At the annual press conference of the National People’s Congress, Beijing traditionally presents its foreign policy principles and priorities to the international community. On Thursday, China’s chief diplomat Wang Yi picked up exactly where he left off last year, writes Joern Petring – by lashing out against the United States. Wang said that their list of sanctions against China had now reached absurd proportions, and Washington is ultimately only harming itself.
Wang urged the Europeans to cooperate better. Denigrating China as a systematic rival would not get anyone anywhere. As a kind of olive branch to the EU, Wang immediately announced relaxed entry regulations for countries like Austria and Belgium. Perhaps he is already betting on the US-European estrangement if Trump is re-elected.
Meanwhile, the mood in the European solar industry is bleak. Chinese competitors have flooded the global market with state-subsidized modules. No European supplier can compete with their dumping prices, on the contrary: Falling prices have made European suppliers increasingly less competitive.
To counter this, the EU member states want to develop a European solar industry by 2030. The aim is to cover 40 percent of domestic demand. The problem: Building solar plants in Europe is around three to four times more expensive than in China. In other words, the EU would have to provide massive subsidies. And that could make the energy transition in the solar energy sector 50 percent more expensive. Nico Beckert analyzes how dependence on China can be reduced nonetheless.
China’s chief diplomat Wang Yi used his annual press conference on the sidelines of the People’s Congress to attack Washington’s policies – while extending an olive branch to Europe. Wang said on Thursday of imposing an insane level of trade restrictions on China.
“The US has been devising various tactics to suppress China and kept lengthening its unilateral sanctions list, reaching bewildering levels of unfathomable absurdity,” said the Foreign Minister. “If the US is obsessed with suppressing China, it will eventually harm itself,” Wang Yi warned, adding that Washington should not try to keep China at the bottom of the value chain.
Wang’s words were reminiscent of his appearance precisely one year ago when he also used the media-effective event on the sidelines of the People’s Congress to lash out at the United States.
The strictly choreographed press conference usually does not present any new Chinese positions. However, the slightly varying choice of words from year to year shows how China is adapting its foreign policy priorities and attitudes and serves as a message to the international community, particularly to countries with existing tensions or with which China would like to improve its relations.
Unsurprisingly, Wang praised relations with Russia. Once again, Wang also called for a large peace conference on the Ukraine question.
His verdict on Europe was mixed. On the one hand, Wang accused the EU of wrongly labeling China as a “competitor and systematic rival.” However, as long as China and Europe worked together for mutual benefit, “there will be no room for bloc confrontation.” Wang not only called for cooperation. He also had a gift in store.
He used the conference to announce that citizens from six additional European countries would no longer require a visa to enter China. These are Switzerland, Ireland, Hungary, Austria, Luxembourg and Belgium. In recent months, numerous other European countries, including Germany, have already been included in the pilot program for Chinese visa facilitation. Such an announcement during the Congress of the People’s Congress is highly unusual.
The intention is probably to avoid driving the EU even further into the hands of the Americans by pursuing a friendly policy. However, tensions between Brussels and Beijing have recently increased noticeably. The announced EU investigation into Chinese EV subsidies is just one example. Meanwhile, as Bloomberg reported on Wednesday, Washington urged allies such as the Netherlands, Germany, South Korea, and Japan to further tighten their chip restrictions against China.
Wang’s choice of words on another issue, the Taiwan question, was slightly harsher than last year. This is probably connected to the upcoming inauguration of Taiwan’s new President, Lai Ching-te, in May.
“Whoever supports Taiwan’s independence will be burned and swallow the bitter pill for their actions,” Wang Yi said at Thursday’s press conference. China would never allow Taiwan to secede from the mainland. Regarding the Gaza war, the Chinese Foreign Minister once again called for an end to the violence against civilians in the Gaza Strip. “There can no longer be any justification for the continuation of the conflict and no excuse for the killing of civilians,” said Wang.
The European solar industry is reeling. Chinese competitors are flooding the global market with state-subsidized modules at dumping prices, and European suppliers are increasingly losing competitiveness due to falling prices. Europe’s biggest manufacturer, Meyer Burger, threatens to relocate to the United States, which offers attractive subsidies. German manufacturers are also pleading with the German government for help. If they don’t receive help soon, they, too, could go out of business.
The EU Commission has no intention of helping out, either. As EU Commissioners recently made clear, it has no plans for trade restrictions against Chinese modules or new subsidies. Instead, the Commission shifts responsibility to the member states. The goals are ambitious, after all: The EU member states aim to develop a European solar industry that can cover 40 percent of domestic demand by 2030 with their Net Zero Industry Act (NZIA) – at all stages of the value chain. The idea is to reduce dependence on China, which currently accounts for 80 to 95 percent of global production along the entire value chain.
Experts believe that the 40 percent target is neither realistic nor sensible. There is neither the will to invest in new plants nor the necessary incentives for investment to achieve the 40 percent target, Antoine Vagneur-Jones, solar expert at the analysis company BloombergNEF, told Table.Briefings. “Building solar plants in Europe is about three to four times more expensive than in China,” says Vagneur-Jones.
According to the EU Commission’s optimistic estimates, developing an industry with the necessary capacities would cost 7.5 billion euros. The association Solar Power Europe, on the other hand, assumes that investments of 30 billion euros would be required and that these would have to be made by 2025, according to Marie Tamba, Senior Research Analyst at Rhodium Group.
In order to build up a significant industry, Europe would have to “massively subsidize the investments and operating costs of solar manufacturers,” says Jenny Chase, a long-time solar analyst at BloombergNEF, in an interview with Table.Briefings. She estimates Meyer Burger’s production costs at over 40 US cents per watt, while the market price is only just over 11 US cents. Chase expressed regret: Meyer Burger has a lot of experience. It would be a “heavy blow if they withdrew.”
Analysts from the think tank Bruegel doubt that the 40 percent target makes sense at all. “Full manufacturing processes involve energy and capital-intensive investment where Europe has no advantage,” the analysts write. For example, they cite the energy-intensive production of polysilicon, the raw material for solar cells. “The global solar market, for example, is extraordinarily oversupplied and there is no climate benefit from subsidizing extra production today,” conclude the Bruegel analysts. Chase also has doubts: “The solar industry is a difficult business segment. The competition is brutal.” The newest plants have the best technology and therefore a competitive advantage. Older manufacturers have major disadvantages because the equipment is quickly outdated.
Chase estimates that the energy transition in the solar energy sector would become “perhaps 50 percent” more expensive if Europe were to significantly reduce its dependence on Chinese modules. The BloombergNEF expert believes that this is unlikely to happen.
Analysts at energy consultancy Wood Mackenzie also expect a massive price increase. In the last decade, solar module costs have fallen by 85 percent. “China’s clean-tech manufacturing capacity expansion has been at the heart of this story,” they write in a recent analysis. “Without China at the table, Aggressive cost reductions we have become accustomed to are over.” According to a 2022 Nature study, the globalized solar supply chain saved Germany around seven billion US dollars alone between 2008 and 2020.
Even if other risks associated with a high level of dependence on China are taken into account, “the advantages of cheap imports outweigh the risks for the solar industry for the time being,” says Tobias Gehrke, Senior Policy Fellow at the European Council on Foreign Relations think tank. “The combined security and economic risks are probably too small to iron out the disadvantage of Europe’s lack of competitiveness,” says the analyst and expert on competition between the major powers in the global economy.
Antoine Vagneur-Jones from BloombergNEF summarizes the situation: “The overcapacities in the solar sector are good for the energy transition: They make everything cheaper. But they weaken the economic arguments in favor of building a solar industry.”
The Bruegel analysts suggest stockpiling solar modules and diversifying trade relations as a way of becoming less dependent on China. For example, the United States and India are currently building up their own solar industries. According to Bruegel analysts, stocks of around 30 percent of market demand could lead to a certain flexibility in case China abruptly stopped selling modules. “Import diversification is a more powerful and efficient tool than import substitution,” they write.
However, Chase disagrees. If the EU states wanted to import more from the USA or India, they would have to “pay more for inferior products than for those from China.” Her colleague Antoine Vagneur-Jones points out that US manufacturers also feel the effects of overcapacity and that the first announced investments have already been canceled – despite US subsidies. BloombergNEF estimates that only around half of the announced US solar investments totaling 60 gigawatts for 2024 will actually be built. Ironically, almost a quarter of the planned investment comes from Chinese manufacturers, who are now also receiving US subsidies. India could become more of an exporter to Europe, says Elissa Pierce, Research Associate at energy consultancy Wood Mackenzie. “At a price of 20 US cents per watt, Indian modules are more attractive to European buyers than US modules,” says the analyst. US modules are currently priced at 35 cents per watt.
However, there is a small glimmer of hope for Meyer Burger’s solar module plant in Germany. The company “1Komma5°,” a provider of solar systems, heat pumps, electricity storage systems and wallboxes, apparently wants to take over the production facilities should Meyer Burger actually abandon the plant.
A new legal option from the Net-Zero Industry Act would allow the German government to approve new plants quickly in special acceleration areas, in which private investors would be relieved of bureaucracy. “The German government must invest to make Germany attractive again for the manufacturing industry, for example by setting up Net-Zero Acceleration Valleys,” says Christian Ehler, CDU MEP, who negotiated the NZIA for Parliament.
This Friday is International Women’s Day. On this day, women in China are given half a day off. Entire groups of female employees or friends visit places of interest, stroll through parks or shopping malls, take photos, eat together – or buy themselves flowers, like they did here a year ago in Kunming, Yunnan province. Women’s Day is an old socialist holiday that is actually intended to celebrate equality.
However, women’s rights in the People’s Republic are currently under pressure. Under Xi Jinping, because of the aging Chinese society, the CCP has once again started promoting traditional values and is urging women to have more children. However, as expert Leta Hong Fincher recently told Table.Briefings, many young women are not embracing this idea.
At the annual press conference of the National People’s Congress, Beijing traditionally presents its foreign policy principles and priorities to the international community. On Thursday, China’s chief diplomat Wang Yi picked up exactly where he left off last year, writes Joern Petring – by lashing out against the United States. Wang said that their list of sanctions against China had now reached absurd proportions, and Washington is ultimately only harming itself.
Wang urged the Europeans to cooperate better. Denigrating China as a systematic rival would not get anyone anywhere. As a kind of olive branch to the EU, Wang immediately announced relaxed entry regulations for countries like Austria and Belgium. Perhaps he is already betting on the US-European estrangement if Trump is re-elected.
Meanwhile, the mood in the European solar industry is bleak. Chinese competitors have flooded the global market with state-subsidized modules. No European supplier can compete with their dumping prices, on the contrary: Falling prices have made European suppliers increasingly less competitive.
To counter this, the EU member states want to develop a European solar industry by 2030. The aim is to cover 40 percent of domestic demand. The problem: Building solar plants in Europe is around three to four times more expensive than in China. In other words, the EU would have to provide massive subsidies. And that could make the energy transition in the solar energy sector 50 percent more expensive. Nico Beckert analyzes how dependence on China can be reduced nonetheless.
China’s chief diplomat Wang Yi used his annual press conference on the sidelines of the People’s Congress to attack Washington’s policies – while extending an olive branch to Europe. Wang said on Thursday of imposing an insane level of trade restrictions on China.
“The US has been devising various tactics to suppress China and kept lengthening its unilateral sanctions list, reaching bewildering levels of unfathomable absurdity,” said the Foreign Minister. “If the US is obsessed with suppressing China, it will eventually harm itself,” Wang Yi warned, adding that Washington should not try to keep China at the bottom of the value chain.
Wang’s words were reminiscent of his appearance precisely one year ago when he also used the media-effective event on the sidelines of the People’s Congress to lash out at the United States.
The strictly choreographed press conference usually does not present any new Chinese positions. However, the slightly varying choice of words from year to year shows how China is adapting its foreign policy priorities and attitudes and serves as a message to the international community, particularly to countries with existing tensions or with which China would like to improve its relations.
Unsurprisingly, Wang praised relations with Russia. Once again, Wang also called for a large peace conference on the Ukraine question.
His verdict on Europe was mixed. On the one hand, Wang accused the EU of wrongly labeling China as a “competitor and systematic rival.” However, as long as China and Europe worked together for mutual benefit, “there will be no room for bloc confrontation.” Wang not only called for cooperation. He also had a gift in store.
He used the conference to announce that citizens from six additional European countries would no longer require a visa to enter China. These are Switzerland, Ireland, Hungary, Austria, Luxembourg and Belgium. In recent months, numerous other European countries, including Germany, have already been included in the pilot program for Chinese visa facilitation. Such an announcement during the Congress of the People’s Congress is highly unusual.
The intention is probably to avoid driving the EU even further into the hands of the Americans by pursuing a friendly policy. However, tensions between Brussels and Beijing have recently increased noticeably. The announced EU investigation into Chinese EV subsidies is just one example. Meanwhile, as Bloomberg reported on Wednesday, Washington urged allies such as the Netherlands, Germany, South Korea, and Japan to further tighten their chip restrictions against China.
Wang’s choice of words on another issue, the Taiwan question, was slightly harsher than last year. This is probably connected to the upcoming inauguration of Taiwan’s new President, Lai Ching-te, in May.
“Whoever supports Taiwan’s independence will be burned and swallow the bitter pill for their actions,” Wang Yi said at Thursday’s press conference. China would never allow Taiwan to secede from the mainland. Regarding the Gaza war, the Chinese Foreign Minister once again called for an end to the violence against civilians in the Gaza Strip. “There can no longer be any justification for the continuation of the conflict and no excuse for the killing of civilians,” said Wang.
The European solar industry is reeling. Chinese competitors are flooding the global market with state-subsidized modules at dumping prices, and European suppliers are increasingly losing competitiveness due to falling prices. Europe’s biggest manufacturer, Meyer Burger, threatens to relocate to the United States, which offers attractive subsidies. German manufacturers are also pleading with the German government for help. If they don’t receive help soon, they, too, could go out of business.
The EU Commission has no intention of helping out, either. As EU Commissioners recently made clear, it has no plans for trade restrictions against Chinese modules or new subsidies. Instead, the Commission shifts responsibility to the member states. The goals are ambitious, after all: The EU member states aim to develop a European solar industry that can cover 40 percent of domestic demand by 2030 with their Net Zero Industry Act (NZIA) – at all stages of the value chain. The idea is to reduce dependence on China, which currently accounts for 80 to 95 percent of global production along the entire value chain.
Experts believe that the 40 percent target is neither realistic nor sensible. There is neither the will to invest in new plants nor the necessary incentives for investment to achieve the 40 percent target, Antoine Vagneur-Jones, solar expert at the analysis company BloombergNEF, told Table.Briefings. “Building solar plants in Europe is about three to four times more expensive than in China,” says Vagneur-Jones.
According to the EU Commission’s optimistic estimates, developing an industry with the necessary capacities would cost 7.5 billion euros. The association Solar Power Europe, on the other hand, assumes that investments of 30 billion euros would be required and that these would have to be made by 2025, according to Marie Tamba, Senior Research Analyst at Rhodium Group.
In order to build up a significant industry, Europe would have to “massively subsidize the investments and operating costs of solar manufacturers,” says Jenny Chase, a long-time solar analyst at BloombergNEF, in an interview with Table.Briefings. She estimates Meyer Burger’s production costs at over 40 US cents per watt, while the market price is only just over 11 US cents. Chase expressed regret: Meyer Burger has a lot of experience. It would be a “heavy blow if they withdrew.”
Analysts from the think tank Bruegel doubt that the 40 percent target makes sense at all. “Full manufacturing processes involve energy and capital-intensive investment where Europe has no advantage,” the analysts write. For example, they cite the energy-intensive production of polysilicon, the raw material for solar cells. “The global solar market, for example, is extraordinarily oversupplied and there is no climate benefit from subsidizing extra production today,” conclude the Bruegel analysts. Chase also has doubts: “The solar industry is a difficult business segment. The competition is brutal.” The newest plants have the best technology and therefore a competitive advantage. Older manufacturers have major disadvantages because the equipment is quickly outdated.
Chase estimates that the energy transition in the solar energy sector would become “perhaps 50 percent” more expensive if Europe were to significantly reduce its dependence on Chinese modules. The BloombergNEF expert believes that this is unlikely to happen.
Analysts at energy consultancy Wood Mackenzie also expect a massive price increase. In the last decade, solar module costs have fallen by 85 percent. “China’s clean-tech manufacturing capacity expansion has been at the heart of this story,” they write in a recent analysis. “Without China at the table, Aggressive cost reductions we have become accustomed to are over.” According to a 2022 Nature study, the globalized solar supply chain saved Germany around seven billion US dollars alone between 2008 and 2020.
Even if other risks associated with a high level of dependence on China are taken into account, “the advantages of cheap imports outweigh the risks for the solar industry for the time being,” says Tobias Gehrke, Senior Policy Fellow at the European Council on Foreign Relations think tank. “The combined security and economic risks are probably too small to iron out the disadvantage of Europe’s lack of competitiveness,” says the analyst and expert on competition between the major powers in the global economy.
Antoine Vagneur-Jones from BloombergNEF summarizes the situation: “The overcapacities in the solar sector are good for the energy transition: They make everything cheaper. But they weaken the economic arguments in favor of building a solar industry.”
The Bruegel analysts suggest stockpiling solar modules and diversifying trade relations as a way of becoming less dependent on China. For example, the United States and India are currently building up their own solar industries. According to Bruegel analysts, stocks of around 30 percent of market demand could lead to a certain flexibility in case China abruptly stopped selling modules. “Import diversification is a more powerful and efficient tool than import substitution,” they write.
However, Chase disagrees. If the EU states wanted to import more from the USA or India, they would have to “pay more for inferior products than for those from China.” Her colleague Antoine Vagneur-Jones points out that US manufacturers also feel the effects of overcapacity and that the first announced investments have already been canceled – despite US subsidies. BloombergNEF estimates that only around half of the announced US solar investments totaling 60 gigawatts for 2024 will actually be built. Ironically, almost a quarter of the planned investment comes from Chinese manufacturers, who are now also receiving US subsidies. India could become more of an exporter to Europe, says Elissa Pierce, Research Associate at energy consultancy Wood Mackenzie. “At a price of 20 US cents per watt, Indian modules are more attractive to European buyers than US modules,” says the analyst. US modules are currently priced at 35 cents per watt.
However, there is a small glimmer of hope for Meyer Burger’s solar module plant in Germany. The company “1Komma5°,” a provider of solar systems, heat pumps, electricity storage systems and wallboxes, apparently wants to take over the production facilities should Meyer Burger actually abandon the plant.
A new legal option from the Net-Zero Industry Act would allow the German government to approve new plants quickly in special acceleration areas, in which private investors would be relieved of bureaucracy. “The German government must invest to make Germany attractive again for the manufacturing industry, for example by setting up Net-Zero Acceleration Valleys,” says Christian Ehler, CDU MEP, who negotiated the NZIA for Parliament.
This Friday is International Women’s Day. On this day, women in China are given half a day off. Entire groups of female employees or friends visit places of interest, stroll through parks or shopping malls, take photos, eat together – or buy themselves flowers, like they did here a year ago in Kunming, Yunnan province. Women’s Day is an old socialist holiday that is actually intended to celebrate equality.
However, women’s rights in the People’s Republic are currently under pressure. Under Xi Jinping, because of the aging Chinese society, the CCP has once again started promoting traditional values and is urging women to have more children. However, as expert Leta Hong Fincher recently told Table.Briefings, many young women are not embracing this idea.
