Mhe Sino-European investment agreement aims to facilitate market access for German and European companies. In dealing with China, however, you have to be realistic, according to Merics chief economist Max Zenglein. Such an agreement would hardly change the human rights violations of the authoritarian regime in Beijing. (Video, 8 min)
Beijing, Berlin, Düsseldorf Mostly once a year, China’s head of state and party leader Xi Jinping gives a speech to high-ranking ministry and provincial leaders at the Central University of the Communist Party, which sets the course for the year. But this time it had a special meaning. Because the five-year plan is currently being finalized, which should set the course for the economy in the People’s Republic from March to 2025.
Foreign company representatives may not have liked what Xi said behind closed doors earlier this week. “The most essential feature of building a new development pattern is to achieve a high level of self-sufficiency and self-improvement,” says Xi. ”
FIGAROVOX / TRIBUNE – The investment agreement announced on December 30, 2020 between the European Union and China should not be considered only from its commercial aspect, analyzes Yves Perez. According to the economist, this agreement unfortunately commits us more than it commits China, and will primarily benefit the Germans.
Yves Perez is professor emeritus and former dean of the law faculty of the Catholic University of the West in Angers, author of Virtues of protectionism (The Gunner, January 2020).
The investment agreement concluded on December 30, 2020 between the European Union and China is only a preliminary step. It will only be ratified by both parties after a period of two years. However, it has already been hailed as historic by Chancellor Angela Merkel and President of the European Commission Ursula Von der Leyen. What should we think of this agreement and its real scope?
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I propose to answer this question by analyzing it from three different angles of view. The first is that any agreement signed between a Western country and China is inherently asymmetrical. In other words, it commits us more than it commits China. This asymmetry is due to the very nature of the Chinese political and economic system.
The second is that this agreement should not be considered only under its commercial and purely bilateral aspect between the European Union and China, but within a broader, geopolitical and triangular framework between the United States, the European Union and the United States. China. The third is that on the European side this agreement will mainly benefit Germany, which has also put all its weight in the balance to obtain it.
Any agreement signed between a Western country and China is asymmetric by nature: it commits us more than it commits China.
China is used to signing a lot of international agreements, but then it applies them as it sees fit. Thus, when it was admitted to the WTO, it undertook to respect its rules. But, twenty years later, it is clear that it has not often done so. When it organized the Olympic Games at home, China promised, heart in hand, to respect press freedom.
Several flagships of European industry have passed under the Chinese flag
However, in 2020, it was again the country in the world that imprisoned the largest number of journalists. Finally, in Hong Kong, when the United Kingdom retired, it had agreed to apply the legislation in force. However, after the student revolt, she decided to implement her own national security legislation in order to restore order and crush the democratic movement.
But back to our agreement. Its stated aim is for the two parties to open their respective markets more widely to the other’s investments. Economic and trade relations between the European Union and China are already very important. China is the second trading partner of the European Union behind the United States. It represents 20.2% of Union imports of goods and absorbs 10.5% of its exports. On the investment side, the European Union has invested around 150 billion euros in the Middle Kingdom and the latter has placed on the old continent an amount at least equivalent.
Read also :EU-China trade deal: what are Beijing’s commitments really worth?
Several flagships of European industry have passed under the Chinese flag: we can cite the cases of Volvo in Sweden, Pirelli in Italy, Club Med and Lanvin in France, and Kuka and Krauss Maffei, two German SMEs specializing in machinery. tool and industrial robotics. On the other hand, in China, European companies have to deal with a double constraint: create joint ventures with local companies and agree to transfer their technology to them.
China has also invested heavily in recent years on the development of bilateral relations with the countries of the European Union. Italy has thus integrated the Silk Roads project, making its ports of Genoa and Trieste available to Chinese companies wishing to set up in Europe. Athens has ceded the port of Piraeus to the Chinese carrier Cosco, which also took control of the container ports of Bilbao and Valencia in Spain.
This deal is a masterstroke for China in its trade war with the United States
Portugal, which received 6MM euros in loans from China, accepted in exchange the takeover by a Chinese bank of Felidade, the country’s first private bank. In addition, China Three Gorges secured its grip on EDP (Energias do Portugal), the country’s leading electricity group, despite repeated warnings from Washington. Finally, the countries of Central and Eastern Europe now hold an annual summit with China.
It is therefore also to regain control and avoid maneuvers bypassing China that the Brussels Commission has embarked on negotiating this agreement. Under the new arrangement, China will benefit from greater access to several energy and manufacturing sectors in Europe. For its part, China is committed to facilitating the arrival of companies from the old continent in new promising markets such as clean vehicles, health, finance and “cloud“. In addition, China promises to join the International Labor Organization (ILO) and apply its rules.
Read also :Yves Perez: “The Australian example shows us that when we trade with China, we must not give in to naivety”
This agreement is a masterstroke for China in its trade war with the United States. Subject to economic sanctions decided by the Trump administration, China wanted to get closer to the European Union and take the United States from the rear. In Beijing, it is hoped that the Silk Roads project will allow the reconfiguration of trade networks on a global scale and end the hegemony of the United States. Before the Biden administration took hold, the agreement between Beijing and Brussels was already a failure for the transatlantic cooperation projects that Washington was sure to offer to its allies.
China will thus make it more difficult to pursue the trade war strategy launched by the United States. Beijing places itself in a position to fight or negotiate with the Biden administration depending on the posture that it chooses to adopt. In this sense, this agreement is indeed a masterstroke of China against the United States in the struggle between them for world hegemony.
In Europe, the winner is Germany, which has put all its weight in favor of this agreement
Germany wanted this agreement and it got it. Thanks to him, Berlin is repositioning itself as a key player between Washington and Beijing. German car companies (Daimler, Mercedes, Volkswagen) supported the conclusion of this agreement. The reason is simple. These companies now achieve a higher turnover in the Chinese market than they do in the American market.
In addition, the Chinese market, especially with the transition to hybrid and electric engines, offers them much more promising prospects. France, for its part, will be satisfied with more modest ambitions such as, for example, investment in Chinese retirement homes. This agreement also says a lot about the state of the balance of power between Berlin and Paris.
We are trailing Germany and, given the gaps that have widened as a result of the health crisis between our two countries, things are likely to worsen against us in the coming years.
The Alibaba founder made the internet business big in China. Jack Ma seemed almost bigger than the country and the party. Now the man with an estimated fortune of $ 50 billion has disappeared. A search for clues.
AWhen a golden elevator opens in a skyscraper on New York’s Fifth Avenue on January 9, 2017, two entrepreneurs step out for whom it cannot go higher. One is Donald Trump, who becomes the 45th President of the United States. The other is Jack Ma. “A key figure” in “relations with China,” as the television channel CNBC commented live.
“Jack” will create “one million jobs” in America, Trump announced in front of the cameras. This is how many small business owners want to connect Ma’s trading platform Alibaba, which is listed on the New York Stock Exchange, with the consumers of the billion-dollar people of China. Trump, who threatened China with a trade war during his election campaign, let himself be wrapped up by the Chinese, headlines the business newspaper “Barron’s”: “What Jack Ma Xi Jinping can teach.”
China echoed the troubled hours of American democracy in the wake of the invasion of the Capitol by supporters of President Donald Trump on the internet. Russia pointed to the “obsolete” electoral system and the deep divisions that left democracy “limping on both feet”. If it is true that Joe Biden, who takes office as president on the 20th, may, in contrast, benefit from a state of grace in some constituency that until now has not been seen in the former vice president, the consequences of what some describe as ” failed hit “and that left five dead and more than a dozen wounded policemen can be lasting out of doors.
The big US rival, Xi Jinping’s China, wasted no time criticizing the “stark contrast” between Washington’s response to chaos and Hong Kong’s protests in 2019. O Global Times, the English-language newspaper of the Chinese Communist Party, used Twitter to criticize the president of the House of Representatives. “Pelosi once referred to the Hong Kong riots as” a beautiful sight to behold “. It is unknown whether the same will be said about events at the Capitol”, forgetting to say that Nancy Pelosi’s statement referred to demonstrations then peaceful. Furthermore, it is a false equivalence: Hong Kong activists demand more democratic freedoms and Beijing’s non-intervention in that partly autonomous territory; Trump’s faithful tried to subvert the outcome of elections considered fair, with the exception of the defeated candidate and his neighbors.
Even so, regime propaganda flooded the internet, with more than 570 million people following hashtag “Trump supporters assault the Capitol” on the Weibo social network. Foreign Ministry spokeswoman Hua Chunying said the “sharp contrast [nas reações] it gives you thinking and deserves serious and profound reflection “.
Russia of Vladimir Putin, who had Trump as a confessed but lonely admirer in Washington, also took the opportunity to express his point of view. “The United States certainly cannot now impose electoral rules on other countries and claim to be the “beacon of democracy” in the world “, said the head of Foreign Affairs in the lower house, Leonid Slutsky. “It is evident that American democracy is limping on both feet,” said the Duma upper house counterpart Konstantin Kosachyov. “The celebration of democracy is over. Unfortunately, it hit rock bottom, and I say this without a hint of rejoicing,” he said.
Recalling that the Chinese Communist Party has characterized the United States as an “unstable, disorderly and unjust democracy” since the days of Mao Zedong, Chinese affairs experts Jude Blanchette and Michael J. Green say Xi Jinping will “exploit domestic dysfunction” of China’s biggest geopolitical rival as a central component of its political platform “. Like? “Now, Chinese negotiators will sit across the table with American interlocutors imbued with a sense of moral rectitude, in addition to their warrior-wolf diplomacy,” they write in Foreign Policy.
“We hope to take a stronger position on China than has happened in previous Democratic administrations,” said a Biden adviser. to The Washington Post.
This position will take shape in the National Security Council, created more than 70 years ago and which will be reformed. In the restructuring of this body, which aims to coordinate the diplomatic and military fronts in the White House, there will be experts at the table in the areas of health, democracy and human rights, technologies and climate – in the latter case, it will be John Kerry, the former secretary of State, who will be the envoy for climate issues.
Other changes to the body headed by Jake Sullivan, which recovers a number of elements from the Obama administration, include having a director dedicated to Russia, as it did until Trump arrived at the White House. The Kremlin does not expect “anything good” from the Biden government, as Deputy Foreign Minister Sergei Riabkov said. And you will have your reason. With Putin’s Russia gone, the time has come to try a fresh start, as Hillary Clinton rehearsed. The future Secretary of State Antony Blinken is expected to put more pressure and even sanctions on Moscow, related to the poisoning of opponent Alexei Navalny.
On two other countries that once were part of the “axis of evil” designated by George W. Bush, Iran and North Korea, Biden and his team are facing a minefield. In the first case, they want Tehran to return to the nuclear agreement, so they will also have to undo the departure of the US ordered by Trump, but also to reinforce the pact beyond the purely nuclear issue.
With Pyongyang, Biden’s advisers want to leave behind the policy followed during the Obama years, and to resume talks initiated by the outgoing president. The priority will not be to get a big deal, as Trump has attempted, but a phased denuclearization, in which the priority will be to contain the nuclear threat that hovers under American territory today.
Regarding Venezuela and Cuba, policy changes are expected, with a return to an opening towards Havana and a new approach towards the Nicolás Maduro regime. After supporting the attempt to overthrow the regime, Democrats will want negotiations in exchange for lifting sanctions.
Trump faces second dismissal
In a dramatic change of tone, Donald Trump has declared that he will secure a “smooth and orderly” power transition, but he has not convinced critics. Once the hypothesis was dismissed, by Mike Pence, of the removal of Trump by the vice president and part of the government or part of the Congress, invoking the 25th amendment, the House Speaker Nancy Pelosi announced that she would start the procedures for the removal of the president who will step down on the 20th. A Republican senator, Ben Sasse, was in agreement with the initiative.
A speaker he also said he spoke to the military chiefs, asking them to do everything they could to protect Americans from an “unbalanced” president.
The tension between China and taiwan increases after the presidente chino, Xi Jinping, order the Army to be prepared “for the combat full time “using the high technology available to them ins military exercises, in his first decree of 2021.
Xi specified that the gigantic People’s Liberation Army must be ready to “act at any time, carrying forward the spirit ofe fight without fear to difficulties and without fear of death. “
The Armed Forces cthe military exercises after receiving the order of the president, carrying out maneuvers throughout the country along with computer simulations on the use of their nuclear weapons.
Air raids in Taiwan
Xi’s order comes amid mounting military tensions between Taipei and Beijing, after Taiwan denounced that Chinese military aircraft made 380 sorties in the area of island defense in 2020, a record figure.
Taiwan, who enjoys a democratic system, lives under the constant threat de China, who considers the territory as a rebellious province that one day will be under your control, by strength if required.
The tensions on both sides of the Strait of Formosa have risen steadily since the 2016 election of the president Tsai Ing-wen, from a party traditionally hostile to Beijing.
See: Trump warns: “They are not going to take the White House, we will fight to the end”
But they peaked last year with the unprecedented number of aircraft sorties from the Chinese Air Force in its air defense identification zone (ADIZ).
“The 380 raids in the southwest of the ADIZ in 2020 were much more frequent than in the past,” said Defense Ministry spokesman Shih Shun-wen.
“This … constitutes a threat for regional and national security, “he added.
The National Defense Research Institute, in its annual report on the Chinese People’s Liberation Army, warned that “the China’s military threat, is at its highest level since the crisis of the missiles from 1996 en the strait. “
NAfter the post-Brexit trade agreement with Great Britain, the EU is finally finalizing an extremely important agreement. At the beginning of the German EU Presidency in July, Chancellor Angela Merkel (CDU) named an investment agreement as one of the central goals of this presidency; The signing was planned at an EU-China summit in Leipzig in September. It was canceled due to the pandemic – and after an alternative video conference between EU leaders and party leader Xi Jinping, which was arranged at the time, it did not look as though both sides would agree on an investment agreement that would give the European company better market access in China and Beijing secures final recognition as a geostrategic power.
But in the two weeks before Christmas things suddenly happened quickly. Immediately before Christmas, the responsible negotiators, Commission Vice Valdis Dombrovskis and China’s Deputy Prime Minister Liu He agreed on a draft contract, Xi Jinping and the three top EU representatives Ursula von der Leyen (Commission), Charles Michel (European Council) and Merkel for the German Council Presidency want to seal this Wednesday. It should take months before it is ready for signature because of the clarification of legal issues and the translation – but the content is apparently no longer in dispute.
Investments in all branches of the economy possible
According to the EU Commission, the agreement rests on three pillars. First, China is granting European companies far more access than before. In the future, these could invest in all sectors of the economy, including the automotive industry, the market for cloud services, financial services and healthcare. Second, fair competitive conditions (“level playing field”) are guaranteed in the future. This means new rules against the forced transfer of technology as well as new obligations for state-owned companies and comprehensive transparency for subsidies. Third, standards for “sustainable development” should be observed. This should especially apply to the working conditions in companies.
China has promised to undertake “sustained and sustained efforts” to ratify the Ilo Convention on Forced Labor, it said. In addition, the EU will autonomously develop further instruments to combat forced labor. The result of the negotiations is the most ambitious that China has ever agreed with a third country, the commission said. For the first time, China agreed to solid rules for sustainable development, also with a view to the environment and climate.
Great time pressure
The EU Commission sells the content of the agreement as a complete success for the European side – as if China had gained practically nothing apart from more legal certainty. What is certain, however, is that Beijing has received a clear geostrategic advantage. This advantage is also considered to be the reason why the agreement has now been negotiated under time pressure. The new American administration wants to take a tough political line with Beijing.
According to Brussels diplomats, after President Joe Biden took office on January 20, the EU would have been forced to follow this line in the interests of improved transatlantic relations. “Then the negotiations with China would have run out of steam,” as one diplomat put it.
The investment agreement must be approved by the EU member states and the European Parliament. While the representatives of the member states already signaled their approval in principle on Monday, criticism arose in parliament on Tuesday. The Greens parliamentarian Reinhard Bütikofer said there was “no plausible reason for pushing through this agreement with maximum year-end hectic”. On the subject of forced labor in China, the Commission contented itself with “superficial lip service” instead of insisting on a timetable for the ratification of the key Ilo conventions.
In addition, it is regrettable that the Commission and the German EU Council Presidency did not even try to take their declarations of intent for renewed transatlantic cooperation with China so seriously that they left room for the consultations that should actually follow from it and from Biden team are expressly desired, it said. “In this way you can degrade your own statements to talk and make it more difficult to overcome transatlantic ruthlessness such as the one that shaped the Trump era,” criticized Bütikofer.
On December 31, 2019 – an eternity ago – China officially notified the WHO of the emergence of a “Atypical pneumonia” in the city of Wuhan, without specifying its high human-to-human contagiousness and taking care to muzzle the citizens’ voices which sounded the alarm. A year later, eight hundred times less affected, in proportion of the population, than the United States (and five hundred times less than France), the Middle Empire is proud of having triumphed over Covid-19. Even if we must be wary of official figures, we can see that the hospitals are not under pressure, that the Chinese are living almost normally again and that the economy is on the rise again, while we remain hampered between confinement and blanket. -fire, burdened by recession, debt and unemployment.
What happened? Red dictator Xi Jinping believes he has demonstrated the superiority of “Socialist model with Chinese characteristics” on our muddled and rebellious democracies. For having put in isolation
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Is he Businessman China’s most famous and the symbol of “self-made man” for his compatriots. At 56 years old, Jack Ma will have to deal with the revenge of the authorities, who seem determined to clip his wings.
This Thursday, the State Administration for Market Regulation of China shook the Chinese business world, where Alibaba and its charismatic founder Jack Ma symbolize the success of e-commerce, by announcing that this internet giant will be investigated for “suspicious monopoly practices.”
It is former English teacher, officially ‘retired’ since last year from Alibaba received an affront from financial regulators, who also contacted Ant Group, a subsidiary of Alibaba, the world leader in online payments and of which Ma is the largest shareholder, to talk on “supervision and advice”.
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This happened a few weeks after Beijing frustrated at the last minute the IPO of the company, with which Jack Ma thought his fortune would exceed 70,000 million dollars (60,000 million euros).
This fiasco cost Jack Ma billions, even causing him to lose China’s first fortune title, estimated at $ 58 billion.
The power of President Xi Jinping seems determined to fight the monopolistic tendencies of private groups like Alibaba, whose online sales platforms are used by hundreds of millions of Chinese.
An unprecedented setback for this millionaire, who anticipated before anyone else the evolution of his compatriots towards electronic commerce when he co-founded Alibaba in 1999.
The Chinese media often recall his humble origins, a father who struggled to feed his family, his poor school results and the small, poorly paid jobs until the creation of Alibaba in an apartment in Hangzhu, eastern China, with a capital of $ 60,000 that he borrowed from friends.
Jack Ma (whose Chinese name is Ma Yun) decided to abandon his profession as a university teacher after discovering the internet and the possibility it offered to companies to exchange their assets online.
This man quickly understood the potential of smartphones and pioneered, with his Alipay service, electronic mobile payment, now ubiquitous in China, earning a reputation as a visionary.
Michael Jackson and the communist party
“The first time I used the Internet, I typed and said to myself: ‘This is something that is going to change the world and China,'” he told the US television network CNN.
The take-off of Alibaba’s online trading platform, Taobao, forced US eBay to practically withdraw from the Chinese market in 2006, giving way to its rival.
Jack Ma is known for his eccentricities, in a rather serious Chinese business world. Much admired by his employees, he has often been compared to Steve Jobs, the legendary Apple co-founder, although his style is more relaxed.
The successful and atypical businessman is at the same time an adept of tai chi, traditional Chinese gymnastics for inner and physical balance, took the stage at a company party disguised as Michael Jackson and is a member of the very austere Chinese Communist Party (CCP) in power .
From Davos to Wall Street, he has rubbed shoulders with global personalities and promised Donald Trump to create one million jobs in January 2017, when the American billionaire was due to enter the White House.
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He then withdrew that promise, using the argument from Trump’s trade war against China.
In September 2018, Jack Ma announced that he would retire a year later, when he turned 55, to dedicate himself to philanthropic projects in the educational field, something that recalled the path followed by one of his models, the founder of Microsoft, Bill Gates.
His rise always earned criticism and enmity at the top of the communist party.
Jack Ma may have to rethink the slogan that has presided over his career and that he clearly set out in 2007 at Davos, the world finance event: “My philosophy is to be in love with power without marrying it.”