Such open criticism is rarely heard in China and it is also one of the head of state and Xi Jinping’s party’s favorite projects, the aspired self-sufficiency of the Chinese economy. But that’s exactly what the European Chamber of Commerce in Beijing warned Thursday. The Chinese government should abandon its strategy of strengthening independence so as not to risk compromising innovations and growth prospects, said Chamber President Jörg Wuttke.
Many companies once again achieved record sales and profit figures last year, which is unlikely to change in the near future. In the short term, too, the outlook for European companies operating in China has remained broadly positive. However, there are “worrying signs” that China is increasingly turning in on itself. “This trend raises considerable doubts about the country’s future growth trajectory,” Wuttke said, referring to the new five-year plan adopted by the National People’s Congress in March, which clearly indicated the path “to reduce dependence on -visited from the rest of the world and ultimately to a high degree To achieve self-sufficiency “.
The five-year plan foresees that research spending will increase by more than seven percent per year, and that the money will mainly go to seven key areas: artificial intelligence and quantum information, brain research, semi-construction. -conductors, genetic research and biotechnology, clinical medicine. Beijing is thus joining an initiative included in the last five-year plan: “Made in China 2025”. A large-scale state plan for a whole new industry. The economic planners had selected ten industries: including the automobile and train, aircraft construction, digital production or the pharmaceutical industry – the People’s Republic is on the way to becoming a world leader everywhere. The state generously contributes to funding research and loans from state banks.
“Made in China 2025” has already been criticized in Brussels, Paris, Berlin and Washington – it is unfair competition. However, the current economic policy goes much further: dependence on the rest of the world must be reduced – the trade and technology war with the United States or the global economic slowdown caused by the corona pandemic should be able to have much less impact on the Chinese economy in the future. To this end, President Xi pursues the strategy of “double cycles”, which continues to emphasize the opening up of China, but emphasizes the promotion of the domestic market as the main driver.
Experts are already talking about a “major shift in China’s economic policy”: demand in China must be stimulated, billions for research and development must be made available for so-called internal circulation. The “external cycle”, like international trade and investments from abroad, only has a supporting role. The Chamber of Commerce also complains, “Members of the European Chamber of Commerce are very concerned about the extent to which they will be able to contribute to China’s future economic growth,” Wuttke said.
European Chamber of Commerce receives flank protection from Federation of German Industries (BDI): “Beijing’s focus on self-sufficiency and national security darkens prospects for European companies in the world’s largest growth market” , said Joachim Lang, CEO of BDI. . “The success of foreign companies in China increasingly depends on their integration into Beijing’s national agenda. And even many Chinese private companies are now feeling the pinch: Executives have been taking action against tech companies, online retailers and the real estate industry for months. It is becoming more and more difficult in the People’s Republic.