Policy briefs

ReConnect China Policy Brief 14: Getting China Onboard a Global Debt Governance System (9/6/2024)

China has become the number one provider of development finance in the world. Because of its significant share in Low and Middle Income Countries’ (LMICs) external debt, China should take up responsibilities and cooperate with traditional development finance providers, but its particular lending style and distinct approach to debt management pose many challenges and do not make international cooperation straightforward. Although some progress could be observed over the past couple of years under various initiatives such as the Debt Service Suspension Initiative, the Common Framework and the Global Sovereign Debt Roundtable, more remains to be done. But as China is increasingly faced with the same difficulties as other lenders, and in particular with rising risks of default, one may be reasonably confident that China will behave increasingly like other lenders.

Policy recommendations

  • In concrete terms, the EU should push the topic of debt management on the G20 agenda so as to encourage a constructive discussion with China. It is also important to avoid ill-founded criticisms that are simply counterproductive. The EU should call for more transparency and encourage the streamlining of lending practices and approaches to debt restructuring.  It is in all countries’ interest to design an effective multilateralized debt management mechanism.

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Reconnect China Policy Brief 13: EU’s Technical Dependencies towards China (9/3/2024)

In recent years, the European Union (EU) has increasingly relied on China for critical technologies, pivotal for its digital and green transition. As the market of electric vehicles (EV) grows rapidly, demand for critical inputs has also soared, including lithium-ion batteries. China holds a dominant position along the EV battery supply chain, which has resulted in high exports to Europe and growing integration with the EU market. The EU finds itself in a delicate position, faced with the challenge to disentangle from dependencies on Chinese critical technologies, while preserving foreign investments in critical sectors and boosting local manufacturing capacity. Several measures have been introduced at the EU level, but a more all-round approach and longer-term industrial policies will be needed to scale up the EU’s de-risking capacity.

Policy Recommendations:

  • Prioritise innovation to reduce current dependencies
  • Promote green-er technologies
  • Diversify the most critical gaps of the supply chain
  • Pursue a cohesive and shared approach across EU Member States

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ReConnect China Policy Brief 12: Knowledge and Perception of Research Security (8/23/2024)

Research security was high on the agenda of the outgoing European Commission as evidenced by a series of policy documents, most notably in the Economic Security Strategy package put forward in May 2024. Research security can only be effective if policy is translated into practical solutions through easy-to-use tools, balancing openness and safety.

This policy brief aims to draw practical conclusions and provide recommendations on how to support researchers aiming to collaborate with China in light of the ongoing policy debate on research security. The recommendations are based on the main findings of an online survey conducted with 24 Austrian scientists on the topic of research security in the context of cooperation with China.

The results of the survey show a fundamental lack of knowledge about research security related terms, as well as on the current policy strategies and recommendations shaping the research collaboration between the EU and China. There is an urgent need for support measures in assessing the security risks associated with potential Chinese partners, including dual-use aspects.

Even though responses were gathered from very diverse scientific fields, there seems to be a consensus among scientists who have already worked with Chinese partners that cooperation should continue but in a recalibrated way that ensures mutual benefits and transparent knowledge transfer and data use.

Policy recommendations:

  • A more systematic, European-level data collection and analysis should be conducted on research security aspects in the context of cooperation with China;
  • An in-depth discussion, facilitated and/or supervised by policy makers in charge of the topic on knowledge security, should be held at European, national, and university levels to recognise the risks associated to research cooperation with China and to inform the design of related policies for the three respective levels;
  • Developing guidelines on how to effectively collaborate with China without worrying about ideas or technologies being ‘misused’ should be given to interested researchers and institutions;
  • A European university tracker for China should be developed with the aim of assessing the research security risks associated with Chinese institutions;
  • Decision-makers in each relevant scientific field should come to an agreement on how to subsequently cooperate with Chinese partners. Such future directions might also cover restrictive measures ideally applicable at the national or European level.

Whereas the latest EU Recommendation on research security in international cooperation from May 2024 includes proposals for similar initiatives, our recommendations are “China-specific”. We consider China a unique case for international research cooperation, requiring case-based information gathering and policy development to serve the needs of European researchers in tackling the complexities that arise when engaging in cooperation activities with their Chinese counterparts.

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ReConnect China Policy Brief 11: The Chinese AI Innovation Ecosystem (6/27/2024)

Based on its 2017 development plan for Artificial Intelligence (AI), China aims to become the world’s main AI innovation centre by 2030. To achieve this goal, China’s strategy is to cultivate an open and sharing AI innovation ecosystem through the construction of AI Open Innovation Platforms (OIPs) and AI Pilot Innovation Zones (PIZs), of which there are currently 23 and 18, respectively. PIZs can be deemed as the innovative environment and OIPs as the medium, which exist in a symbiotic relationship. OIPs focus on one specific key subfield of AI, and the construction is contracted out to a leading private enterprise or research institute in each subfield. In the benign scenario, AI start-ups and small and medium-sized enterprises (SMEs) can access quality data, algorithms, and computing power to train their AI services and products. Meanwhile, the PIZs share their successful experiences with other regions to replicate. Technology diffusion then enhances AI innovation capabilities and SMEs can bring more competition into their fields. However, as OIPs are mostly constructed by leading private AI enterprises and their standard-setting power is reinforced when all start-ups and SMEs in the same field use their software and hardware, they may abuse this dependency and become uncontrollable giants. In such an adverse scenario, selected subfield leaders can turn into consolidating monopolies, thus reducing competition. Moreover, China’s internal “brain drain” towards major innovation hubs within the country might accelerate, resulting in even larger disparities among regional talent pools. Recent policies, such as the Personal Information Protection Law, and an AI-related 2022 revision to China’s Antimonopoly Law aim to reduce these dangers.

Policy recommendations:

  • Increase the EU’s understanding of China’s fast changing AI landscape by collecting regularly updated information on new developments in AI innovation in China, and funding related research through EU funding instruments.
  • Deepen analysis of the role that the Chinese government plays in cultivating the AI innovation ecosystem.
  • Ensure that European enterprises have the same chances to apply for the construction of a Chinese OIP, and equal access to the OIPs if carrying out business activities in China (maintaining a level playing field).
  • Encourage Chinese policymakers to share their experiences on AI governance with EU policymakers.

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ReConnect China Policy Brief 10: Rethinking China’s COVID-19 Aid Diplomacy in Europe (3/19/2024)

This policy brief re-examines China’s COVID-19 aid diplomacy in Europe during the first wave of the COVID-19 pandemic in 2020, focusing on the scope of donation and associated disinformation. China’s aid diplomacy in Europe was widely seen as an attempt to demonstrate China’s global pandemic response capacity while obscuring the CCP’s early missteps during the outbreak. This brief uses a novel dataset to provide fresh insights and important distinctions into the underlying motivations behind China’s aid efforts. Along the EU’s strategic autonomy agenda, this brief provides key policy recommendations to improve the EU’s pandemic preparedness, and to upgrade its role in shaping global health governance by urging the EU to secure a pandemic treaty and diversifying supply chains to move beyond the current globalism-statism divide.

Policy Recommendations:

  • Strengthen the EU’s capacity to manage global health risks through more active cooperation with non-EU partners via the EU’s Global Health Strategy and Global Gateway.
  • Develop a more comprehensive EU-wide strategy to counter disinformation narratives amplified by the CCP’s growing media apparatus,  by investing more in the EU’s media literacy.
  • Bolster the pandemic preparedness and resilience of the EU’s emergency response capabilities by diversifying and upgrading supply chains.

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ReConnect China Policy Brief 9: Geopolitical Narratives Are Counterproductive (2/19/2024)

This policy brief maps the origins, shortcomings, and potential implications of a geopolitical reading of the Global Gateway vis-à-vis the Belt and Road Initiative. Despite the obvious geopolitical implications of such initiatives, it is argued that framing Global Gateway in a reactive and competitive geopolitical narrative could reduce its appeal to stakeholders in the Global South and strain its relationships with China. Therefore, it is proposed to focus Global Gateway narratives on a proactive and positive agenda aligned with the national priorities of the partner countries and globally accepted goals such as those included in the 2030 Agenda.

Policy recommendations:

  • Avoid a reactive and competitive geopolitical framing of the Global Gateway.
  • Emphasise a proactive and positive agenda in the narratives of the Global Gateway putting the focus on cooperation with partners along the Global South and Sustainable Development Goals.
  • Increase ownership and the sense of ownership among partners from the Global South.

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ReConnect China Policy Brief 8 China in the Middle East: Consequences for Europe (1/20/2024)

This policy brief attempts to describe and assess China’s penetration of the Middle East, as it strives to deliver on its security requirements along its maritime routes, as well as to develop export markets and economic partnerships with the region. The paper further aims to gauge to what extent Europe has risen to the serious challenge that China has presented.

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Reconnect Policy Brief 7 Xi-curity: How economic security ideas shape China’s economic strategies (1/12/2024)

In the run-up to the December EU-China summit in Beijing, tension loomed over issues like the EU’s anti-subsidy investigation in China’s electric vehicle sector, the carbon border adjustment mechanism (CBAM), and Dutch restrictions on silicon chip technology exports. Chinese authorities are criticizing President von der Leyen’s economic de-risking policy, labelling it a dictated containment policy by the US. This criticism is peculiar when considering China’s longstanding concerns and policies to cope with foreign overreliance, now amplified under Xi Jinping. Since his Presidency, large parts of the economy have been placed in function of China’s national security. The EU belatedly recognized the strategic potential of economic assets, and currently responds to Chinese (and American) geo-economic power politics with some new initiatives. Yet, defensive, ad hoc measures to protect its increasingly limited industrial assets will not suffice.

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ReConnect Policy Brief 6 Policy Orientations on EU-China Relations in Semiconductors: An outlook on bilateral and multilateral agendas (11/22/2023)

The international agenda on semiconductors is not only a matter of U.S.-China rivalry. Also, the EU plays a major role, in terms of economy, industrial policy and security. Moreover, jointly with EU institutions, each Member State needs to decide which approach to semiconductors, to China and to global technology governance it aims to undertake. Semiconductors have been embedded through an economic security outlook. However, this area cannot be only addressed on a bilateral basis. The understanding of how the EU’s own technology partnerships with third countries are framed will provide policy guidance on how the Union may approach China, in their own mutual relationship and in how both sides reflect their own agendas within international fora and multilateral dialogues where semiconductors play an increasingly strategic role. ReConnectChina_Policy Brief 6_Semiconductors

ReConnect China Policy Brief 5 on Navigating EU-China Investment Dynamics: Safeguarding Technological Know-How while fostering Cooperation (11/13/2023)

China’s investment and acquisitions in the European Union have increased significantly in recent years, raising concerns about their impact on European economies and security. The dynamics of the EU-China relationship have evolved significantly over time, with the past year marked by a deterioration in bilateral relations. This deterioration has been linked to a growing number of issues, such as China’s responses to EU sanctions on human rights, economic coercion affecting the single market, and its stance on the Ukraine conflict. The EU faces the complex challenge of dealing with China as both a negotiationg partner, economic adversary and systemic competitor. This complexity characterises the current state of EU-China relations, where a variety of challenges and opportunities are emerging, driven by intertwined economic, political, and strategic factors. ReConnectChinaPolicyBriefSafeguardingTechnologicalKnowHow

ReConnect China Policy Brief 4 assesses China’s Lunar exploration program in competition with the United States (11/13/2023)

A new Cold War-style race to the moon seems to be in the making. The People’s Republic of China and the United States are both investing in moon exploration with manned lunar scientific stations as the ultimate goal. The comparison with the 1960s has its limits, nonetheless, because this time the race is not only to tuch down the moon’s surface and return to Earth, but to promote a long-term scientific development on the moon and far beyond. This ReConnect China Policy Brief breaks down the state of play of the China-US race to the moon, and considers the strategic ambitions, technical requirements, and necessary diplomatic support for such a great aim. ReConnect China-Policy Brief_Racing to the moon

ReConnect China Policy Briefs no.2 and 3 draw policy recommendations on EU-China STI cooperation in the big data-related scientific fields (10/13/2023)

Based on the comprehensive report on EU-China STI cooperation in the big data-related scientific fields (artificial intelligence, big data and machine learning), two more policy briefs were published by the project. We used the report’s key results and aimed at embedding them in the overall policy discourse and legislative framework pertaining to science and technology cooperation between the EU and China. As a corollary, current developments in STI policy-making both on the EU’s and China’s side are explained, with a particular focus on the question how both actors aim to govern the future proliferation and protection of data stemming from research on AI, BD and ML from a legal viewpoint. The policy briefs conclude with a list of policy recommendations addressed both to the EU and the Member States level. While any risks or unfavourable conditions in research cooperation with China that could potentially conflict the EU’s interests and values must definitely be taken into account, we recommend European R&I actors to take case-by-case decisions on concrete research cooperation offers from their Chinese counterparts that are grounded in information provided by specific risk assessment and due diligence services.

ReConnect China Policy Brief 1: ‘Remonstrating,’ or the Art of Forging Relations (Bart Dessein & Jasper Roctus) (5/29/2023)

“Why does an adviser have the duty to remonstrate with his ruler? Because he exhausts his loyalty and gives [him] his sincerity. In the Analects it is said: ‘If one loves someone, could one refrain from cheering [him] on? If one is loyal to someone, could one refrain from teaching [him]?’” (Discussion in the White Tiger Hall (Baihutong 白虎通), Vol.4: Remonstrance (Jianzheng 諫諍).1 This appeal that dates back to the beginning of the Common Era appears to still have its value in shaping great power relations in the contemporary era.

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