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China’s party-and-state leader tries to bring government officials under the reach of the legal system. But the purpose of this approach is less about ensuring compliance with the law than about ensuring the top leadership’s control over its bureaucracy.

After turbulences in the stock and real estate markets, China’s next speculative asset bubble might be building in the Fintech sector. Stricter regulation won’t solve the underlying problem: the lack of attractive investment options caused by low interest rates and capital controls will keep producing new bubbles. 

Turkey’s flirt with the China-dominated Shanghai Cooperation Organization casts doubt on Ankara’s commitment to Euro-Atlantic integration. So far, Beijing has remained cautious, but it may decide that closer cooperation with Turkey is in its long-term interest. This is a joint blog post with the German Marshall Fund of the United States.

The expansion of the Shanghai Cooperation Organization aligns with Beijing’s geostrategic ambitions. Drawing India closer into China’s orbit serves as a check against US influence, while Pakistan’s inclusion could help fight security threats. China’s Belt and Road Initiative, which aims to connect Eurasia and South Asia, could also benefit from the new members.

The Trump administration is committing a grave mistake by using Taiwan and the South China Sea as bargaining chips to secure China’s help with North Korea. Trump’s transactional approach to security policy risks damaging Sino-US relations at a time of high strategic uncertainty.

The global fight against climate change will continue after the US withdrawal from the Paris Agreement. Participants at a MERICS conference agree that Germany and China can play a decisive role in keeping the topic on the G20 agenda.

Tiffany G. Wong

On the 20th anniversary of Hong Kong’s return to the People’s Republic of China, the city is grappling with an identity question that threatens its relationship with the mainland. Chief Executive Carrie Lam’s political career will depend on how she deals with this challenge.

France’s new president will need China’s cooperation on issues like climate change to balance the US and Russia. But while Macron might open up new channels for Sino-European cooperation, he could also push Europe towards a tougher stance on trade and security issues.

The evasion of VAT for the import of digital services from China is a growing problem for the EU. Rather than waiting for the completion of a European single digital market, loopholes for non-EU suppliers should be closed now. 

International students in China have become the latest target in Beijing’s campaign to ensure thought control and political stability. The party-state’s obsession with “ideological security” clashes with its efforts to promote people-to-people exchanges as a key part of China’s global outreach.

Their concern over an increasingly erratic US foreign policy is bringing the EU and China closer together. Yet last weeks’ EU-China Summit also illustrated that this partnership remains limited to selected issues.

China aims to fight growing risks in its financial sector with restrictions on shadow banking assets and interbank lending. But a sudden reduction of liquidity could increase rather than reduce the risk of a financial panic and dampen growth.

Beijing’s modern sister city will be a symbol of political power rather than economic development. In many ways, Xiongan is designed as an antithesis of Shenzhen and Pudong.

Interview with Isabel Hilton

The working conditions for NGOs and independent journalists in China have become harder under the leadership of Xi Jinping. But according to Isabel Hilton, “civil society still has an enormous role to play.” In the new MERICS Experts Podcast, the editor of China Dialogue, an environmental website based in London and Beijing, talks about how NGOs and the media in today’s China navigate a tricky political environment.

Economic sanctions are the foreign policy instrument of choice against many of the world’s dictators. But the resilience of the Kim regime and China’s unwillingness to support a complete economic boycott have made them ineffective in North Korea.

Air pollution is a severe problem across China, but the levels of pollution vary greatly between regions. Though still a major challenge, air quality in urban centers like Beijing and Guangzhou is improving. Cities in the industrial heartland on the other hand have seen little to no Progress.

China has invited international leaders to weigh in on shaping the future design of its Belt and Road Initiative at a summit in Beijing. European governments are curious to find out if China is truly willing to multilateralize and institutionalize its flagship foreign policy Project.

This fall, the Chinese Communist Party will kick off its twice-a-decade National Party Congress. At a time when the U.S. retreats from its global leadership responsibilities and China tries to assert itself as a global leader, changes to the political agenda of China’s governing party and its top leadership are of increasing importance to the rest of the world.

Interview with Ian Johnson (via Young China Watchers)

After decades of prioritizing economic development, Chinese society is engaged in a search for values to fill the spiritual vacuum. Young China Watchers spoke with New York Times journalist Ian Johnson, who is also a Senior Policy Fellow at MERICS, about his new book “The Souls of China: The Return of Religion After Mao” (2017).

Charlotte Roehren (via The Diplomat)

With its growing international integration, China is becoming a major actor in global health issues. Beijing has valuable experience in fighting pandemics and in providing health and medical support to Africa. The G20 Summit in Hamburg will be an opportunity for China to step up its multilateral health engagement.

Washington and Beijing have to accept that there can be no more business as usual in dealing with the Kim regime. The two principal actors in this crisis have to work towards political change in North Korea through a new regional order in East Asia.

Katharina Otte
Beijing wants to end excessive land grabs and evictions of Chinese farmers. But the planned reform of the land administration law does not remove the root causes of the problem: urbanization pressure and fiscal problems at the local level.

Punitive levies on Chinese imports would hurt American consumers and U.S. companies that are part of the global supply chain. At the same time, they would strengthen Beijing's resolve to speed up its quest for independence from foreign technology.

A transatlantic shift in financial burden sharing within NATO would reverberate all the way to China. A weaker U.S. role in global security would lead to a weaker dollar – with serious consequences for China’s monetary policy and real economy.

Britain and Europe are too busy with their own divorce to care about Hong Kong’s future. The crack-down on pro-democracy activists after the election of Beijing-backed candidate Carrie Lam as the SAR’s new chief executive has only drawn muted responses from London and Brussels.