The EU and US are continuously expanding their catalog of trade and investment measures. One of the latest additions is the EU’s Anti-Coercion Instrument, which will come into force in autumn 2023.
Von Experts Table.Briefings
China’s local government debt has continued to rise in Q1 2023. At the end of April, the debt level is closer to the ceiling set by the central government for 2023 than in the previous two years. Local governments are likely faced with a tightening budget and limited fiscal flexibility created by debt burden and debt ceiling restrictions.
Von Experts Table.Briefings
Over the last few months, both the US and China have increased engagement with international partners in multilateral fora. In light of US-China tensions, these summits can be seen as attempts by both countries to win over partners for their cause. Most countries try to remain outside of the bilateral competition, but as the US and China are ramping up their efforts, it might become more difficult for countries to remain neutral.
Von Experts Table.Briefings
The Chinese Purchasing Managers' Index (PMI) for the manufacturing sector fell below 50 in April, signaling a significant slowdown in the economic recovery. As the sub-index for new export orders remained stable, the decline can mainly be attributed to declining domestic demand.
Von Experts Table.Briefings
Four months after dropping the strict zero-Covid policy, unemployment among China's youth continues to rise. However, the country's economic weakness cannot be the sole reason, as overall unemployment is gradually declining. Rather, the main causes appear to be a lack of prospects for college graduates.
Von Experts Table.Briefings
China tightly controls about three-quarters of global refined cobalt production. Its share in chemical refining for the production of batteries is even larger. China thus dominates the global supply chain for lithium batteries – from the ore to processing, from active materials to cells, and ultimately to the packs.
Von Experts Table.Briefings
Just as the overall Chinese economy in the first full quarter after the end of “zero-COVID”, the automotive sector also exhibits a mixed picture in terms of post-pandemic recovery. The total retail sales of Passenger Vehicles in Q1 2023 recorded a sharp decrease compared to the same period in 2022. However, premium car sales have consistently outperformed the overall sector with high growth. This sharp segregation of consumption demands is likely to remain in place in the foreseeable future.
Von Experts Table.Briefings
In 2022, China's exports of photovoltaic (PV) products increased by 80.3 percent. PV exports have increasingly become an important component of China’s foreign trade and economic promotion. However, this high export growth in PV products may be disrupted by supply chain resilience initiatives in the EU and the US.
Von Experts Table.Briefings
On 31st of March 2023, the Cybersecurity Review Office under the Cyberspace Administration of China (CAC) launched a cybersecurity investigation into the local sales of US memory chip company Micron. The official reason was concerns about supply chain security of critical information infrastructure. This is the first case of cybersecurity investigation into the products and services of a foreign company. In the context of the US-China tech war, this case might represent an example of how regulatory tools can be used for political objectives.
Von Experts Table.Briefings
Over decades, China has built a highly sophisticated toolbox of industrial policy instruments to steer economic activities and incentivize companies to act in accordance to political guidelines and objectives. One of the functions of this toolbox is to shape the role of foreign companies in the Chinese market, especially by setting localization expectations and requirements. The intensity of localization pressure depends on product type, industry and competition.
Von Experts Table.Briefings
