China's crossroads of crisis: Europe 'de-risking', Country Garden and Xi's policy problems
Sep 10, 2023
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EU response to Xi's absence at G20, 'de-risking' strategy in EU, Beijing's reception of Germany's far-right party, Country Garden's financial crisis, challenges for Xi Jinping's central government
European frustration with China's opaque elite politics and lack of clarity in its actions affecting understanding of China's direction.
The challenges faced by the European Union in reaching consensus on critical technologies and navigating through a changing political landscape.
Deep dives
China's geopolitical issues and European frustration
There is uncertainty surrounding Chinese President Xi Jinping's decision not to attend the G20 summit. The Europeans were disappointed as they wanted to discuss key issues with him, such as the Russian invasion of Ukraine. Europeans are frustrated by China's intransigence and its opaque elite politics. The lack of clarity and the unpredictability of China's actions are making it difficult for European nations to understand the direction in which China is headed.
De-risking strategy and challenges in the EU
The European Union has proposed an economic security strategy called de-risking in order to protect critical technologies and impose restrictions on outbound investments. However, member states have shown pushback against the proposal due to concerns about centralized control and the impact on national security and free trade practices. The U.S. has also implemented outbound investment restrictions which may indirectly affect Europe. The EU faces challenges in reaching a consensus on critical technologies and navigating through a changing political landscape due to upcoming elections and shifts in key positions.
The German far-right party's visit to China
The German far-right party, AFD, sent a delegation to China, despite concerns about their ideology and controversial positions. China extended a warm welcome to them, possibly due to China's pragmatic approach of engaging with relevant parties. The conflicting ideologies of the AFD and the Chinese Communist Party seem to find common ground when it comes to certain nationalist tendencies. This unexpected alliance raises questions about the motivations behind the visit and the potential implications for China-Germany relations.
Country Garden's financial difficulties and implications
Country Garden, one of China's largest property developers, teeters on the brink of default due to significant debt and challenges in the real estate market. The Chinese government is cautious about providing a massive stimulus and is focusing on restoring confidence rather than solely relying on financial resources. The company's financial situation has implications for the Chinese economy and the property market. Its ability to meet its debt obligations and maintain cash flow will impact the broader market and investor confidence.
Finbarr Bermingham reports on the EU response to Xi's absence at the G20, how 'de-risking' is playing out, and Beijing's reception to Germany's far right populist party AfD; Chad Bray analyses China's property giant Country Garden, its teetering on the brink of default and the forecast for what comes next; Zhou Xin looks at the big picture of the challenges for Xi Jinping and his central government.
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