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With little room for tightening, Beijing lacks good options to prevent a return of capital flight. China cannot afford to match the US policy changes as lower tax rates and higher interest rates would further drive up budget deficits and debt.

Worries about the future of civil society organizations in China are limited to only a handful of European countries. Others put their faith in established informal ties or have subscribed to Chinese understandings of “people-to-people exchanges,” which are unlikely to be affected by restrictions on non-governmental organizations.

Rebecca McKimm
Helping ensure the survival of the Iran nuclear deal presents China with the opportunity to raise its profile in international affairs and to set the tone in the nuclear non-proliferation debate.

In 2018, economic stability will remain the Chinese leadership's priority. Despite all the good intentions to tackle structural problems, Beijing will be hard-pressed to tolerate a drop of GDP growth below an annual average of 6.4 percent.

Xi Jinping’s promise to introduce legal accountability in China is undermined by the Communist Party’s absolute control. But Xi is no Frederick the Great. The new National Supervision Law may increase predictability, but unlike the Prussian king's legal reforms, it will not limit state power.

China is undergoing an “imperial turn” – domestically as well as in foreign politics. At home, Xi Jinping has reached the status of an “imperial chairman” at the apex of the CCP power pyramid. Internationally, China uses the space opened by the Trump administration to fill the void in effective global governance, but also to assert its dominance in East Asia and beyond.

China’s import ban on some "dirty" solid wastes could be a big contribution to protecting the global environment. The ban could force exporting countries to raise their recycling standards. At the same time, China would have to enforce stricter standards on domestic producers to defend the ban against potential trade disputes.

China's holistic approach to state security does not differentiate between policies to respond to external versus internal threats. The CCP mobilizes the entire society - with a mix of persuasion and coercion - to preempt threats from both inside and outside China’s borders and from both inside and outside the CCP.
 

Interview with Danit Gal (via Young China Watchers)

"Do it first, regulate later," is how Danit Gal characterizes China's approach to Artificial Intelligence (AI). In this interview, she describes China's competitive advantages as large-scale commercial application, strategic planning and the lack of regulation.

China works full steam on institutionalizing its cooperation with Eastern Europe, building the 16+1 initiative into a platform for its Belt and Road Initiative. The economic reality lags far behind the announcements, but the promise of Chinese investment and the symbolism of the high-level cooperation between China and Eastern Europe are turning into a stress test for EU cohesion.

The CCP reasserts its control over the private sector by extending its reach far inside foreign and Chinese companies. For foreign investors, such close and often involuntary cooperation with the party-state can bring lucrative opportunities but also lead to questionable business decisions.

Strict outflow controls have helped maintain China's financial stability. But they risk undermining their own utility by keeping funds in the country, driving investors into risky sectors and creating an excuse to postpone overdue reforms in the financial sector.

China’s leader Xi Jinping rolled out the red carpet for the US President in Beijing. At the same time, he works on reducing the United States' influence in Asia on regional security, trade and economic cooperation, leaving Washington with fewer options to counter China's expansion.

After his re-election as General Secretary of the CCP at the 19th Party Congress, Xi Jinping faces the challenging task of launching and speeding up numerous ambitious political programs that were adopted during his first term. To make that happen, China’s top leader counts on technocrats from high-tech industries.

Interview with Willy Lam

The 19th Congress of the Communist Party is an opportunity to take stock of five years of Xi Jinping rule. “Xi has benefitted tremendously from the world leadership vacuum left by US President Donald Trump”, says Willy Lam of the Chinese University of Hong Kong. But, he warns, China’s power projection won’t go very far unless Beijing addresses its “soft power deficit” and starts to respect international rules and laws.

The international community’s trade and financial sanctions against North Korea have few chances of improving the dismal historic record of such instruments. Chinese reluctance to enforce them and US reluctance to irritate China always leave a way out for Pyongyang.

(via The Diplomat)

Unlike any other Chinese leader since the reform era, Xi Jinping has worked on forging a Chinese national narrative with the aim to strengthen the ties between China’s citizens and the CCP. Chinese netizens challenge the official orthodoxy in online debates that are remarkably pluralistic despite increasing censorship and repression.

Economic planning and societal control: The digital transformation is changing the rules of the game in the global systemic competition. China's determined pursuit of a "digital Leninism" presents a major challenge to liberal market economies and democratic political systems. 

China's Internet economy is developing rapidly with the help of government funding and a protected domestic market. European governments have to rethink their digital policies to be prepared for the Chinese competition.

The state’s role in economic planning has increased under Xi Jinping, and national interests take precedence over market principles. Signs point to more government controls and intervention, rather than liberalisation, as a result of the 19th Party Congress.

With its recent promises of better market access for foreign companies, China tries to placate international criticism. But the steps are half-hearted at best, especially since the relaxations in some areas go hand in hand with new restrictions in others.

Interview with Shazeda Ahmed

In setting up the so called Social Credit System, China plans to monitor, rate and regulate the behavior of citizens and companies with the help of big data. What motivates the government? What are the major challenges? And what do people in China think about this system?

(via The Diplomat)

Sigmar Gabriel’s demand that China follow a “One Europe” created an unusual analogy to the “One China” policy, which accepts China’s dictum that foreign nations should not entertain diplomatic relations with Taiwan. Beijing’s comments on European unity also show that it struggles to understand the European idea of subordinating sovereignty in certain areas to a community of nations.

China’s outbound M&A volume has contracted significantly since the beginning of the year. The Chinese government’s attempt to curtail acquisitions outside the core business areas of Chinese companies and the resulting breathing spell could have a favourable effect on M&A success probabilities.

Interview with Shen Dingli (via Young China Watchers)

As China positions itself as a major country, it is confronted with a host of global security issues. Young China Watchers discussed China's positions on these issues, from the South China Sea to North Korea as well as its relations with the United States, India and Africa, with Dr. Shen Dingli, Professor and Associate Dean at Fudan University’s Institute of International Studies.