To instill stability and positive energy in a chaotic world: These words by Xi Jinping sound like irony at the meeting with his “old friend” Vladimir Putin in Uzbekistan. But the Shanghai Cooperation Organization (SCO) summit in Samarkand shows much more than just solidarity between China and Russia, analyzes Michael Radunski. It also clarifies how China is expanding its power in Central Asia – in Russia’s former sphere of influence, of all places.
China’s growing influence is currently also a concern for the German government. In an interview with Table.Media, Franziska Brantner, State Secretary for Economic Affairs, is in favor of not granting investment guarantees if ethical or labor standards are not reached in production in a region. However, she does not want German companies to withdraw entirely from the Chinese market. Instead, Brantner calls for more German innovation, greater market diversification, and a clearer awareness of risk on the part of companies. German policy toward China must understand how the country has changed in recent years. Otherwise, there is a risk of dangerous dependencies, warns Brantner.
Today’s column by Johnny Erling is about the high art of “Peking duck diplomacy.” During his research, he came across a US secret document dating back to 1971 that makes your mouth water. In it, Henry Kissinger, then National Security Advisor, tells his boss Richard Nixon about a preparatory trip for Nixon’s state visit to China – and has nothing but high praise for Chinese cuisine. With a Peking duck, garnished with fine cucumber strips and a delicious sauce, China’s premier Zhou Enlai quickly won the heart of the envoys. Mao’s chef even personally cooked for Nixon during his trip in 1972. The way to a diplomat’s heart is through his stomach, after all.
China’s President is back on the international stage. At the Shanghai Cooperation Organization (SCO) summit in Uzbekistan, Xi Jinping met with the heads of state of India, Pakistan, Iran, and Russia.
However, the talks with Russian President Vladimir Putin were highly anticipated. In Samarkand, the two leaders eloquently assured each other of their mutual support. Xi called Putin an “old friend” and announced that China would continue to cooperate closely with Russia. China will work with Russia to “instill stability and positive energy in a chaotic world.”
Putin, in turn, was very pleased. “We highly value the balanced position of our Chinese friends when it comes to the Ukraine crisis.” Putin also admitted that Xi had raised questions and concerns about the situation in Ukraine with him during the talks. Regarding Taiwan, he promised that Russia would support China’s “one-country policy” and rejected the West’s provocations. This refers, among other things, to the Taiwan visit of Nancy Pelosi, Speaker of the US House of Representatives.
At the same time, the Russian Defense Ministry announced joint patrols of the naval forces of the two countries in the Pacific. These patrols were intended to “strengthen naval cooperation between the Russian Federation and the People’s Republic of China, maintain peace and stability in the Asia-Pacific region,” monitor the coastline, and protect sites of economic value.
In any case, Xi and Putin are using their meeting in Samarkand to show that Russia and China are far less isolated internationally than many Western politicians proclaim – and the two-day SCO summit came at a perfect time for them to do so.
The SCO exemplifies how China is preparing to establish alternative structures to Western-dominated institutions: The SCO, founded in 2001, includes China, Russia, India, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, and Uzbekistan. Neither Western Europeans nor Americans are at the table, but countries such as Belarus (as an observer state) and Iran, which will soon join the SCO, were announced in Samarkand.
“The SCO currently serves China and Russia as an alternative to the existing US-dominated institutions of international politics,” explains Eva Seiwert, research associate at the Friedrich Alexander University of Erlangen-Nuremberg and associate research fellow at the OSCE Academy in Bishkek, in an interview with China.Table. This became particularly clear in 2018, when Xi invited SCO leaders to the eastern Chinese port city of Qingdao, while the great powers of the West were meeting in La Malbaie, Canada, for the G7 summit.
And this is precisely the true focus of Xi’s first foreign visit. The Central Asia region is of great importance to China. It was in Kazakhstan where Xi unveiled his biggest foreign policy project in September 2013: the Belt and Road Initiative. Since then, China has invested massively in the region – financially in countless infrastructure projects, and diplomatically in building good relations with individual states. “China is doing very well to keep expanding its influence in Russia’s former sphere of influence through the SCO,” Seiwert says.
On Thursday, China and Uzbekistan signed trade and investment agreements worth $15 billion. And Iran’s accession to the SCO, announced in Samarkand, can certainly be seen as a success for Xi. The China-dominated SCO thus gains an important geostrategic player.
Meanwhile, former Soviet republics such as Uzbekistan and Kazakhstan feel increasingly threatened by the Russian attack on Ukraine and are distancing themselves from Russia. Kazakhstan in particular has recently taken a clear stance against the Russian incursion.
This is in stark contrast to China. Last week, Li Zhanshu, a Communist Party’s Standing Committee member and thus one of China’s most powerful nine men, traveled to Russia. There, he explicitly expressed China’s understanding of Russia’s incursion: “Ukraine, the US, and NATO are expanding directly on Russia’s doorstep, threatening Russia’s national security and the lives of Russian citizens.” Correspondingly, Russia had merely “taken necessary measures.”
So the mutual assurance between Xi and Putin at the SCO meeting in Samarkand was not even necessary. That is why it is important not to be too blinded by Xi’s pictures with Putin. They hide how Xi’s first foreign visit since the Covid pandemic should be interpreted
After almost 1,000 days of self-isolation, Xi chose Kazakhstan as the first stop on Wednesday. There, a hastily deleted Telegram post by Dmitry Medvedev had recently caused a great stir when the former Russian President suggested that Moscow should turn its attention to the fate of northern Kazakhstan after Ukraine.
Only in this context should Xi’s words be understood, which he chose to address President Kassym-Shomart Tokayev in Kazakhstan’s capital Nur-Sultan on Wednesday: “Regardless of changes in the international situation, we will continue to resolutely support Kazakhstan in protecting its independence, sovereignty, and territorial integrity.” China will categorically oppose interference by any forces in the country’s internal affairs, he said. “This is a subtle, yet very clear warning to Putin,” Seiwert believes.
Because while China is expanding its influence in Central Asia, Moscow has a hard time gaining support within the SCO for its aggressive actions. In 2008, for example, then-President Dmitry Medvedev tried to persuade the SCO states at the summit in Dushanbe to support Russia’s invasion of Georgia. Medvedev’s plan failed – not least because China feared that the secession of Abkhazia and South Ossetia would set a precedent for Taiwan’s secession from China.
The power-political imbalance between China and Russia is becoming clear on more and more levels. And Xi is a fierce power politician who understands only too well how to exploit his country’s advantages over Russia.
This trip once again impressively shows that, on a tactical level, Xi seeks to close ranks with Putin – against the US and the growing economic pressure from the West. Rhetorically, he expresses understanding for Russia’s attack, but at the same time adheres to Western sanctions. Xi does not want to enter into a firm entente with Russia. On a strategic level, he wants to retain access to the global market and, despite all the dissonance, not completely sever ties with the West.
Ms. Brantner, at the start of their time in office, the Greens announced a turning point for Germany’s China policy in view of an increasingly aggressive leadership in Beijing. What specifically are you doing differently?
Franziska Brantner: First, we need to analyze exactly what has changed on the Chinese side in recent years. We need an accurate picture of the country’s political and economic development to form the foundation of our policy. Second, we have recently experienced how painful overdependence on a single country can be and how necessary diversification is for our economy. We need to turn our attention back to the entire world. This does not mean that we will completely decouple ourselves from China. However, the changed global situation requires a new assessment.
Where exactly in China’s policy would you say: It can’t go on like this.
We must finally take a realistic look at the country. It shouldn’t just be about short-term gains, but about a realistic assessment of the opportunities and risks. When I see how strategically the country has positioned itself in terms of economic policy, I have to say that I have a lot of respect for it. It has developed from the world’s workbench into a highly innovative nation. The Chinese leadership makes no secret of its plans and the goals it wants to achieve by which year. We are now also positioning ourselves strategically. To achieve the balance between competitor, partner, and rival that the EU Commission has set out and that we have also set out in the coalition agreement, we should also draw up strategic plans in areas such as technological development, infrastructure expansion, and access to raw materials.
In dealings with China, the rivalry is increasing. Many fear another major crisis in the Taiwan conflict like the one in Ukraine – except that the German economy is much more closely intertwined with China than with Russia.
China has never been a liberal democracy. Nevertheless, the system question is more important than it was ten years ago because Chinese policy has changed significantly, both internally and externally. What direction the leadership will take after the major party congress in October remains to be seen. In some sectors, we are highly dependent on imports and exports. These must be consistently reduced through diversification. In addition, greater attention must be paid to the human rights situation. At the same time, we have a clear interest in cooperating with China on climate protection. Beijing is a key player in the international climate negotiations. The country has had terrible droughts and floods this summer.
Your ministry wants to overturn state investment guarantees for German companies operating in China. That is a clear signal.
We are not overturning anything, but are examining it closely. If there is clear evidence that forced labor is present in a region where German companies are producing, there will be no state investment guarantees.
You are talking about the VW plant in Xinjiang.
VW is the specific case where we no longer give these investment guarantees. The report by UN Human Rights Commissioner Bachelet a few minutes before her term ended was clear: human rights violations are taking place in the Xinjiang region. And we, as the German government, cannot pretend that we don’t know anything about it.
The question is what type of investments by German companies will still be supported by the German government.
If we as a government want German companies to diversify more, we should do the same. And we should also do that with our funding instruments. This does not mean that German companies should withdraw completely from the Chinese market. But in certain key areas, some of them should become less dependent. But this diversification will not happen overnight.
Do you have the impression that the German industry has understood how risky overdependence on China can be? Direct investment by Germans in China has risen to a new record level. BASF alone wants to invest ten billion euros in a new plant.
Our companies know that innovation must also take place in our country if we are to keep pace internationally. We as a government will therefore improve the framework for innovation where necessary. At the same time, many have seen in recent months how high the costs of fragile supply chains are and are working to reduce dependencies. These are our big tasks: Promote innovation here at home, clearly point out the risks in China, and support diversification. This will make us more resilient as an economy and also secure our prosperity in the long term.
How do you, as the federal government, intend to support this politically?
We are intensively driving forward a new, fair, and free trade policy. We are developing a new raw materials strategy specifically focused on diversification, the circular economy, and sustainable mining in our country and providing appropriate incentives. But in the end, companies invest. That’s the advantage of democracy and a free market economy, that companies can decide for themselves where and how much they invest. I wouldn’t want to live in a country where the state permanently dictates to companies what and where to produce.
That is easier said than done if this does not apply in reverse. Chinese companies have a free hand in Europe. European companies in China do not but are clearly disadvantaged compared to domestic suppliers regarding large orders.
That’s why we’ve had investment screening for some time, i.e. taking a close look at where foreign investments are headed. In addition, there is now also the regulation on third-country subsidies that distort the internal market, with which we can de facto identify distortions of competition at an early stage and react accordingly. In other words, a subsidy check that is not only for state support from European governments but also from foreign governments. In this way, we want to create a stronger level playing field.
To keep up with China technologically and in the world markets, do we need our own industrial policy?
We have had one for a long time, and I doubt that there was ever no industrial policy. Perhaps it wasn’t called this way or not set up strategically. My impression is that many people know how important government funding can be, especially for research and innovation, but also for market ramp-ups, especially at the European level. I know of only a few people who would fundamentally question this.
Not even with your coalition partner, the FDP?
We work well with the FDP on these issues.
The industry sees the obligation on politicians: The Federation of German Industries (BDI) urgently needs new trade agreements to tap into alternative procurement and target markets.
The BDI is right: Only by turning to the world as a whole will we succeed and secure our wealth. But this must be done fairly and sustainably. We are in a rivalry with China, and the other countries are asking: What is our benefit if we cooperate with Europe? They don’t want to be mere raw material suppliers but to retain a larger share of the value added and also protect their environment. The water issue, for example, is very relevant in this context. This has changed compared to 20 or 30 years ago.
Franziska Brantner has been Parliamentary State Secretary to the Federal Minister for Economic Affairs and Climate Protection under Federal Economics Minister Robert Habeck since December 2021. The 43-year-old has also been a Green Party member of the German Bundestag since 201Before to that, she was a member of the EU Parliament from 2009 to 2013.
Several German business associations have been displeased with the Ministry of Economics’ plans to take a tougher line on trade policy with China. Cutting back on instruments such as state investment and export guarantees or trade fair subsidies for China would hinder many companies’ business with China.
“Government support and protection for German companies’ business in China must be maintained as a matter of principle,” demanded Friedolin Strack, Chief Executive of the Asia-Pacific Committee (APA) of German business. He said, the APA also supports the diversification of sales and procurement markets in Asia. “However, the goal must not be a withdrawal from China, but rather the additional development of further growth markets in Asia and other regions of the world.” He stated that expanding foreign trade promotion would be more necessary to achieve this.
Criticism also came from the Head of Foreign Trade at the Association of German Chambers of Commerce and Industry (DIHK), Volker Treier: “The internationally active German economy is currently massively affected by supply chain disruptions and is struggling with immensely increased prices for raw materials and intermediate products in some cases. In this phase, a strategic move away from our largest trading partner would be another bitter blow to our foreign trade.”
Around 5,000 German companies are active in China. The Ministry of Economics and the Ministry of Foreign Affairs are urging a rougher course toward China, citing human rights abuses and the danger of becoming too dependent on the People’s Republic (China.Table reported). jul/rtr
Taiwan is expected to increase its semiconductor exports by 20 percent this year, reports the South China Morning Post. The reason is high demand, which is also influenced by concerns about further supply chain problems, among other factors, it said. The Semi Taiwan industry association estimates the industry’s expected revenue for 2022 at €157.4 billion.
As production increases, so does the demand for raw materials. According to Semi Taiwan, Taiwan’s chip industry could become the world’s top buyer of raw materials for the second year in a row this year, accounting for 23 percent of the global market, ahead of China at 19 percent and the US at 6.4 percent.
Increased demand for computers and cell phones in the Covid years 2020 and 2021 and disrupted supply chains led to chip supply shortages. Taiwan is the largest exporter of semiconductors – 60 percent of the world’s computer chips are produced on the island.
To reduce the dependence of domestic industries on chips from Taiwan, the EU, and the USA, among others, want to focus more on their own development and research as well as the establishment of production facilities. Talks include the construction of a factory by Taiwanese chip giant TSMC in the EU. (China.Table reported) jul
The European Parliament has called on EU member states to follow Lithuania’s example and open trade offices in Taipei. EU countries should generally strengthen trade with Taiwan, MEPs demanded in a joint text on Thursday. The parliamentarians thus backed Lithuania. The latter’s plans for a “Taiwan trade office” had caused outrage in Beijing – also because “Taipei” did not appear in the name as usual. According to media reports, the Lithuanian trade office has already started its work, the head has already entered the country, and has been released from quarantine, but the office itself has not opened.
The EU MEPs called on Beijing to “revoke its unjustified sanctions against Lithuanian officials” and lift trade restrictions against the Baltic state. EU parliamentarians also reiterated their call to change the name of the European Economic and Trade Office in Taiwan to the “European Union Office in Taiwan.” This appeal from the European Parliament already existed in a report on Taiwan last October.
In the resolution adopted on Thursday, MEPs also condemned China’s military action in the Taiwan Strait, the region’s main sea lane. The status quo should not be changed unilaterally, the text said. The resolutions from the European Parliament are positions of MEPs and not binding recommendations for action to the EU Commission and EU Council. ari
The US coffee house chain Starbucks wants to make China its most important market by 2025, reports the news magazine Caixin. In the next three years, 3,000 new stores are to be added. This would mean 9,000 Starbucks cafés in China – more than in the USA. Worldwide, 10,000 new cafés are planned over the same period.
According to data from market research firm Euromonitor, Starbucks holds the majority of the coffee and tea house market in China, with 36.4 percent. Its largest Chinese competitor, Luckin Coffee, operates more stores but makes less revenue. In China, Starbucks also uses online sales and delivery services in addition to café sales (China.Table reported). The company claims to employ 5,000 delivery drivers and plans to double their number in the next three years. The Seattle-based coffee house chain opened its first store in China in Beijing in 1999. Jul
Beijing has approved the construction of four more nuclear power reactors. Permission for the second construction phase of the Zhangzhou nuclear power plant in southeast China’s coastal Fujian province and the first phase of the Lianjiang nuclear power plant in southern China’s Guangdong province was granted at a meeting of China’s State Council, confirmed an official release on the council meeting.
According to the document, the additional reactors are expected to improve energy security and promote a green transition. The release adds, that the construction and operation of the nuclear plants would have to be strictly guarded to ensure safety. The People’s Republic has already emerged as one of the largest producers of nuclear power. In the last thirty years, China has built 54 reactors, with 20 more under construction (China.Table reported). Dozens of new reactors are to be built in the coming years – but China is currently having problems implementing all the planned projects to make itself less dependent on climate-damaging coal (China.Table reported). ari
The US is open about most of its diplomatic state secrets. After 25 years, they are declassified and disclosed. That includes the historic 1972 visit to China by US President Richard Nixon to pay his respects to China’s Mao.
Recently, while doing some online research, I came across a memorandum stamped “Top Secret / Sensitive.” It shows how it all began. The author of the 27-page document was Nixon’s national security adviser, Henry Kissinger. On July 14, 1971, immediately after returning from China, he wrote to his president. Unbeknownst to him, he set up Nixon’s planned trip to China to meet with Premier Zhou Enlai in Beijing from July 9 to 11.
The background to this is known today, but what is less known, is how Kissinger managed to make the visit palatable to his president in advance: Kissinger praised China’s cuisine. His report reads as if he had also been on the road as a taster.
The document is probably the only secret dossier in the world in which food is mentioned throughout. On the day of arrival, he notes: “Dinner with 15 or so dishes.” The next day, he has Peking duck for lunch. “The four and a half hours of talks with Zhou Enlai,” Kissinger writes, and then reaches for the appropriate English expression, were “sandwiched around a one and a half hour roast duck lunch.” The duck eased tensions. Earlier, his consultations with the Prime Minister had become bogged down because the latter refused to stop slandering US foreign policy. Kissinger wanted to counter “brusque” and began rebutting China’s tirades point by point, “when Zhou stopped me after the first point, saying the duck would get cold. At lunch, the mood changed for the better.” And after yet another lunch, Kissinger notes after 48 hours, “All tension was gone.”
China’s Premier left nothing to chance in Beijing, which was still amidst its devastating Cultural Revolution in 1971. He single-handedly placed the crispy skin of the wood-roasted Peking duck, rolled into thin dough patties, with the aromatic sauce, cucumber, and spring onions, on Kissinger’s plate, ready to eat. And so, Zhou’s “Peking duck diplomacy” (烤鸭外交) was born.
The wording of his conclusion in the secret dossier reveals just how impressionable the US emissary was. It reads as if a restaurant critic had taken over: “These 48 hours in China, and my extensive discussions with Zhou, in particular, had all the flavor, texture, variety, and delicacy of a Chinese banquet.” He compares his political discussions to a feast: “Our ‘feast’ consisted of many courses, some sweet and some sour…It was a total experience…as after all good Chinese meals leave you very satisfied but not at all stuffed.”
When President Nixon finally arrived, Beijing pulled out all the culinary stops, a 2019 report on the Communist People’s Daily’s online site first revealed. Zhou also rolled the Peking duck for Nixon, topping off a 22-course banquet (ten more than Kissinger’s). Among them were “nine appetizers, six dishes, and seven desserts.” Ingredients were flown in from all parts of China. Even Mao Zedong supported the frenzy of indulgence. During their visit, he sent one of his best chefs to serve three particularly exquisite dishes to the Nixon couple.
Mao had already tested this strategy with Kissinger when he visited Beijing twice in advance in 1971 to prepare for the Nixon trip. Mao hired his personal chef Yu Cun (于存). I interviewed the chef in 1986, back then as a correspondent for the German newspaper, Frankfurter Rundschau. He proudly reported how he prepared Mao’s favorite dishes for Kissinger, including a dish called “double-roasted spicy pork belly.” (回锅肉). Kissinger must have found its taste so irresistibly that, to Yu’s delight (and to the dismay of protocol), he immediately asked for seconds at lunch. Yu also cooked for other illustrious state guests on Mao’s behalf, including Japan’s Prime Minister Kakuei Tanaka, who sealed diplomatic relations in 1972. Yu’s cooking was a success, “They all ate too much.”
“China’s food culture is our real soft power,” Master Chef Liu Guangwei (刘广伟) told me in Beijing. “If the stomach of the foreign guest is satisfied, it is good for Beijing’s image. That, in turn, also helps international relations.”
I met the now 65-year-old in late 2018 at his “Research Institute of Far Eastern Culinary Specialties,” where he is searching for answers to the question he once asked his mother when he was a child. “How many cuisines are there in China? How many dishes?” Liu, who learned his craft in a provincial kitchen and later founded a cooking school and his institute, contradicts the traditional theory about eight major cooking schools (八大菜系). After 40 years of research in all parts of China, he published his discovery in 2018, which he calls “The 34-4 System of Chinese Dishes.” He counts 34 cooking schools in Greater China, which he classifies fourfold according to origin and distribution, preparation, ingredients, and cooking schools. China’s cuisine is “more diverse than any of us knew.”
Liu identified 30,000 dishes and recorded all their specific characteristics in a 19-digit formula, including, for example, whether the dishes belonged to the imperial, temple, or folk cuisine. “I gave each dish its digital ID,” he said. Liu also tracked down some 10,000 ingredients, 100 spices, 200 flavors, and 40 different ways to prepare them. His findings on China’s cuisine, which he calls shixue (食学), the doctrine of food, were also published in Taiwan, just in an expanded new edition.
It is high time, to make the promotion of Chinese cuisine a “national strategy” abroad as well with government support, the chef urges. Although he estimates that there are 300,000 Chinese restaurants around the world, they are in crisis (as is often the case with domestic cuisine). They are “fragmented, small, and weak.”
Even China’s republic founder, Sun Yat-sen, called China’s food “our real calling card” back in 1911. In his “Strategies for Nation Building” (建国方略) in 1918, he wrote: “In the evolution of modern civilization, China, which is otherwise backward and imperfect in everything, has yet not been surpassed by any nation in the production of a wide variety of dishes. In terms of their preparation, these surpass the dishes of European countries.”
Even Mao Zedong once agreed: “China’s two great contributions to the world are China’s medicine and China’s food.” (中国对世界的两大贡献,一个是中药,一个就是中国菜.)
His successors today seem reluctant to recognize the value of Chinese food as soft power in the service of the country. However, even Party newspapers now write, “In the new era, we must take China’s cuisine as a mediating medium (以食为媒) to enhance China’s cultural soft power and global influence.”
But in an 18-point offensive adopted in early 2017 by the two offices of the Central Committee and State Council to promote traditional culture globally, China’s cuisine appears only in item 14, and is part of a bulleted list: “We support the intention to go external with China’s medicine, cuisine, martial arts, classics, cultural relics, garden art, and traditional festivals.” “支持中华医药、中华烹饪、中华武术、中华典籍、中国文物、中国园林、中国节日等中华传统文化代表性项目走出去”.
Beijing prefers to use the merits of its food culture to polemicize to the outside world. Foreign Ministry spokeswoman Hua Chunying tweeted in August during the furor over US Speaker Pelosi’s Taiwan visit, “Baidu Maps show that there are 38 Shandong dumpling restaurants and 67 Shanxi noodle restaurants in Taipei. Palates don’t cheat. Taiwan has always been a part of China. The long-lost child will eventually return home.”
Her shot backfired. Beijing’s wolf warriors earned a ton of mockery and ridicule. One tweet wrote, “There are over 8,500 KFC restaurants in China. Palates don’t cheat. China has always been a part of Kentucky. The long-lost child will eventually return home.”
Kuno Knobloch has been General Manager for the China region at Erdrich Metal Forming Technology in Changzhou, Jiangsu, since the beginning of the month. Knobloch was previously Plant General Manager for Wirthwein AG in Kunshan for a good eight years.
Stefano Joseph founded the influencer marketing agency Breezy United in Taipei. The agency connects brands from the Asian region with content creators in the German market. Joseph was previously Regional Manager for Rhinoshield.
Is something changing in your organization? Why not send a note for our staff section to heads@table.media!
They can’t go back to their school yet, but classes are still taking place: In Shimian County, Sichuan Province, students are cramming in a gymnasium after a 6.8-magnitude earthquake struck their home on Sept. 5. Several people were killed and dozens of buildings were destroyed.
To instill stability and positive energy in a chaotic world: These words by Xi Jinping sound like irony at the meeting with his “old friend” Vladimir Putin in Uzbekistan. But the Shanghai Cooperation Organization (SCO) summit in Samarkand shows much more than just solidarity between China and Russia, analyzes Michael Radunski. It also clarifies how China is expanding its power in Central Asia – in Russia’s former sphere of influence, of all places.
China’s growing influence is currently also a concern for the German government. In an interview with Table.Media, Franziska Brantner, State Secretary for Economic Affairs, is in favor of not granting investment guarantees if ethical or labor standards are not reached in production in a region. However, she does not want German companies to withdraw entirely from the Chinese market. Instead, Brantner calls for more German innovation, greater market diversification, and a clearer awareness of risk on the part of companies. German policy toward China must understand how the country has changed in recent years. Otherwise, there is a risk of dangerous dependencies, warns Brantner.
Today’s column by Johnny Erling is about the high art of “Peking duck diplomacy.” During his research, he came across a US secret document dating back to 1971 that makes your mouth water. In it, Henry Kissinger, then National Security Advisor, tells his boss Richard Nixon about a preparatory trip for Nixon’s state visit to China – and has nothing but high praise for Chinese cuisine. With a Peking duck, garnished with fine cucumber strips and a delicious sauce, China’s premier Zhou Enlai quickly won the heart of the envoys. Mao’s chef even personally cooked for Nixon during his trip in 1972. The way to a diplomat’s heart is through his stomach, after all.
China’s President is back on the international stage. At the Shanghai Cooperation Organization (SCO) summit in Uzbekistan, Xi Jinping met with the heads of state of India, Pakistan, Iran, and Russia.
However, the talks with Russian President Vladimir Putin were highly anticipated. In Samarkand, the two leaders eloquently assured each other of their mutual support. Xi called Putin an “old friend” and announced that China would continue to cooperate closely with Russia. China will work with Russia to “instill stability and positive energy in a chaotic world.”
Putin, in turn, was very pleased. “We highly value the balanced position of our Chinese friends when it comes to the Ukraine crisis.” Putin also admitted that Xi had raised questions and concerns about the situation in Ukraine with him during the talks. Regarding Taiwan, he promised that Russia would support China’s “one-country policy” and rejected the West’s provocations. This refers, among other things, to the Taiwan visit of Nancy Pelosi, Speaker of the US House of Representatives.
At the same time, the Russian Defense Ministry announced joint patrols of the naval forces of the two countries in the Pacific. These patrols were intended to “strengthen naval cooperation between the Russian Federation and the People’s Republic of China, maintain peace and stability in the Asia-Pacific region,” monitor the coastline, and protect sites of economic value.
In any case, Xi and Putin are using their meeting in Samarkand to show that Russia and China are far less isolated internationally than many Western politicians proclaim – and the two-day SCO summit came at a perfect time for them to do so.
The SCO exemplifies how China is preparing to establish alternative structures to Western-dominated institutions: The SCO, founded in 2001, includes China, Russia, India, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, and Uzbekistan. Neither Western Europeans nor Americans are at the table, but countries such as Belarus (as an observer state) and Iran, which will soon join the SCO, were announced in Samarkand.
“The SCO currently serves China and Russia as an alternative to the existing US-dominated institutions of international politics,” explains Eva Seiwert, research associate at the Friedrich Alexander University of Erlangen-Nuremberg and associate research fellow at the OSCE Academy in Bishkek, in an interview with China.Table. This became particularly clear in 2018, when Xi invited SCO leaders to the eastern Chinese port city of Qingdao, while the great powers of the West were meeting in La Malbaie, Canada, for the G7 summit.
And this is precisely the true focus of Xi’s first foreign visit. The Central Asia region is of great importance to China. It was in Kazakhstan where Xi unveiled his biggest foreign policy project in September 2013: the Belt and Road Initiative. Since then, China has invested massively in the region – financially in countless infrastructure projects, and diplomatically in building good relations with individual states. “China is doing very well to keep expanding its influence in Russia’s former sphere of influence through the SCO,” Seiwert says.
On Thursday, China and Uzbekistan signed trade and investment agreements worth $15 billion. And Iran’s accession to the SCO, announced in Samarkand, can certainly be seen as a success for Xi. The China-dominated SCO thus gains an important geostrategic player.
Meanwhile, former Soviet republics such as Uzbekistan and Kazakhstan feel increasingly threatened by the Russian attack on Ukraine and are distancing themselves from Russia. Kazakhstan in particular has recently taken a clear stance against the Russian incursion.
This is in stark contrast to China. Last week, Li Zhanshu, a Communist Party’s Standing Committee member and thus one of China’s most powerful nine men, traveled to Russia. There, he explicitly expressed China’s understanding of Russia’s incursion: “Ukraine, the US, and NATO are expanding directly on Russia’s doorstep, threatening Russia’s national security and the lives of Russian citizens.” Correspondingly, Russia had merely “taken necessary measures.”
So the mutual assurance between Xi and Putin at the SCO meeting in Samarkand was not even necessary. That is why it is important not to be too blinded by Xi’s pictures with Putin. They hide how Xi’s first foreign visit since the Covid pandemic should be interpreted
After almost 1,000 days of self-isolation, Xi chose Kazakhstan as the first stop on Wednesday. There, a hastily deleted Telegram post by Dmitry Medvedev had recently caused a great stir when the former Russian President suggested that Moscow should turn its attention to the fate of northern Kazakhstan after Ukraine.
Only in this context should Xi’s words be understood, which he chose to address President Kassym-Shomart Tokayev in Kazakhstan’s capital Nur-Sultan on Wednesday: “Regardless of changes in the international situation, we will continue to resolutely support Kazakhstan in protecting its independence, sovereignty, and territorial integrity.” China will categorically oppose interference by any forces in the country’s internal affairs, he said. “This is a subtle, yet very clear warning to Putin,” Seiwert believes.
Because while China is expanding its influence in Central Asia, Moscow has a hard time gaining support within the SCO for its aggressive actions. In 2008, for example, then-President Dmitry Medvedev tried to persuade the SCO states at the summit in Dushanbe to support Russia’s invasion of Georgia. Medvedev’s plan failed – not least because China feared that the secession of Abkhazia and South Ossetia would set a precedent for Taiwan’s secession from China.
The power-political imbalance between China and Russia is becoming clear on more and more levels. And Xi is a fierce power politician who understands only too well how to exploit his country’s advantages over Russia.
This trip once again impressively shows that, on a tactical level, Xi seeks to close ranks with Putin – against the US and the growing economic pressure from the West. Rhetorically, he expresses understanding for Russia’s attack, but at the same time adheres to Western sanctions. Xi does not want to enter into a firm entente with Russia. On a strategic level, he wants to retain access to the global market and, despite all the dissonance, not completely sever ties with the West.
Ms. Brantner, at the start of their time in office, the Greens announced a turning point for Germany’s China policy in view of an increasingly aggressive leadership in Beijing. What specifically are you doing differently?
Franziska Brantner: First, we need to analyze exactly what has changed on the Chinese side in recent years. We need an accurate picture of the country’s political and economic development to form the foundation of our policy. Second, we have recently experienced how painful overdependence on a single country can be and how necessary diversification is for our economy. We need to turn our attention back to the entire world. This does not mean that we will completely decouple ourselves from China. However, the changed global situation requires a new assessment.
Where exactly in China’s policy would you say: It can’t go on like this.
We must finally take a realistic look at the country. It shouldn’t just be about short-term gains, but about a realistic assessment of the opportunities and risks. When I see how strategically the country has positioned itself in terms of economic policy, I have to say that I have a lot of respect for it. It has developed from the world’s workbench into a highly innovative nation. The Chinese leadership makes no secret of its plans and the goals it wants to achieve by which year. We are now also positioning ourselves strategically. To achieve the balance between competitor, partner, and rival that the EU Commission has set out and that we have also set out in the coalition agreement, we should also draw up strategic plans in areas such as technological development, infrastructure expansion, and access to raw materials.
In dealings with China, the rivalry is increasing. Many fear another major crisis in the Taiwan conflict like the one in Ukraine – except that the German economy is much more closely intertwined with China than with Russia.
China has never been a liberal democracy. Nevertheless, the system question is more important than it was ten years ago because Chinese policy has changed significantly, both internally and externally. What direction the leadership will take after the major party congress in October remains to be seen. In some sectors, we are highly dependent on imports and exports. These must be consistently reduced through diversification. In addition, greater attention must be paid to the human rights situation. At the same time, we have a clear interest in cooperating with China on climate protection. Beijing is a key player in the international climate negotiations. The country has had terrible droughts and floods this summer.
Your ministry wants to overturn state investment guarantees for German companies operating in China. That is a clear signal.
We are not overturning anything, but are examining it closely. If there is clear evidence that forced labor is present in a region where German companies are producing, there will be no state investment guarantees.
You are talking about the VW plant in Xinjiang.
VW is the specific case where we no longer give these investment guarantees. The report by UN Human Rights Commissioner Bachelet a few minutes before her term ended was clear: human rights violations are taking place in the Xinjiang region. And we, as the German government, cannot pretend that we don’t know anything about it.
The question is what type of investments by German companies will still be supported by the German government.
If we as a government want German companies to diversify more, we should do the same. And we should also do that with our funding instruments. This does not mean that German companies should withdraw completely from the Chinese market. But in certain key areas, some of them should become less dependent. But this diversification will not happen overnight.
Do you have the impression that the German industry has understood how risky overdependence on China can be? Direct investment by Germans in China has risen to a new record level. BASF alone wants to invest ten billion euros in a new plant.
Our companies know that innovation must also take place in our country if we are to keep pace internationally. We as a government will therefore improve the framework for innovation where necessary. At the same time, many have seen in recent months how high the costs of fragile supply chains are and are working to reduce dependencies. These are our big tasks: Promote innovation here at home, clearly point out the risks in China, and support diversification. This will make us more resilient as an economy and also secure our prosperity in the long term.
How do you, as the federal government, intend to support this politically?
We are intensively driving forward a new, fair, and free trade policy. We are developing a new raw materials strategy specifically focused on diversification, the circular economy, and sustainable mining in our country and providing appropriate incentives. But in the end, companies invest. That’s the advantage of democracy and a free market economy, that companies can decide for themselves where and how much they invest. I wouldn’t want to live in a country where the state permanently dictates to companies what and where to produce.
That is easier said than done if this does not apply in reverse. Chinese companies have a free hand in Europe. European companies in China do not but are clearly disadvantaged compared to domestic suppliers regarding large orders.
That’s why we’ve had investment screening for some time, i.e. taking a close look at where foreign investments are headed. In addition, there is now also the regulation on third-country subsidies that distort the internal market, with which we can de facto identify distortions of competition at an early stage and react accordingly. In other words, a subsidy check that is not only for state support from European governments but also from foreign governments. In this way, we want to create a stronger level playing field.
To keep up with China technologically and in the world markets, do we need our own industrial policy?
We have had one for a long time, and I doubt that there was ever no industrial policy. Perhaps it wasn’t called this way or not set up strategically. My impression is that many people know how important government funding can be, especially for research and innovation, but also for market ramp-ups, especially at the European level. I know of only a few people who would fundamentally question this.
Not even with your coalition partner, the FDP?
We work well with the FDP on these issues.
The industry sees the obligation on politicians: The Federation of German Industries (BDI) urgently needs new trade agreements to tap into alternative procurement and target markets.
The BDI is right: Only by turning to the world as a whole will we succeed and secure our wealth. But this must be done fairly and sustainably. We are in a rivalry with China, and the other countries are asking: What is our benefit if we cooperate with Europe? They don’t want to be mere raw material suppliers but to retain a larger share of the value added and also protect their environment. The water issue, for example, is very relevant in this context. This has changed compared to 20 or 30 years ago.
Franziska Brantner has been Parliamentary State Secretary to the Federal Minister for Economic Affairs and Climate Protection under Federal Economics Minister Robert Habeck since December 2021. The 43-year-old has also been a Green Party member of the German Bundestag since 201Before to that, she was a member of the EU Parliament from 2009 to 2013.
Several German business associations have been displeased with the Ministry of Economics’ plans to take a tougher line on trade policy with China. Cutting back on instruments such as state investment and export guarantees or trade fair subsidies for China would hinder many companies’ business with China.
“Government support and protection for German companies’ business in China must be maintained as a matter of principle,” demanded Friedolin Strack, Chief Executive of the Asia-Pacific Committee (APA) of German business. He said, the APA also supports the diversification of sales and procurement markets in Asia. “However, the goal must not be a withdrawal from China, but rather the additional development of further growth markets in Asia and other regions of the world.” He stated that expanding foreign trade promotion would be more necessary to achieve this.
Criticism also came from the Head of Foreign Trade at the Association of German Chambers of Commerce and Industry (DIHK), Volker Treier: “The internationally active German economy is currently massively affected by supply chain disruptions and is struggling with immensely increased prices for raw materials and intermediate products in some cases. In this phase, a strategic move away from our largest trading partner would be another bitter blow to our foreign trade.”
Around 5,000 German companies are active in China. The Ministry of Economics and the Ministry of Foreign Affairs are urging a rougher course toward China, citing human rights abuses and the danger of becoming too dependent on the People’s Republic (China.Table reported). jul/rtr
Taiwan is expected to increase its semiconductor exports by 20 percent this year, reports the South China Morning Post. The reason is high demand, which is also influenced by concerns about further supply chain problems, among other factors, it said. The Semi Taiwan industry association estimates the industry’s expected revenue for 2022 at €157.4 billion.
As production increases, so does the demand for raw materials. According to Semi Taiwan, Taiwan’s chip industry could become the world’s top buyer of raw materials for the second year in a row this year, accounting for 23 percent of the global market, ahead of China at 19 percent and the US at 6.4 percent.
Increased demand for computers and cell phones in the Covid years 2020 and 2021 and disrupted supply chains led to chip supply shortages. Taiwan is the largest exporter of semiconductors – 60 percent of the world’s computer chips are produced on the island.
To reduce the dependence of domestic industries on chips from Taiwan, the EU, and the USA, among others, want to focus more on their own development and research as well as the establishment of production facilities. Talks include the construction of a factory by Taiwanese chip giant TSMC in the EU. (China.Table reported) jul
The European Parliament has called on EU member states to follow Lithuania’s example and open trade offices in Taipei. EU countries should generally strengthen trade with Taiwan, MEPs demanded in a joint text on Thursday. The parliamentarians thus backed Lithuania. The latter’s plans for a “Taiwan trade office” had caused outrage in Beijing – also because “Taipei” did not appear in the name as usual. According to media reports, the Lithuanian trade office has already started its work, the head has already entered the country, and has been released from quarantine, but the office itself has not opened.
The EU MEPs called on Beijing to “revoke its unjustified sanctions against Lithuanian officials” and lift trade restrictions against the Baltic state. EU parliamentarians also reiterated their call to change the name of the European Economic and Trade Office in Taiwan to the “European Union Office in Taiwan.” This appeal from the European Parliament already existed in a report on Taiwan last October.
In the resolution adopted on Thursday, MEPs also condemned China’s military action in the Taiwan Strait, the region’s main sea lane. The status quo should not be changed unilaterally, the text said. The resolutions from the European Parliament are positions of MEPs and not binding recommendations for action to the EU Commission and EU Council. ari
The US coffee house chain Starbucks wants to make China its most important market by 2025, reports the news magazine Caixin. In the next three years, 3,000 new stores are to be added. This would mean 9,000 Starbucks cafés in China – more than in the USA. Worldwide, 10,000 new cafés are planned over the same period.
According to data from market research firm Euromonitor, Starbucks holds the majority of the coffee and tea house market in China, with 36.4 percent. Its largest Chinese competitor, Luckin Coffee, operates more stores but makes less revenue. In China, Starbucks also uses online sales and delivery services in addition to café sales (China.Table reported). The company claims to employ 5,000 delivery drivers and plans to double their number in the next three years. The Seattle-based coffee house chain opened its first store in China in Beijing in 1999. Jul
Beijing has approved the construction of four more nuclear power reactors. Permission for the second construction phase of the Zhangzhou nuclear power plant in southeast China’s coastal Fujian province and the first phase of the Lianjiang nuclear power plant in southern China’s Guangdong province was granted at a meeting of China’s State Council, confirmed an official release on the council meeting.
According to the document, the additional reactors are expected to improve energy security and promote a green transition. The release adds, that the construction and operation of the nuclear plants would have to be strictly guarded to ensure safety. The People’s Republic has already emerged as one of the largest producers of nuclear power. In the last thirty years, China has built 54 reactors, with 20 more under construction (China.Table reported). Dozens of new reactors are to be built in the coming years – but China is currently having problems implementing all the planned projects to make itself less dependent on climate-damaging coal (China.Table reported). ari
The US is open about most of its diplomatic state secrets. After 25 years, they are declassified and disclosed. That includes the historic 1972 visit to China by US President Richard Nixon to pay his respects to China’s Mao.
Recently, while doing some online research, I came across a memorandum stamped “Top Secret / Sensitive.” It shows how it all began. The author of the 27-page document was Nixon’s national security adviser, Henry Kissinger. On July 14, 1971, immediately after returning from China, he wrote to his president. Unbeknownst to him, he set up Nixon’s planned trip to China to meet with Premier Zhou Enlai in Beijing from July 9 to 11.
The background to this is known today, but what is less known, is how Kissinger managed to make the visit palatable to his president in advance: Kissinger praised China’s cuisine. His report reads as if he had also been on the road as a taster.
The document is probably the only secret dossier in the world in which food is mentioned throughout. On the day of arrival, he notes: “Dinner with 15 or so dishes.” The next day, he has Peking duck for lunch. “The four and a half hours of talks with Zhou Enlai,” Kissinger writes, and then reaches for the appropriate English expression, were “sandwiched around a one and a half hour roast duck lunch.” The duck eased tensions. Earlier, his consultations with the Prime Minister had become bogged down because the latter refused to stop slandering US foreign policy. Kissinger wanted to counter “brusque” and began rebutting China’s tirades point by point, “when Zhou stopped me after the first point, saying the duck would get cold. At lunch, the mood changed for the better.” And after yet another lunch, Kissinger notes after 48 hours, “All tension was gone.”
China’s Premier left nothing to chance in Beijing, which was still amidst its devastating Cultural Revolution in 1971. He single-handedly placed the crispy skin of the wood-roasted Peking duck, rolled into thin dough patties, with the aromatic sauce, cucumber, and spring onions, on Kissinger’s plate, ready to eat. And so, Zhou’s “Peking duck diplomacy” (烤鸭外交) was born.
The wording of his conclusion in the secret dossier reveals just how impressionable the US emissary was. It reads as if a restaurant critic had taken over: “These 48 hours in China, and my extensive discussions with Zhou, in particular, had all the flavor, texture, variety, and delicacy of a Chinese banquet.” He compares his political discussions to a feast: “Our ‘feast’ consisted of many courses, some sweet and some sour…It was a total experience…as after all good Chinese meals leave you very satisfied but not at all stuffed.”
When President Nixon finally arrived, Beijing pulled out all the culinary stops, a 2019 report on the Communist People’s Daily’s online site first revealed. Zhou also rolled the Peking duck for Nixon, topping off a 22-course banquet (ten more than Kissinger’s). Among them were “nine appetizers, six dishes, and seven desserts.” Ingredients were flown in from all parts of China. Even Mao Zedong supported the frenzy of indulgence. During their visit, he sent one of his best chefs to serve three particularly exquisite dishes to the Nixon couple.
Mao had already tested this strategy with Kissinger when he visited Beijing twice in advance in 1971 to prepare for the Nixon trip. Mao hired his personal chef Yu Cun (于存). I interviewed the chef in 1986, back then as a correspondent for the German newspaper, Frankfurter Rundschau. He proudly reported how he prepared Mao’s favorite dishes for Kissinger, including a dish called “double-roasted spicy pork belly.” (回锅肉). Kissinger must have found its taste so irresistibly that, to Yu’s delight (and to the dismay of protocol), he immediately asked for seconds at lunch. Yu also cooked for other illustrious state guests on Mao’s behalf, including Japan’s Prime Minister Kakuei Tanaka, who sealed diplomatic relations in 1972. Yu’s cooking was a success, “They all ate too much.”
“China’s food culture is our real soft power,” Master Chef Liu Guangwei (刘广伟) told me in Beijing. “If the stomach of the foreign guest is satisfied, it is good for Beijing’s image. That, in turn, also helps international relations.”
I met the now 65-year-old in late 2018 at his “Research Institute of Far Eastern Culinary Specialties,” where he is searching for answers to the question he once asked his mother when he was a child. “How many cuisines are there in China? How many dishes?” Liu, who learned his craft in a provincial kitchen and later founded a cooking school and his institute, contradicts the traditional theory about eight major cooking schools (八大菜系). After 40 years of research in all parts of China, he published his discovery in 2018, which he calls “The 34-4 System of Chinese Dishes.” He counts 34 cooking schools in Greater China, which he classifies fourfold according to origin and distribution, preparation, ingredients, and cooking schools. China’s cuisine is “more diverse than any of us knew.”
Liu identified 30,000 dishes and recorded all their specific characteristics in a 19-digit formula, including, for example, whether the dishes belonged to the imperial, temple, or folk cuisine. “I gave each dish its digital ID,” he said. Liu also tracked down some 10,000 ingredients, 100 spices, 200 flavors, and 40 different ways to prepare them. His findings on China’s cuisine, which he calls shixue (食学), the doctrine of food, were also published in Taiwan, just in an expanded new edition.
It is high time, to make the promotion of Chinese cuisine a “national strategy” abroad as well with government support, the chef urges. Although he estimates that there are 300,000 Chinese restaurants around the world, they are in crisis (as is often the case with domestic cuisine). They are “fragmented, small, and weak.”
Even China’s republic founder, Sun Yat-sen, called China’s food “our real calling card” back in 1911. In his “Strategies for Nation Building” (建国方略) in 1918, he wrote: “In the evolution of modern civilization, China, which is otherwise backward and imperfect in everything, has yet not been surpassed by any nation in the production of a wide variety of dishes. In terms of their preparation, these surpass the dishes of European countries.”
Even Mao Zedong once agreed: “China’s two great contributions to the world are China’s medicine and China’s food.” (中国对世界的两大贡献,一个是中药,一个就是中国菜.)
His successors today seem reluctant to recognize the value of Chinese food as soft power in the service of the country. However, even Party newspapers now write, “In the new era, we must take China’s cuisine as a mediating medium (以食为媒) to enhance China’s cultural soft power and global influence.”
But in an 18-point offensive adopted in early 2017 by the two offices of the Central Committee and State Council to promote traditional culture globally, China’s cuisine appears only in item 14, and is part of a bulleted list: “We support the intention to go external with China’s medicine, cuisine, martial arts, classics, cultural relics, garden art, and traditional festivals.” “支持中华医药、中华烹饪、中华武术、中华典籍、中国文物、中国园林、中国节日等中华传统文化代表性项目走出去”.
Beijing prefers to use the merits of its food culture to polemicize to the outside world. Foreign Ministry spokeswoman Hua Chunying tweeted in August during the furor over US Speaker Pelosi’s Taiwan visit, “Baidu Maps show that there are 38 Shandong dumpling restaurants and 67 Shanxi noodle restaurants in Taipei. Palates don’t cheat. Taiwan has always been a part of China. The long-lost child will eventually return home.”
Her shot backfired. Beijing’s wolf warriors earned a ton of mockery and ridicule. One tweet wrote, “There are over 8,500 KFC restaurants in China. Palates don’t cheat. China has always been a part of Kentucky. The long-lost child will eventually return home.”
Kuno Knobloch has been General Manager for the China region at Erdrich Metal Forming Technology in Changzhou, Jiangsu, since the beginning of the month. Knobloch was previously Plant General Manager for Wirthwein AG in Kunshan for a good eight years.
Stefano Joseph founded the influencer marketing agency Breezy United in Taipei. The agency connects brands from the Asian region with content creators in the German market. Joseph was previously Regional Manager for Rhinoshield.
Is something changing in your organization? Why not send a note for our staff section to heads@table.media!
They can’t go back to their school yet, but classes are still taking place: In Shimian County, Sichuan Province, students are cramming in a gymnasium after a 6.8-magnitude earthquake struck their home on Sept. 5. Several people were killed and dozens of buildings were destroyed.