beijing’s social engineers have done a great job. What they have done to the nation’s soul is hard to imagine.

    • Children
    • Chinese Communist Party
    • Demographics
    • NDRC
    • Society
    • Three-child policy

    Executive Moves

    Francois-David Martino has succeeded Dr. Thilo Theilen as CEO of Becker Stahl Service (BSS). Until June, Martino headed China affairs of the Italian plant engineering company Danieli. After studying mechanical engineering, he worked for Thyssenkrupp and Siemens, among others.

    Yu Yongfu will be the new CEO of Alibaba Local Services. The division combines services such as food delivery services and local commerce under one roof. Yu succeeds Li Yonghe, who resigned after allegations of sexual misconduct.

    Jack Kline will represent Cinity, a subsidiary of China Film Group and Huaxia Film Distribution, with his eponymous consulting company. Cinity manufactures large screens, projectors and other film technology.

    Dessert

    “A new school year, a new beginning,” this elementary school teacher in Beijing’s Haidian district writes beautifully on the blackboard in two colors. The floral pattern is meant to make the start seem all the more friendly. Elsewhere in the building, people are scrubbing and disinfecting to keep classrooms hygienic during the ongoing pandemic. Some first-graders in the German capital Berlin would envy the young Beijing kids for their clean and well-equipped schools.

    China.Table Editors

    CHINA.TABLE EDITORIAL OFFICE

    Licenses:

      Sign up now and continue reading immediately

      No credit card details required. No automatic renewal.

      Sie haben bereits das Table.Briefing Abonnement?

      Anmelden und weiterlesen