Analytics, China, Direct Speech, EU – Baltic States
International Internet Magazine. Baltic States news & analytics
Friday, 29.03.2024, 02:38
China is ahead in the game – where is Europe
China is big, thinks big, and does big in every sector.
Around 18% of the world’s population lives in China. At the same time, China’s
share in global gross domestic product adjusted for purchasing power-parity is
over 15%. China holds a place among the world’s fastest growing economies. The
value of China - Europe trade alone is on average over €1 billion a day.
Like the economy, infrastructure development and mobility have
seen huge growth in the last decade. Over half of the world’s highspeed railway
network is in China. And Chinese high-speed trains are getting faster. China is
researching next-generation maglev trains that could eventually reach
theoretical maximum speeds of 4,000 kilometers per hour. Infrastructure
development ambitions are not limited within the Chinese borders, as reflected
in China’s call for a new Sino-European Silk Road.
The investments in infrastructure are being paralleled with
investments into academics. The reputation of China’s education sector has been
improving with an increasing number of Chinese institutes lifted onto the Times
Higher Education World University Rankings list.
The growth has not come without an environmental price. China
has challenges with environmental degradation, air pollution, and waste
management, for example. China has plans to address these. China is a leader
when it comes to clean energy investments, with plans to invest over €300
billion into renewable energy generation by 2020. China also has a circular
economy strategy and law, following the inclusion of the concept in both the
12th and 13th Five-Year Plans. From the planning phase, industry is designed to
ensure that waste from one industrial process can provide efficient and
effective input to others. From January this year, Chinas has refused to accept
imports of plastic scrap, textiles or mixed paper imports, including from
millions of metric tons of low-grade waste from EU countries. While China is
determined to make use of recycled materials from its own domestic market, it
also forces the EU to find alternative solutions for what to do with materials
previously collected and exported to China.
Chinese growth is taking place in a global environment, where discussions about peak-oil, reducing stocks of sand, scarcity of water and overall depletion of natural resources and biodiversity are frequent. There is no doubt that parallel to the move to a circular economy and doing more with less resources, China like all countries is making strategic plans about how to ensure supply of raw materials and resources also in the future.
China is not interested in import and supply of raw
materials only, but also of human capital. This is evident in their large-scale
business deals. They are not only for the acquisition of infrastructure or
machinery. They also aim to ensure that Chinese specialists, engineers,
scientists, and/or IT experts, learn to service, sustain and up-keep them. In
this manner, Chinese experts acquire knowledge and skills, which can be further
adopted and applied.
It is also evident that with increased globalisation and
shortened distances, few international projects implemented on a massive scale
are purely technical. They also carry political implications. Transportation
and movement of goods, services and capital will always warrant political and
security analysis, and from the perspective of the originating and recipient
countries and of neighboring countries.
To some extent, the rapid expansion and development of China
has not registered in its full significance, perhaps due to the fact that China
is not considered paternalistic in its policies. Yet China is not afraid to
take bold steps in the international arena, when it serves their interests. The
decision to move ahead with the launching of a new international development
bank two years ago, despite opposition from Washington, serves as an example of
this. The number of countries that joined the Asian Infrastructure Bank (AIIB)
reflected China’s growing economic influence not just in the region but in
Europe as well.
Europe need not
despair, but it does need to strategically consider how it will compete with
the pace and level of China’s development. The key is to be fast and to
consider where it has an added advantage.
Certain choices with regards to economic investments have to
be made in order to stay ahead of the game. Will Europe hold on to outdated
subsidies for coal-based energy production? Or will they remain relevant and
ahead of the game in the clean energy transition? Whether Europe can compete in
the circular economy arena with China, given the investments China is already
making towards this transition remains to be seen. The level and focus of
European investments into research and innovation, including through the EU’s
Horizon 2020, will influence this. How Europe supports entrepreneurship,
including among women where it has been lagging far behind considering both
China and the United States, and among youth, will also be of significance.
Where Europe has significant potential is in exporting
concepts and solutions, rather than raw materials. A good example is in the
area of e-Health and wellbeing. If European countries can, applying new
e-Health technology for prevention, treatment and monitoring of individuals
based on concepts and models of wellbeing, provide solutions to challenges that
societies in the future will face, this will make Europe relevant. We will have
something to offer that is valuable to governments at all levels, and in
individual demand. We just have to be clever about how we foster, market and
sell it.