"A Wake-Up Call for Europe"

German government advisors call for a "consolidated stance by the EU" in relationship to China the "winner in the crisis."

BERLIN/BEIJING | | china

BERLIN/BEIJING (Own report) - German government advisors see China as the "winner in the Corona crisis" and call for a "strong and consolidated stance by the EU" in relationship to the People's Republic. With "effective crisis management," Beijing has enhanced its global economic and political influence, according to a recent analysis published by the German Institute for International and Security Affairs (SWP). Having long been accustomed to dominating international politics, the West must now expect China to play a more "assertive" role, the SWP writes. The People's Republic has, in fact, been successful in fighting the Covid-19 pandemic at home, thus laying the groundwork for the economic recovery that is now enhancing its clout vis à vis the EU and the USA. With its Covid-19 vaccine supply, it can now also strengthen its position in various Asian, African and Latin American countries, whose plight has widely been ignored by the like-wise pandemic-stricken Western powers. The new free-trade RCEP agreement is also perspectively helping to shift the center of gravity of the global economy toward Asia.

Successful in Fighting the Pandemic

China's "apparently having overcome the pandemic" is the basis for its increasing power in this waning crisis year, notes the German Institute for International and Security Affairs (SWP) financed by the German Chancellery.[1] In China, daily infections remain in the lower double-digit range - primarily due to travelers entering from abroad - and very few casualties, compared to daily infections in the five-digit and casualties in nearly a four-digit range, in Germany alone. Whereas the end-of-the year festivities in Germany are overshadowed by drastic restrictions, "hundreds of millions of Chinese were traveling throughout the People's Republic already during the 'Golden Week' national holiday at the beginning of October," the SWP reports. This apparent success is also perceived as such within the country. "The majority of the population approves of the measures," Beijing had taken to fight the pandemic, SWP writes. According to a survey by YouGov-Cambridge Globalism Project, "88 percent of the Chinese are convinced of their government's leadership in the Covid-19 crisis." One can perceive a "political consolidation" within the People's Republic.

Shifting Balance of Power

The Chinese economy is experiencing a similar positive development, which, according to the SWP, is registering the much-discussed - but virtually nowhere achieved - "V-shaped economic recovery." The People's Republic has, in fact, managed to offset the dramatic economic slump in the first quarter by 6.8 percent compared to the same period last year and to rapidly generate new growth. According to recent projections by the Organisation for Economic Cooperation and Development (OECD), China is the only G20 member country that was able to end the 2020 crisis year with a greater economic output than in 2019 - with a plus of 1.8 percent. The OECD anticipates the annual GDP of the United States to decline by 3.7 percent, that of Germany by 5.5, and that of the Eurozone by 7.5 percent. Whereas - also according to the OECD projections - Germany will reach its economic pre-crisis level only in 2022, the Eurozone presumably only by 2023, China will be able to increase its economic output by an astonishing 15 percent in 2022 compared to 2019. By then, the US economy will have an increase of only 3 percent over the pre-crisis level.[2] "The balance of power in the global economy" will thus shift "in China's favor," the SWP notes.[3]

The New Global Economic Center of Gravity

Last year, in spite of the Corona crisis, Beijing was able to achieve a possibly long-term trade policy success with the November 15 signing of the Regional Comprehensive Economic Partnership (RCEP) free trade agreement. The agreement links China to the ten members of the Association of South East Asian Nations (ASEAN), Japan, South Korea, Australia and New Zealand. It is not considered a particularly ambitious accord; however, stretched over years, it would only eliminate 90 percent of the import tariffs on commodity trade and bring about much less liberalization in the service sector than other agreements. On the other hand, it encompasses nearly a third of the world's population and represents 30 percent of the global economic output - more than the countries in the United States-Mexico-Canada Agreement, (USMCA, previously NAFTA) and much more than the EU. Above all, it consolidates, for the first time, the nations of the Asian-Pacific boom region without direct participation of the old transatlantic West. This is significant because experts consider that, in the long run, with its clout, the RCEP could set global economic standards. "As one of the main driving forces" Beijing underlines "its role as a global formative power" acknowledges the Federation of German Industries (BDI): RCEP is "a wake-up call for Europe."[4]

Vaccines for the Non-Western World

Additional new gains in global political influence have resulted from China's active role in the global battle against the Covid-19 pandemic. Whereas the western nations - in spite of all their verbal affirmations to the contrary - have reserved the major portion of the available Covid-19 vaccines for themselves, showing little interest in the welfare of poorer nations, the People's Republic of China has long since begun to export vaccines to the countries outside the affluent western world and to provide licenses to pharmaceutical companies and institutes, including those located in Indonesia, the United Arab Emirates, and Brazil for the production of Chinese vaccines for the respective regions. (german-foreign-policy.com reported.[5]) For the African countries, Cainiao, the logistics subsidiary of China's Alibaba group has established, in cooperation with Ethiopian Airlines - the largest airlines on the African continent - the necessary supply chain for the distribution of the vaccine. Earlier, in collaboration with the founder of the Alibaba Foundation, Jack Ma, Ethiopian Airlines had already delivered more than 3,000 tons of Covid-19 aid supplies from China to Africa, Asia, and Latin America. The fact that the People's Republic of China is helping poorer countries that the West refuses assistance is not without consequences.

Cooperation Partner and Rival

"China's effective crisis management," assesses SWP, "identifies that country, at the end of 2020, as the winner in the crisis."[6] Whereas, for a long time, the West has been accustomed to dominating world politics the think tank in Berlin is now warning that Beijing will possibly "be more assertive ..., than it already is." "It is all the more important" that "the EU assumes a strong and consolidated stance in relationship to China." Germany also must "apply the European strategy in practice ... which stipulates that China is a cooperation partner and economic competitor, but also a systemic rival." Perspectively, the SWP thus aims at intensifying political and possibly even military pressure on Beijing ("systemic rival"), while maintaining the indispensable economic cooperation for German industry (China as a "cooperation partner."[7]) Efforts toward these ends are already in progress - german-foreign-policy.com reported.[8]

 

Please take note of our video column "War Against China".

 

[1] Hanns Günther Hilpert, Angela Stanzel: China - Pandemiegewinner für den Moment. SWP-Aktuell Nr. 99. Berlin, Dezember 2020.

[2] OECD Economic Outlook. December 2020.

[3] Hanns Günther Hilpert, Angela Stanzel: China - Pandemiegewinner für den Moment. SWP-Aktuell Nr. 99. Berlin, Dezember 2020.

[4] Starkes politisches Signal. bdi.eu 17.11.2020.

[5] See also Der Westen zuerst.

[6] Hanns Günther Hilpert, Angela Stanzel: China - Pandemiegewinner für den Moment. SWP-Aktuell Nr. 99. Berlin, Dezember 2020.

[7] See also Geschäft statt Entkopplung.

[8] See also Das nächste Operationsgebiet der Bundeswehr.