When it came to China, the story was told for a long time about a tightly organized country that planned its rise with great foresight and like a military commander. If we look at China today, we see a different country. One with cities with a million inhabitants under lockdown, a collapsing real estate sector, and an increasingly frustrated population.
China’s economy hasn’t been in such bad shape for decades: Western expats just want to get out – and more and more young, well-educated Chinese are thinking about how they can escape the lockdown madness. The major report by our China correspondents Sabine Gusbeth and Dana Heide is about this drastic change in mood.
As soon as the research for our cover story was completed, there was another lockdown alarm in Beijing. Rumors spread about impending curfews in the capital. Immediately queues formed in front of the supermarkets.
Colleague Gusbeth also cycled away, to stock up on supplies. While she secured pasta, canned tomatoes and frozen peas, her Chinese neighbors mainly bought fresh vegetables, meat and eggs. In the evening, the authorities denied the rumors. However, there was a very similar denial the day before the lockdown in Shanghai at the end of March. Nobody there knows to this day when the lockdown will end.
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Handelsblatt correspondents Dana Heide and Sabine Gusbeth.
Instead of informing the population, the regime in Beijing is reacting extremely thin-skinned to any form of criticism of the zero Covid policy. There is only speculation as to why the government is sticking so staunchly to the strategy:
- The vaccination rate is actually much lower than officially stated – and therefore it would take a very long time to immunize the population sufficiently.
- Another explanation is that the leadership around Xi Jinping is in fact not concerned with protecting the population at all, but with what the Communist Party sees as being overly liberal and western metropolis Make an example of Shanghai.
- Still others believe that Xi is artificially prolonging the crisis in order to provide a basis for more control over society to get.
Whatever the reason, two things are becoming clear: First, China’s governance no longer focus their actions on the increasing prosperity of the people. Second, it is becoming increasingly clear that the Chinese model for success has been overestimated in some crucial points.
What else has kept us busy this week?
1. It has been a turbulent week for the Financial Markets team. Not only share prices collapsed worldwide, bonds, gold and cryptocurrencies also lost massively in value. Such a broad sell-off across all asset classes is unusual – and a cause for concern for some investors. Tech values were hit particularly hard. The crash on the crypto markets caused additional explosiveness. Bitcoin, the oldest and most important cryptocurrency, crashed from $36,000 to as low as $26,000. In November, the price was still almost $69,000. What we are experiencing on the financial markets is a painful transformation, writes my colleague Frank Wiebe.
2. The experienced Volker Wissing has had better weeks. As Federal Digital Minister at the G7 meeting on Tuesday, he declared that we should all take photos of less food and send it through the internet to save energy. The proposal for the “Veggie Day” category caused a shitstorm digitally – and also analogously among the Liberals. Then the FDP politician wanted to make things right again and on Thursday suggested dropping the mask, if on the plane, then on the bus and train as well. But Chancellor Olaf Scholz accepted the idea through his government spokesman. The proposal was liberal – but obviously not coordinated with the coalition partners.
3. But Wissing had already shot down the bird for every liberal at the beginning of the week. The Handelsblatt had reported on e-car considerations from its ministry: Instead of the current 6,000 euros, the state should in future – including a scrapping premium – subsidize up to 10,800 euros. There was great rejoicing among the bargain hunters, but not among the market liberals. After all, party leader Christian Lindner has rejected a purchase premium for years as the devil. And even as Minister of Finance, he is likely to have fallen off his chair: the fun would cost up to 73 billion by 2027.
The high inflation in Germany has many losers – and one winner: the state. The federal government can expect additional tax revenue of around 220 billion euros by 2026. Finance Minister Christian Lindner announced this on Thursday. Handelsblatt readers already knew it: Our capital office had already learned about the magnitude of the increasing income on Monday.
4. It is also called the “small federal election”: North Rhine-Westphalia, the most populous federal state, will vote on Sunday a new prime minister. The policy of the black-yellow coalition of Hendrik Wüst is up for voting. The big Handelsblatt analysis “NRW before the election in the economic check” shows how the state is really doing economically.
(Photo: Jo Holz / VISUM)
5. The “yes” of the Finns to their country’s NATO accession is a historic turning point – with possibly enormous consequences. “We expect three types of threats or intimidation from Russia: cyber threats, threats in the form of disinformation and hybrid threats, i.e. a mixture of both,” ex-Prime Minister Alexander Stubb said in an interview with the Handelsblatt.
6. He’s a billionaire, 30 years old, stirring up Wall Street – and wants to donate his entire fortune. We’re talking about Sam Bankman-Fried, the founder of crypto exchange FTX, which is already more valuable than Deutsche Bank. When Astrid Dörner and Felix Holtermann met the 30-year-old in the Bahamas, he appeared in tennis socks, shorts and a T-shirt with the company logo. And that wasn’t even something special: In this outfit he also meets people like Bill Clinton and Tony Blair.
7. One of the many overlooked issues of the energy transition is, of all things, the rapidly growing number of private charging points for electric cars. Many property owners have them installed, but do not register them – with potentially far-reaching consequences: the network operator EWE is already warning of local blackouts.
8th. It sounds so easy. The solar systems are already built, they only have to be connected to the grid. But that’s exactly the problem: More than 1000 installed systems lack certification – and thus permission to put them into operation. The plans have been in the Uckermark for 17 years now. Catiana Krapp and Anna Gauto describe how Germany’s bureaucracy madness is slowing down the energy transition – despite all plans that want to change that.
9. What actually makes you happy? Even the question is wrong, says the sociologist Martin Schröder in an interview with the Handelsblatt. The pugnacious scientist also has a few other observations ready: the job is the most important satisfaction factor alongside health, but money is not. And from his point of view it is not always advisable to “want to be better than others”. Steep theses, which he can, however, often prove with data.
I wish you a relaxing weekend
It greets you cordially
Yours Sebastian Matthes
Editor-in-Chief of the Handelsblatt
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