Table.Briefing: China (English)

Universities scrutinize scientific collaborations + Results of the Third Plenum

Dear reader,

It was postponed for months, and now the Third Plenum of the Central Committee has ended. The counting has already begun: How often have the words “reform,” “development” or national security been mentioned? On Thursday, observers at home and abroad tried to deduce anything about the CCP’s future priorities from the meager communiqué. Does the frequent emphasis on national security indicate more control? The German economy will greatly depend on whether power politics or economic growth is the future focus. Finn Mayer-Kuckuk has analyzed the outcome of the important planning conference and at least recognizes the Chinese leadership’s interest in not letting the economy crash completely. Read his analysis to find out what else he found out.

“I don’t see the point. Africans will be your friends only when you give them money.” Or: “Has the government forgotten how many poor people China has?” This is how the Chinese public comments on China’s development aid on social media. Quite a contrast to the Western perception, which accuses China of luring poorer countries into a debt trap. Yes – which one is it? One thing is clear: China gives a lot – almost 80 billion euros annually. One of our authors from China looks at the social debate and the political goals that the aid is pursuing.

German research faces a dilemma: German universities seek exchange with international partners and students. However, no one wants to cooperate with organizations that support military developments in China. But how can scientists weigh up the risks and opportunities of scientific cooperation? It’s difficult – but important. Universities and researchers “have to be very careful” in all research fields that expand China’s military or surveillance potential, says Yannick Ringot from the HNC³ network in an interview with Table.Briefings. This initiative, to which the University of Hamburg belongs, pools China expertise in the Hanseatic city. Marcel Grzanna’s analysis shows what stricter screening procedures look like at various universities.

Your
Julia Fiedler
Image of Julia  Fiedler

Feature

Research: How German academia becomes more aware of risks

Uni Hamburg
The University of Hamburg now subjects foreign research inquiries to an in-depth review process.

China’s position in the Ukraine war has triggered a rethink in German academia. Ever since numerous pieces of evidence have emerged that Beijing is providing military support to its close friend and strategic partner Vladimir Putin, a number of collaborations between German universities and research institutes and Chinese institutions have been cast in a different light.

“The war in Ukraine has changed perceptions. We cannot deny that there is a rivalry alongside the partnership with China,” says Yannick Ringot, coordinator of the Hamburg Network on Compliance in Cooperation with China HNC³ at the University of Hamburg.

There is still a considerable need for knowledge and instructions in areas where an extensive exchange with Chinese partners was largely approved without hesitation just a few years ago. Scientists are faced with the dilemma of having to weigh up the risks and opportunities of cooperation. Ringot told Table Briefings that “researchers and universities have to be very careful” in all research fields that expand China’s military or surveillance potential.

‘Universities have a social responsibility’

The HNC³ network is funded by the German Federal Ministry of Education and Research and pools the China expertise of nine academic institutions in Hamburg. The central player in the network is the University of Hamburg. Earlier than others, it started to look closer at who it works with. The usual review of international cooperation requests was significantly intensified at the end of 2020. Since then, requests have been undergoing an in-depth review process.

The implementation of this detailed evaluation resulted from the “dynamic global political situation,” from which a systemic rivalry between democracies and autocracies has increasingly crystallized. “Our universities have a social responsibility. They cannot be allowed to help arm the Chinese military,” says Ringot. The procedure has already been adjusted in detail several times to increasingly take account of the risk potential. The frequent readjustments are symbolic of the deficits that existed in the examinations at German universities just a few years ago.

Opportunities overshadowed the risks for many years

Also because it is not always easy to say “no.” China offers generous research project funding, well-trained guest scientists and partner institutions with state-of-the-art equipment. For many years, the opportunities for cooperation outweighed the potential threats to Germany’s sovereignty, national security and freedom of research. But that has changed since.

“We are seeing a much greater awareness and concern, particularly in export control,” says Alicia Hennig, a business ethicist specializing in China from the International University Institute (IHI) Zittau at TU Dresden. This became clear at the German Federal Working Group on Export Controls and Science, where around 130 representatives from universities and research institutions debated how to deal with the risks and consequences of cooperation in mid-June. Hennig herself worked as a lecturer at a Chinese university for five years before she was no longer willing to abide by ideological boundaries in teaching out of consideration for her hosts, and left the country.

Screening procedure is country-independent

Within the working group, however, Hennig recognized “a lot of frustration that the German government does not play a central role in risk assessment for universities.” In its position paper on research safety in March 2024, the Federal Ministry of Education and Research (BMBF) announced plans to “actively support the review and (continued) development of corresponding guidelines and instruments by the scientific community” as part of its responsibilities. Despite this, universities are still forced to make the final decision.

The problem here is that many academics have little or no China expertise. They evaluate risks based on their personal values and experiences. They can neither classify the individual backgrounds of Chinese scientists nor identify the ties between partner institutions and the state arms industry or surveillance programs.

The University of Hamburg wants to close these gaps. Its in-depth examination procedure is not country-specific. Requests from other countries are also closely scrutinized, especially if they have autocratic structures. Nevertheless, requests for cooperation with Chinese partners initiate most of the procedures.

Ongoing project at the University of Hamburg terminated

The vast majority of the approximately 20 procedures examined to date involve STEM subjects. Most of them have been given the green light. In one case, however, an ongoing collaboration was terminated. The third-party-funded project in question focussed on machine learning and AI. When the application for the third phase began, several open and critical questions emerged, which, after extensive debate and consideration, spoke against a continuation.

The procedure takes time: After a classification based on the country list of the Academic Freedom Index (AFI), a subject-related classification by research areas with increased risk or export control relevance is performed, if necessary. If the criteria of the German Federal Office for Export Control also indicate a high risk, the review goes into detail. The university then obtains information from project managers and the assessments of a handful of departments, coordinates them with each other, holds consultations and finally drafts a proposal for the presidential board. This is where the final decision is made whether or not a cooperation will be established.

Specific information offered at the TU Munich

The TU Munich has also become cautious. “In recent years, we have noticed a high level of sensitivity as well as an increased need for consultation among our researchers with regard to international collaborations,” the university explains. China is a particular focus here. As part of its Global Engagement Principles developed in 2022, TU Darmstadt has set up a “China Roundtable,” which provides researchers with specific information and recommendations. On the one hand, this is intended to contribute to further awareness raising. On the other hand, the aim is to create opportunities for the best possible organization of scientific cooperation. In general, the guiding questions of the German Rectors’ Conference on cooperation with Chinese partners are used as a basis.

At the Free University of Berlin, an awareness-raising process is also being driven forward, primarily by the international and legal departments. An in-depth review process has been in a test phase since the beginning of the year. So far, applications for third-party funding have only received a recommendation or, “in the case of certain countries such as China,” the university administration has been able to request a review on its part. In addition, the Free University has set up a China advisory board to advise university management on cooperation with China.

Risks are far from over

Applications for third-party funding with China are reviewed by the international department – particularly by the country officers – after consultation with the research department. Here, too, the key questions are: Is there a risk of encroachment on academic freedom or violations of export control law?

Currently, the Free University’s research database lists six ongoing collaborations with China, all of which are fully funded by the European Union (Horizon), the German Academic Exchange Service (DAAD), the German Research Foundation (DFG) or other international organizations. In addition, there are two long-term projects with partial Chinese funding – the Center for German Studies, supported by Peking University, the Free University, and Humboldt University, which is funded by the DAAD and the three partners. China also funds the University’s Confucius Institute, “which operates separately from university teaching and primarily offers language courses and cultural events,” a statement from the university said.

These examples show that parts of the scientific community in Germany are no longer willing to accept Chinese cooperation inquiries at any price. Have the risks been averted? Not by a long shot, says business ethicist Hennig. “There has been significant progress in some areas of German academia. In other areas, it is still very difficult or there is a lack of will to counter the risks with suitable mechanisms.”

  • Universitäten

Third Plenary Session: These priorities emerge

Xi Jinping leads the row of cadres for the closing session of the Third Plenum (official photo from Thursday). Behind him are Li Qiang, Zhao Leji, Wang Huning, Cai Qi, Ding Xuexiang and Li Xi.

In its first communiqué after the end of the Third Plenum, the Central Committee of the Communist Party of China set out a timetable for the next interim economic targets. In addition, the public learns for the first time about the whereabouts of the deposed ministers, Qin Gang and Li Shangfu. The announcement also provides an initial indication of Xi Jinping’s priorities for the coming years.

  1. The current reform agenda is to be completed by 2029, the 80th anniversary of the founding of the People’s Republic, and
  2. The establishment of a “high-standard socialist market economy” is to be completed by 2035.

Incidentally, these dates indicate that Xi will probably not step down after his current third term of office. In 2029, he will already be in his fourth, and he is explicitly named as the leader under whose guidance the goals are to be achieved. Longer documents are expected on Friday, which will provide details, in particular, what goals are targeted.

The Central Committee is the most powerful body of the Communist Party and the sole ruling body in China. It only convenes seven times in a five-year period and sometimes makes far-reaching decisions. The Third Plenum of the Central Committee traditionally focuses on economic planning. The plenary session ended on Thursday. 264 members participated.

Lenient punishment for Qin Gang

According to the document, former Foreign Minister Qin Gang has resigned from the Central Committee. This suggests a friendly treatment of the ousted senior official: He was given the opportunity to resign instead of being expelled. As a loyal follower of Xi, he is apparently treated a little more gently even after he has fallen from grace.

Qin had been promoted to minister in record time and was obviously part of Xi’s inner circle. Qin Gang met with German Foreign Minister Annalena Baerbock twice, once in Beijing and once in Berlin. At the time, the frosty tone between the Foreign Minister and the Foreign Minister was particularly striking. Qin was well known in the West, as he had previously been spokesperson for the Foreign Ministry and ambassador to the USA.

Harsher punishment for Li Shangfu

While Qin was given the opportunity to resign, the general and ex-defense minister Li Shangfu was ousted from the Central Committee. Li’s promotion to minister in 2023 is said to have been thanks to his predecessor Wei Fenghe. Wei was also recently charged with corruption.

Unlike Qin, whose transgressions are still unknown today, there was probably nothing left to gloss over. Especially as it is Xi’s intention to keep the military clean. Moreover, Li was probably not part of his inner circle. He was only defense minister for half a year.

The conundrum with the priorities

On Thursday, observers at home and abroad tried to deduce something about the CCP’s future priorities from the vague communiqué. Some point out that development still comes first in the formula of “ensuring development and security.” Others interpret the frequent emphasis on national security as focusing on more control.

The question of whether power politics or economic growth comes first in China is also of great importance to the German economy. They want open markets, deregulation and an economic policy with as little national focus as possible, in which foreign players can assume a crucial role.

However, a policy of military strengthening is aimed more at becoming autonomous, i.e., able to do everything itself and as independent as possible from foreign countries. In the field of technology, for example, the Made in China 2025 program had this effect. It was a program to rapidly develop key industries such as robotics and electric cars. China almost no longer needs foreign countries here.

The primacy of politics over the economy continues

The documents surrounding a Third Plenum generally indicate both, depending on where one’s own preferences lie: a liberal economic program or even tighter rein over all areas. The overall picture that emerges from Thursday’s announcement is more of a continuation of existing policy:

  • The word “development” frequently appeared with 42 matches (search for 发展 in the Chinese version). Throughout the Third Plenums, the topic of economic development also appeared more frequently again, although still much less frequently than in the Third Plenum 16 years ago. So the economic downturn does seem to have brought about a return to economic and development policy.
  • Meanwhile, contrary to expectations, “reform” has taken a back seat,
  • while the national and military security complex continues to be prominently represented.

The overall picture that emerges: The power-political instrumentalization of the economy (instead of prosperity as an end in itself) continues, but there is great interest in not letting the economy crash completely.

  • Chinese Communist Party
  • Economic Situation
  • Qin Gang
  • Xi Jinping

Events

July 22, 2024; 3 p.m. CEST (9 p.m. Beijing time)
Center for Strategic & International Studies, Webcast: China’s Third Plenum: A Plan for Renewed Reform? More

July 22, 2024; 11 a.m. CEST (4 p.m. Beijing time)
GIGA Hamburg, Seminar (hybrid): Navigating Post-Pandemic Fieldwork in China: Challenges, Adaptations, and Insights More

July 23, 2024; 3 p.m. CEST (9 p.m. Beijing time)
Merics, China Spektrum online discussion: The CCP’s Third Plenum and China’s future economic course More

July 24, 2024; 9 a.m. CEST (3 p.m. Beijing time)
AHK Greater China, GCC Knowledge Hub: Updates on PRC Corporate Governance and Employee Representation – What Companies Need to Do More

July 24, 2024; 3 p.m. Beijing time
EU SME Center, Policy Meeting: Decoding China’s Third Plenum More

July 25, 2024; 6 p.m. Beijing time
Webinar, Dezan Shira & Associates: From China to Southeast Asia: Effective HR Approaches for Regional Success More

July 26, 2024; 3:30 p.m. CEST (9:30 p.m. Beijing time)
Center for Strategic & International Studies, Webcast: Countering China in the Gray Zone: Lessons from Taiwan More

News

De-risking: German companies encounter hurdles in Asia

According to a survey, the sentiment of German companies in the Asia-Pacific region has improved significantly. The companies surveyed are particularly optimistic about economic development and their business prospects in the area. The exception, however, is Greater China. Optimism there remains subdued, according to a special analysis of the AHK World Business Outlook for the German Chambers of Commerce Abroad (AHK) on behalf of the German Chamber of Industry and Commerce (DIHK). It is available exclusively to Table.Briefings. Around 660 German member companies in the Asia-Pacific region were interviewed for the survey.

“This positive development strengthens our local companies and also gives the German economy a boost. The region remains one of the most important destinations for business diversification,” said Volker Treier, DIHK Head of Foreign Trade, referring to the analysis. The survey shows that German companies’ investment intentions have increased or remained the same in many places in the Asia-Pacific region. The only noticeable reluctance to invest was in Hong Kong, Singapore and New Zealand.

Four out of five companies encounter hurdles when diversifying

The situation is different in Japan: “More and more German companies are setting up or expanding important units there, as Japan plays a central role in their China+1 strategy,” says Treier. Companies in India, the Philippines and Vietnam are particularly optimistic about economic development.

While employment plans in Hong Kong and China are negative, most other AHK locations in Asia-Pacific are expecting new jobs. The Philippines, Japan, and Malaysia, in particular, are expected to see an increase in employment.

The survey shows that diversification remains a challenge: The focus in Hong Kong and Malaysia is on expanding the supplier network, while companies in Singapore, Vietnam and Taiwan are tapping into new sales markets. Around four out of five companies (84 percent) face obstacles in their diversification efforts. The respondents cite problems in the search for suitable new suppliers or business partners as examples of this. Regulatory requirements and high costs also represented hurdles. ari

Brantner: Lithium deposits in Serbia contribute to independence

German State Secretary for Economic Affairs Franziska Brantner has called the planned agreement between the EU and Serbia on the supply of raw materials an important contribution to independence from Chinese supplies. “The Memorandum of Understanding with Serbia is a relevant step in the attempt to use European deposits for European purposes and to make European industry less dependent on China,” said the Green Party politician on Thursday. “The lithium deposits in Serbia can contribute to this.”

She said there were deposits in Germany or the Czech Republic that should be used. “This would also reduce dependence on China.” Serbia’s President Aleksandar Vučić told the German business newspaper Handelsblatt that his government had prioritized the EU over China. Brantner also welcomed the fact that the raw materials company Rio Tinto had improved environmental standards in its plans for a lithium mine in Serbia. The Serbian government once again granted Rio Tinto the license for lithium mining, previously revoked in 2022.

Vučić wants Serbia to become a car production hub

Two declarations of intent are to be signed in Belgrade on Friday. The first concerns a raw materials agreement between the EU and the EU accession candidate. Secondly, Serbia wants to sign a declaration of intent with car companies such as Mercedes and Stellantis to establish a lithium processing industry sector. The two car manufacturers are reportedly in talks with the Serbian government about investing in lithium processing and EV battery production. Bloomberg reports this, citing people familiar with the situation.

Serbia’s President Vučić clarified that the contract award to Rio Tinto and a supply to Europe also had industrial policy reasons. “We want to keep value creation – as far as possible – in our own country,” he told Handelsblatt. “That’s why we want to locate battery production in Serbia and only sell part of the lithium as a raw material.” He also wants to establish Serbia as a car production hub. Exports to the EU are possible without customs duties. Stellantis already operates a car factory in Serbia and talks are underway with South Korea. Chinese manufacturers have also expressed interest. “But we are loyal to Europe,” said Vučić. rtr

  • De-risking
  • EU-Beitritt

Re-election: These are the China items of von der Leyen’s manifesto

EU Commission President Ursula von der Leyen was re-elected to her post on Thursday. The European Parliament confirmed von der Leyen with 401 votes. While the first political manifesto of her first term of office in 2019 did not mention China, von der Leyen’s political guidelines for the next five years, published on Thursday, now outline her China policy course.

The most important points:

  • De-Risking: “We have seen first-hand the dangers of dependencies or fraying supply chains – from medical products in the pandemic to Putin’s energy blackmail or China’s monopoly on raw materials essential for batteries or chips.”
  • Defense: “Combined EU spending on defense from 1999 to 2021 increased by 20 percent. In that time, Russia’s defense spending increased by almost 300 percent and China’s by almost 600 percent. At the same time, our spending is too disjointed, disparate and not European enough. We must change this.”
  • Competitiveness: “The more aggressive posture and unfair economic competition from China, its ‘no-limits’ friendship with Russia – and the dynamics of its relationship with Europe – reflect a shift from cooperation to competition.”
  • Economic security: “The Commission will prioritize advancing Europe’s economic security and economic statecraft. This means boosting our competitiveness at home and investing in research capacity for strategic and dual-use technologies that are essential for our economy and security.”
  • Economic security II: “At the same time, we must be more assertive in protecting our economy from key technology leakage and security concerns. This issue is particularly acute when dealing with those who are also strategic competitors and systemic rivals.”
  • Foreign Direct Investment Review: “This will be based on a clear-sighted risk assessment and our principle of ‘risk mitigation not decoupling’. We will complete the review of the FDI screening framework, develop a truly coordinated approach to export controls, and address the risks of foreign investment.”
  • Global Gateway: “This will be based on a clear-eyed risk assessment and our principle of ‘de-risking not decoupling’. We will complete the review of the foreign direct investment screening framework, build a genuine coordinated approach to export controls, and address risks from outbound investments.”
  • Indo-Pacific: “We will work with Japan, Korea, New Zealand and Australia with whom we face common challenges in cyber, space and in the secure supply of critical minerals and technologies.”
  • Taiwan: “This includes our collective efforts to deploy the full range of our combined statecraft to deter China from unilaterally changing the status quo by military means, particularly over Taiwan.” ari
  • De-risking
  • EU
  • Europäisches Parlament
  • European election 2024
  • European policy
  • Geopolitics
  • Global Gateway
  • Ursula von der Leyen
  • Weltraum

Tariff dispute with Beijing: Which exporters are under investigation

In the trade dispute with the EU, China is now opening direct investigations into three leading European pork suppliers. Specifically, the Danish company Danish Crown, the Dutch company Vion Boxtel BV and the Spanish producer Litera Meat S.L.U. are being investigated, as the Ministry of Commerce in Beijing announced on Thursday. The companies are the largest suppliers of pork products from the European Union to China.

According to the Chinese authorities, the investigations will examine whether these exporters are selling their products at prices below the normal market value, which could harm the Chinese industry. The investigation is expected to be completed by June 17, 2025, but could be extended by six months if necessary.

In 2023, China purchased the equivalent of 5.5 billion dollars worth of imported pork, including by-products such as feet, ears and offal, which are in high demand in China, unlike in Europe. More than half of the goods came from the EU. Denmark, the Netherlands and Spain had supported extra tariffs on Chinese EVs.

EU brandy imports under scrutiny

In addition to meat products, China also has its sights set on European brandy imports. In 2023, China imported 43.31 million liters of brandy, more than 96 percent of which came from France, which had also spoken out in favor of the tariffs.

High-ranking representatives of French cognac producers and the EU took part in a hearing in Beijing on Thursday, according to the French lobby association BNIC. The companies under scrutiny include those owned by Remy Cointreau, Pernod Ricard and LVMH. The meeting offered the cognac producers a first opportunity to make a statement on the allegations. rtr/jul

  • Customs
  • Subsidies
  • Trade dispute

Opinion

How the Chinese public sees its country’s foreign aid 

China’s development aid to other countries is largely negatively perceived by the Chinese public. Pointing to China’s still huge poor population and generally low social welfare for its citizens, many take the assistance as vanity projects for the government. 

These complaints, however, fall on a deaf ears of the government. After all, news about China’s assistance to other countries is not often seen. It is also difficult for the government to tell the public the real calculations behind these funds as they are mostly likely to involve geopolitics considerations and export of over-capacity, among other unspeakable motives. Official experts also discuss the topic rarely in the media. 

A brief history of Chinese development aid

China already provided development aid to other countries in the Third World during the Mao era (1949-1976), mainly in the form of agricultural products, grants, and medical services provided by Chinese doctors sent to Africa. Since the 1990s, aid has been increasingly in the form of building infrastructure for the recipient countries. 

If both grants and concessional loans are included, China’s development financing is estimated to be around 85 billion US dollars a year. Internationally, debates about China’s financial support to the Global South focus on topics such as whether it would bring real economic benefits to recipient countries’ people and whether they would fall into China’s “debt trap.” The country’s official news outlets do occasionally report on China’s assistance and other major international projects, such as the One-Belt One Road Initiative, but the reporting is always in the typical vague, jargon-laden language, which makes it difficult to know the truth, complete picture.  

Realist Chinese’s observations on the aids 

Some amateur Chinese international relations analysts believe they understand what is behind the Chinese money. Under a social media post comparing the influence of China and the United States in Africa, there is a debate about what China gets out of its assistance to African countries. “I don’t see the point. Africans will be your friends only when you give them money,” said one in a post on Weibo, the Chinese equivalent to the X, formerly known as Twitter. “Do you think China gives the money for nothing? We get natural resources!” retorted another. These things, however, are not what most average Chinese citizens care about. Most find the aids unjustified.

Under another Weibo post published in early July about China waiving debts for African countries, netizens asked various rhetorical questions. “Where does the money come from? Is the money for poor kids’ lunch?” said one, alluding to recent findings by the National Audit Office that some local governments used funds earmarked for impoverished schoolchildren’s lunch in the countryside to service government debts. 

Opposition to benefits for foreign students

Has the government forgotten how many poor people China has, and how many of them can’t afford medical services?” asked another. Despite the size of the Chinese economy, around 600 million people still have to live on less than the equivalent of 4.50 euros a day, and more than 800 million do not have adequate social security.

One form of China’s foreign aid is funding foreign students’ higher education in the country. China has been offering generous scholarships to foreign students, particularly those from developing countries, who study in universities all over the country in academic areas ranging from engineering and medicine to economics and international relations. 

Foreign students are normally given a much better living environment than Chinese students on the same campus, which has become a chronic source of bitter feelings until now. The issue came to a head in 2019 when Shandong University reportedly assigned Chinese students as “learning companions” to overseas students. Some were particularly offended by the alleged arrangement of female Chinese students being assigned to help male foreign students.  

  • Geopolitik

Executive Moves

Edward Zhou, previously an executive at the biotechnology company Cytiva, has been appointed head of the medical technology business in China by the American pharmaceutical group Johnson & Johnson. He succeeds Will Song.

Jinqing Cai is the new President Brand Activities in Greater China at the French luxury group Kering. She works at the group’s headquarters in Shanghai and reports to CEO Jean-François Palus. She previously served as Chairman of the Board of Christie’s China.

Is something changing in your organization? Let us know at heads@table.media!

Dessert

Nothing is hanging here, but that’s what they’re called anyway: the Hanging Gardens at the Hangzhou International Expo Center. The top floor of the exhibition building is home to a green area of around 65,000 square meters, including watercourses and trees. Perfect for a short break after an hour-long visit to the trade fair. The hanging gardens are based on one of the Seven Wonders of the Ancient World: the Hanging Gardens of Semiramis. The elaborate garden complex is said to have been located in Babylon in Mesopotamia, in present-day Iraq.

China.Table editorial team

CHINA.TABLE EDITORIAL OFFICE

Licenses:
    Dear reader,

    It was postponed for months, and now the Third Plenum of the Central Committee has ended. The counting has already begun: How often have the words “reform,” “development” or national security been mentioned? On Thursday, observers at home and abroad tried to deduce anything about the CCP’s future priorities from the meager communiqué. Does the frequent emphasis on national security indicate more control? The German economy will greatly depend on whether power politics or economic growth is the future focus. Finn Mayer-Kuckuk has analyzed the outcome of the important planning conference and at least recognizes the Chinese leadership’s interest in not letting the economy crash completely. Read his analysis to find out what else he found out.

    “I don’t see the point. Africans will be your friends only when you give them money.” Or: “Has the government forgotten how many poor people China has?” This is how the Chinese public comments on China’s development aid on social media. Quite a contrast to the Western perception, which accuses China of luring poorer countries into a debt trap. Yes – which one is it? One thing is clear: China gives a lot – almost 80 billion euros annually. One of our authors from China looks at the social debate and the political goals that the aid is pursuing.

    German research faces a dilemma: German universities seek exchange with international partners and students. However, no one wants to cooperate with organizations that support military developments in China. But how can scientists weigh up the risks and opportunities of scientific cooperation? It’s difficult – but important. Universities and researchers “have to be very careful” in all research fields that expand China’s military or surveillance potential, says Yannick Ringot from the HNC³ network in an interview with Table.Briefings. This initiative, to which the University of Hamburg belongs, pools China expertise in the Hanseatic city. Marcel Grzanna’s analysis shows what stricter screening procedures look like at various universities.

    Your
    Julia Fiedler
    Image of Julia  Fiedler

    Feature

    Research: How German academia becomes more aware of risks

    Uni Hamburg
    The University of Hamburg now subjects foreign research inquiries to an in-depth review process.

    China’s position in the Ukraine war has triggered a rethink in German academia. Ever since numerous pieces of evidence have emerged that Beijing is providing military support to its close friend and strategic partner Vladimir Putin, a number of collaborations between German universities and research institutes and Chinese institutions have been cast in a different light.

    “The war in Ukraine has changed perceptions. We cannot deny that there is a rivalry alongside the partnership with China,” says Yannick Ringot, coordinator of the Hamburg Network on Compliance in Cooperation with China HNC³ at the University of Hamburg.

    There is still a considerable need for knowledge and instructions in areas where an extensive exchange with Chinese partners was largely approved without hesitation just a few years ago. Scientists are faced with the dilemma of having to weigh up the risks and opportunities of cooperation. Ringot told Table Briefings that “researchers and universities have to be very careful” in all research fields that expand China’s military or surveillance potential.

    ‘Universities have a social responsibility’

    The HNC³ network is funded by the German Federal Ministry of Education and Research and pools the China expertise of nine academic institutions in Hamburg. The central player in the network is the University of Hamburg. Earlier than others, it started to look closer at who it works with. The usual review of international cooperation requests was significantly intensified at the end of 2020. Since then, requests have been undergoing an in-depth review process.

    The implementation of this detailed evaluation resulted from the “dynamic global political situation,” from which a systemic rivalry between democracies and autocracies has increasingly crystallized. “Our universities have a social responsibility. They cannot be allowed to help arm the Chinese military,” says Ringot. The procedure has already been adjusted in detail several times to increasingly take account of the risk potential. The frequent readjustments are symbolic of the deficits that existed in the examinations at German universities just a few years ago.

    Opportunities overshadowed the risks for many years

    Also because it is not always easy to say “no.” China offers generous research project funding, well-trained guest scientists and partner institutions with state-of-the-art equipment. For many years, the opportunities for cooperation outweighed the potential threats to Germany’s sovereignty, national security and freedom of research. But that has changed since.

    “We are seeing a much greater awareness and concern, particularly in export control,” says Alicia Hennig, a business ethicist specializing in China from the International University Institute (IHI) Zittau at TU Dresden. This became clear at the German Federal Working Group on Export Controls and Science, where around 130 representatives from universities and research institutions debated how to deal with the risks and consequences of cooperation in mid-June. Hennig herself worked as a lecturer at a Chinese university for five years before she was no longer willing to abide by ideological boundaries in teaching out of consideration for her hosts, and left the country.

    Screening procedure is country-independent

    Within the working group, however, Hennig recognized “a lot of frustration that the German government does not play a central role in risk assessment for universities.” In its position paper on research safety in March 2024, the Federal Ministry of Education and Research (BMBF) announced plans to “actively support the review and (continued) development of corresponding guidelines and instruments by the scientific community” as part of its responsibilities. Despite this, universities are still forced to make the final decision.

    The problem here is that many academics have little or no China expertise. They evaluate risks based on their personal values and experiences. They can neither classify the individual backgrounds of Chinese scientists nor identify the ties between partner institutions and the state arms industry or surveillance programs.

    The University of Hamburg wants to close these gaps. Its in-depth examination procedure is not country-specific. Requests from other countries are also closely scrutinized, especially if they have autocratic structures. Nevertheless, requests for cooperation with Chinese partners initiate most of the procedures.

    Ongoing project at the University of Hamburg terminated

    The vast majority of the approximately 20 procedures examined to date involve STEM subjects. Most of them have been given the green light. In one case, however, an ongoing collaboration was terminated. The third-party-funded project in question focussed on machine learning and AI. When the application for the third phase began, several open and critical questions emerged, which, after extensive debate and consideration, spoke against a continuation.

    The procedure takes time: After a classification based on the country list of the Academic Freedom Index (AFI), a subject-related classification by research areas with increased risk or export control relevance is performed, if necessary. If the criteria of the German Federal Office for Export Control also indicate a high risk, the review goes into detail. The university then obtains information from project managers and the assessments of a handful of departments, coordinates them with each other, holds consultations and finally drafts a proposal for the presidential board. This is where the final decision is made whether or not a cooperation will be established.

    Specific information offered at the TU Munich

    The TU Munich has also become cautious. “In recent years, we have noticed a high level of sensitivity as well as an increased need for consultation among our researchers with regard to international collaborations,” the university explains. China is a particular focus here. As part of its Global Engagement Principles developed in 2022, TU Darmstadt has set up a “China Roundtable,” which provides researchers with specific information and recommendations. On the one hand, this is intended to contribute to further awareness raising. On the other hand, the aim is to create opportunities for the best possible organization of scientific cooperation. In general, the guiding questions of the German Rectors’ Conference on cooperation with Chinese partners are used as a basis.

    At the Free University of Berlin, an awareness-raising process is also being driven forward, primarily by the international and legal departments. An in-depth review process has been in a test phase since the beginning of the year. So far, applications for third-party funding have only received a recommendation or, “in the case of certain countries such as China,” the university administration has been able to request a review on its part. In addition, the Free University has set up a China advisory board to advise university management on cooperation with China.

    Risks are far from over

    Applications for third-party funding with China are reviewed by the international department – particularly by the country officers – after consultation with the research department. Here, too, the key questions are: Is there a risk of encroachment on academic freedom or violations of export control law?

    Currently, the Free University’s research database lists six ongoing collaborations with China, all of which are fully funded by the European Union (Horizon), the German Academic Exchange Service (DAAD), the German Research Foundation (DFG) or other international organizations. In addition, there are two long-term projects with partial Chinese funding – the Center for German Studies, supported by Peking University, the Free University, and Humboldt University, which is funded by the DAAD and the three partners. China also funds the University’s Confucius Institute, “which operates separately from university teaching and primarily offers language courses and cultural events,” a statement from the university said.

    These examples show that parts of the scientific community in Germany are no longer willing to accept Chinese cooperation inquiries at any price. Have the risks been averted? Not by a long shot, says business ethicist Hennig. “There has been significant progress in some areas of German academia. In other areas, it is still very difficult or there is a lack of will to counter the risks with suitable mechanisms.”

    • Universitäten

    Third Plenary Session: These priorities emerge

    Xi Jinping leads the row of cadres for the closing session of the Third Plenum (official photo from Thursday). Behind him are Li Qiang, Zhao Leji, Wang Huning, Cai Qi, Ding Xuexiang and Li Xi.

    In its first communiqué after the end of the Third Plenum, the Central Committee of the Communist Party of China set out a timetable for the next interim economic targets. In addition, the public learns for the first time about the whereabouts of the deposed ministers, Qin Gang and Li Shangfu. The announcement also provides an initial indication of Xi Jinping’s priorities for the coming years.

    1. The current reform agenda is to be completed by 2029, the 80th anniversary of the founding of the People’s Republic, and
    2. The establishment of a “high-standard socialist market economy” is to be completed by 2035.

    Incidentally, these dates indicate that Xi will probably not step down after his current third term of office. In 2029, he will already be in his fourth, and he is explicitly named as the leader under whose guidance the goals are to be achieved. Longer documents are expected on Friday, which will provide details, in particular, what goals are targeted.

    The Central Committee is the most powerful body of the Communist Party and the sole ruling body in China. It only convenes seven times in a five-year period and sometimes makes far-reaching decisions. The Third Plenum of the Central Committee traditionally focuses on economic planning. The plenary session ended on Thursday. 264 members participated.

    Lenient punishment for Qin Gang

    According to the document, former Foreign Minister Qin Gang has resigned from the Central Committee. This suggests a friendly treatment of the ousted senior official: He was given the opportunity to resign instead of being expelled. As a loyal follower of Xi, he is apparently treated a little more gently even after he has fallen from grace.

    Qin had been promoted to minister in record time and was obviously part of Xi’s inner circle. Qin Gang met with German Foreign Minister Annalena Baerbock twice, once in Beijing and once in Berlin. At the time, the frosty tone between the Foreign Minister and the Foreign Minister was particularly striking. Qin was well known in the West, as he had previously been spokesperson for the Foreign Ministry and ambassador to the USA.

    Harsher punishment for Li Shangfu

    While Qin was given the opportunity to resign, the general and ex-defense minister Li Shangfu was ousted from the Central Committee. Li’s promotion to minister in 2023 is said to have been thanks to his predecessor Wei Fenghe. Wei was also recently charged with corruption.

    Unlike Qin, whose transgressions are still unknown today, there was probably nothing left to gloss over. Especially as it is Xi’s intention to keep the military clean. Moreover, Li was probably not part of his inner circle. He was only defense minister for half a year.

    The conundrum with the priorities

    On Thursday, observers at home and abroad tried to deduce something about the CCP’s future priorities from the vague communiqué. Some point out that development still comes first in the formula of “ensuring development and security.” Others interpret the frequent emphasis on national security as focusing on more control.

    The question of whether power politics or economic growth comes first in China is also of great importance to the German economy. They want open markets, deregulation and an economic policy with as little national focus as possible, in which foreign players can assume a crucial role.

    However, a policy of military strengthening is aimed more at becoming autonomous, i.e., able to do everything itself and as independent as possible from foreign countries. In the field of technology, for example, the Made in China 2025 program had this effect. It was a program to rapidly develop key industries such as robotics and electric cars. China almost no longer needs foreign countries here.

    The primacy of politics over the economy continues

    The documents surrounding a Third Plenum generally indicate both, depending on where one’s own preferences lie: a liberal economic program or even tighter rein over all areas. The overall picture that emerges from Thursday’s announcement is more of a continuation of existing policy:

    • The word “development” frequently appeared with 42 matches (search for 发展 in the Chinese version). Throughout the Third Plenums, the topic of economic development also appeared more frequently again, although still much less frequently than in the Third Plenum 16 years ago. So the economic downturn does seem to have brought about a return to economic and development policy.
    • Meanwhile, contrary to expectations, “reform” has taken a back seat,
    • while the national and military security complex continues to be prominently represented.

    The overall picture that emerges: The power-political instrumentalization of the economy (instead of prosperity as an end in itself) continues, but there is great interest in not letting the economy crash completely.

    • Chinese Communist Party
    • Economic Situation
    • Qin Gang
    • Xi Jinping

    Events

    July 22, 2024; 3 p.m. CEST (9 p.m. Beijing time)
    Center for Strategic & International Studies, Webcast: China’s Third Plenum: A Plan for Renewed Reform? More

    July 22, 2024; 11 a.m. CEST (4 p.m. Beijing time)
    GIGA Hamburg, Seminar (hybrid): Navigating Post-Pandemic Fieldwork in China: Challenges, Adaptations, and Insights More

    July 23, 2024; 3 p.m. CEST (9 p.m. Beijing time)
    Merics, China Spektrum online discussion: The CCP’s Third Plenum and China’s future economic course More

    July 24, 2024; 9 a.m. CEST (3 p.m. Beijing time)
    AHK Greater China, GCC Knowledge Hub: Updates on PRC Corporate Governance and Employee Representation – What Companies Need to Do More

    July 24, 2024; 3 p.m. Beijing time
    EU SME Center, Policy Meeting: Decoding China’s Third Plenum More

    July 25, 2024; 6 p.m. Beijing time
    Webinar, Dezan Shira & Associates: From China to Southeast Asia: Effective HR Approaches for Regional Success More

    July 26, 2024; 3:30 p.m. CEST (9:30 p.m. Beijing time)
    Center for Strategic & International Studies, Webcast: Countering China in the Gray Zone: Lessons from Taiwan More

    News

    De-risking: German companies encounter hurdles in Asia

    According to a survey, the sentiment of German companies in the Asia-Pacific region has improved significantly. The companies surveyed are particularly optimistic about economic development and their business prospects in the area. The exception, however, is Greater China. Optimism there remains subdued, according to a special analysis of the AHK World Business Outlook for the German Chambers of Commerce Abroad (AHK) on behalf of the German Chamber of Industry and Commerce (DIHK). It is available exclusively to Table.Briefings. Around 660 German member companies in the Asia-Pacific region were interviewed for the survey.

    “This positive development strengthens our local companies and also gives the German economy a boost. The region remains one of the most important destinations for business diversification,” said Volker Treier, DIHK Head of Foreign Trade, referring to the analysis. The survey shows that German companies’ investment intentions have increased or remained the same in many places in the Asia-Pacific region. The only noticeable reluctance to invest was in Hong Kong, Singapore and New Zealand.

    Four out of five companies encounter hurdles when diversifying

    The situation is different in Japan: “More and more German companies are setting up or expanding important units there, as Japan plays a central role in their China+1 strategy,” says Treier. Companies in India, the Philippines and Vietnam are particularly optimistic about economic development.

    While employment plans in Hong Kong and China are negative, most other AHK locations in Asia-Pacific are expecting new jobs. The Philippines, Japan, and Malaysia, in particular, are expected to see an increase in employment.

    The survey shows that diversification remains a challenge: The focus in Hong Kong and Malaysia is on expanding the supplier network, while companies in Singapore, Vietnam and Taiwan are tapping into new sales markets. Around four out of five companies (84 percent) face obstacles in their diversification efforts. The respondents cite problems in the search for suitable new suppliers or business partners as examples of this. Regulatory requirements and high costs also represented hurdles. ari

    Brantner: Lithium deposits in Serbia contribute to independence

    German State Secretary for Economic Affairs Franziska Brantner has called the planned agreement between the EU and Serbia on the supply of raw materials an important contribution to independence from Chinese supplies. “The Memorandum of Understanding with Serbia is a relevant step in the attempt to use European deposits for European purposes and to make European industry less dependent on China,” said the Green Party politician on Thursday. “The lithium deposits in Serbia can contribute to this.”

    She said there were deposits in Germany or the Czech Republic that should be used. “This would also reduce dependence on China.” Serbia’s President Aleksandar Vučić told the German business newspaper Handelsblatt that his government had prioritized the EU over China. Brantner also welcomed the fact that the raw materials company Rio Tinto had improved environmental standards in its plans for a lithium mine in Serbia. The Serbian government once again granted Rio Tinto the license for lithium mining, previously revoked in 2022.

    Vučić wants Serbia to become a car production hub

    Two declarations of intent are to be signed in Belgrade on Friday. The first concerns a raw materials agreement between the EU and the EU accession candidate. Secondly, Serbia wants to sign a declaration of intent with car companies such as Mercedes and Stellantis to establish a lithium processing industry sector. The two car manufacturers are reportedly in talks with the Serbian government about investing in lithium processing and EV battery production. Bloomberg reports this, citing people familiar with the situation.

    Serbia’s President Vučić clarified that the contract award to Rio Tinto and a supply to Europe also had industrial policy reasons. “We want to keep value creation – as far as possible – in our own country,” he told Handelsblatt. “That’s why we want to locate battery production in Serbia and only sell part of the lithium as a raw material.” He also wants to establish Serbia as a car production hub. Exports to the EU are possible without customs duties. Stellantis already operates a car factory in Serbia and talks are underway with South Korea. Chinese manufacturers have also expressed interest. “But we are loyal to Europe,” said Vučić. rtr

    • De-risking
    • EU-Beitritt

    Re-election: These are the China items of von der Leyen’s manifesto

    EU Commission President Ursula von der Leyen was re-elected to her post on Thursday. The European Parliament confirmed von der Leyen with 401 votes. While the first political manifesto of her first term of office in 2019 did not mention China, von der Leyen’s political guidelines for the next five years, published on Thursday, now outline her China policy course.

    The most important points:

    • De-Risking: “We have seen first-hand the dangers of dependencies or fraying supply chains – from medical products in the pandemic to Putin’s energy blackmail or China’s monopoly on raw materials essential for batteries or chips.”
    • Defense: “Combined EU spending on defense from 1999 to 2021 increased by 20 percent. In that time, Russia’s defense spending increased by almost 300 percent and China’s by almost 600 percent. At the same time, our spending is too disjointed, disparate and not European enough. We must change this.”
    • Competitiveness: “The more aggressive posture and unfair economic competition from China, its ‘no-limits’ friendship with Russia – and the dynamics of its relationship with Europe – reflect a shift from cooperation to competition.”
    • Economic security: “The Commission will prioritize advancing Europe’s economic security and economic statecraft. This means boosting our competitiveness at home and investing in research capacity for strategic and dual-use technologies that are essential for our economy and security.”
    • Economic security II: “At the same time, we must be more assertive in protecting our economy from key technology leakage and security concerns. This issue is particularly acute when dealing with those who are also strategic competitors and systemic rivals.”
    • Foreign Direct Investment Review: “This will be based on a clear-sighted risk assessment and our principle of ‘risk mitigation not decoupling’. We will complete the review of the FDI screening framework, develop a truly coordinated approach to export controls, and address the risks of foreign investment.”
    • Global Gateway: “This will be based on a clear-eyed risk assessment and our principle of ‘de-risking not decoupling’. We will complete the review of the foreign direct investment screening framework, build a genuine coordinated approach to export controls, and address risks from outbound investments.”
    • Indo-Pacific: “We will work with Japan, Korea, New Zealand and Australia with whom we face common challenges in cyber, space and in the secure supply of critical minerals and technologies.”
    • Taiwan: “This includes our collective efforts to deploy the full range of our combined statecraft to deter China from unilaterally changing the status quo by military means, particularly over Taiwan.” ari
    • De-risking
    • EU
    • Europäisches Parlament
    • European election 2024
    • European policy
    • Geopolitics
    • Global Gateway
    • Ursula von der Leyen
    • Weltraum

    Tariff dispute with Beijing: Which exporters are under investigation

    In the trade dispute with the EU, China is now opening direct investigations into three leading European pork suppliers. Specifically, the Danish company Danish Crown, the Dutch company Vion Boxtel BV and the Spanish producer Litera Meat S.L.U. are being investigated, as the Ministry of Commerce in Beijing announced on Thursday. The companies are the largest suppliers of pork products from the European Union to China.

    According to the Chinese authorities, the investigations will examine whether these exporters are selling their products at prices below the normal market value, which could harm the Chinese industry. The investigation is expected to be completed by June 17, 2025, but could be extended by six months if necessary.

    In 2023, China purchased the equivalent of 5.5 billion dollars worth of imported pork, including by-products such as feet, ears and offal, which are in high demand in China, unlike in Europe. More than half of the goods came from the EU. Denmark, the Netherlands and Spain had supported extra tariffs on Chinese EVs.

    EU brandy imports under scrutiny

    In addition to meat products, China also has its sights set on European brandy imports. In 2023, China imported 43.31 million liters of brandy, more than 96 percent of which came from France, which had also spoken out in favor of the tariffs.

    High-ranking representatives of French cognac producers and the EU took part in a hearing in Beijing on Thursday, according to the French lobby association BNIC. The companies under scrutiny include those owned by Remy Cointreau, Pernod Ricard and LVMH. The meeting offered the cognac producers a first opportunity to make a statement on the allegations. rtr/jul

    • Customs
    • Subsidies
    • Trade dispute

    Opinion

    How the Chinese public sees its country’s foreign aid 

    China’s development aid to other countries is largely negatively perceived by the Chinese public. Pointing to China’s still huge poor population and generally low social welfare for its citizens, many take the assistance as vanity projects for the government. 

    These complaints, however, fall on a deaf ears of the government. After all, news about China’s assistance to other countries is not often seen. It is also difficult for the government to tell the public the real calculations behind these funds as they are mostly likely to involve geopolitics considerations and export of over-capacity, among other unspeakable motives. Official experts also discuss the topic rarely in the media. 

    A brief history of Chinese development aid

    China already provided development aid to other countries in the Third World during the Mao era (1949-1976), mainly in the form of agricultural products, grants, and medical services provided by Chinese doctors sent to Africa. Since the 1990s, aid has been increasingly in the form of building infrastructure for the recipient countries. 

    If both grants and concessional loans are included, China’s development financing is estimated to be around 85 billion US dollars a year. Internationally, debates about China’s financial support to the Global South focus on topics such as whether it would bring real economic benefits to recipient countries’ people and whether they would fall into China’s “debt trap.” The country’s official news outlets do occasionally report on China’s assistance and other major international projects, such as the One-Belt One Road Initiative, but the reporting is always in the typical vague, jargon-laden language, which makes it difficult to know the truth, complete picture.  

    Realist Chinese’s observations on the aids 

    Some amateur Chinese international relations analysts believe they understand what is behind the Chinese money. Under a social media post comparing the influence of China and the United States in Africa, there is a debate about what China gets out of its assistance to African countries. “I don’t see the point. Africans will be your friends only when you give them money,” said one in a post on Weibo, the Chinese equivalent to the X, formerly known as Twitter. “Do you think China gives the money for nothing? We get natural resources!” retorted another. These things, however, are not what most average Chinese citizens care about. Most find the aids unjustified.

    Under another Weibo post published in early July about China waiving debts for African countries, netizens asked various rhetorical questions. “Where does the money come from? Is the money for poor kids’ lunch?” said one, alluding to recent findings by the National Audit Office that some local governments used funds earmarked for impoverished schoolchildren’s lunch in the countryside to service government debts. 

    Opposition to benefits for foreign students

    Has the government forgotten how many poor people China has, and how many of them can’t afford medical services?” asked another. Despite the size of the Chinese economy, around 600 million people still have to live on less than the equivalent of 4.50 euros a day, and more than 800 million do not have adequate social security.

    One form of China’s foreign aid is funding foreign students’ higher education in the country. China has been offering generous scholarships to foreign students, particularly those from developing countries, who study in universities all over the country in academic areas ranging from engineering and medicine to economics and international relations. 

    Foreign students are normally given a much better living environment than Chinese students on the same campus, which has become a chronic source of bitter feelings until now. The issue came to a head in 2019 when Shandong University reportedly assigned Chinese students as “learning companions” to overseas students. Some were particularly offended by the alleged arrangement of female Chinese students being assigned to help male foreign students.  

    • Geopolitik

    Executive Moves

    Edward Zhou, previously an executive at the biotechnology company Cytiva, has been appointed head of the medical technology business in China by the American pharmaceutical group Johnson & Johnson. He succeeds Will Song.

    Jinqing Cai is the new President Brand Activities in Greater China at the French luxury group Kering. She works at the group’s headquarters in Shanghai and reports to CEO Jean-François Palus. She previously served as Chairman of the Board of Christie’s China.

    Is something changing in your organization? Let us know at heads@table.media!

    Dessert

    Nothing is hanging here, but that’s what they’re called anyway: the Hanging Gardens at the Hangzhou International Expo Center. The top floor of the exhibition building is home to a green area of around 65,000 square meters, including watercourses and trees. Perfect for a short break after an hour-long visit to the trade fair. The hanging gardens are based on one of the Seven Wonders of the Ancient World: the Hanging Gardens of Semiramis. The elaborate garden complex is said to have been located in Babylon in Mesopotamia, in present-day Iraq.

    China.Table editorial team

    CHINA.TABLE EDITORIAL OFFICE

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