China

1. Germany avoids China ‘reset’
2. Wind giants look abroad
3. AstraZeneca’s dual bet
4. Chinese EVs target US
5. US allies court Beijing
6. Tariffs give China leverage
7. China-Japan export curbs
8. IMF makes yuan call
9. The robot battle to come
10. A fancy foods powerhouse

Expert insight from a former head of the EU Chamber of Commerce in China, and a box office hit backed by China’s intelligence agency.

I’m Andy Browne, and I’ll be anchoring Semafor China, our weekly executive briefing on one of the central stories of the new global economy.

I’ve covered China and the surrounding region for decades. Over that time, I’ve learned two lessons. First, getting the story right requires a sense of proportion; it’s a mistake to either glamorize or demonize the country. Second, be skeptical about prevailing narratives.

When I first arrived in Beijing, shortly after the 1989 Tiananmen Square massacre, most experts believed that China had set back its economy by a generation: The country would surely become a pariah, the thinking went. In fact, it was on the cusp of one of the greatest booms in history.

Today, a “China-is-winning” narrative has taken hold. Sure, China has towering strengths, but it is also saddled with deep economic malaise. It is this duality that has fascinated me for my entire career: China cannot be captured by a pithy anecdote, or a sweeping statement. It has defied predictions for generations because it is so vast, so filled with contradictions and complexity.

Ultimately, I’m pretty sure that China can ride out a few bad quarters — or even a few bad years. But global decision makers can’t wait that long, and they certainly can’t progress without both collaborating and competing in its vast markets. They need timely news, analysis, and insight to help shape ties with China’s consumers, officials, and leaders.

The goal of this briefing is to guide that journey: Expect scoops from across Semafor’s global newsroom, alongside a comprehensive rundown of the best China-focused journalism and analysis from across the internet. In particular, we’ll have a weekly interview with an Asian CEO by my new colleague Clay Chandler — most recently Fortune’s Asia Executive Editor — who is laying the groundwork for Semafor’s coverage across the region.

We’re excited to get going — and to get your help in guiding this new product: You can always get in touch by replying to this email, I’d love to hear what you think.

No Berlin-Beijing reset expected

German Chancellor Friedrich Merz arrived in Beijing with 30 business leaders in tow, intending to “update” — not reset — relations with Beijing, unlike Canada’s and Britain’s leaders before him. Berlin downplayed the delegation’s significance, and no business deals are to be announced: “Don’t expect a ‘Starm offensive’ from Merz,” one leading analyst noted, referring to the UK prime minister’s trip. Rather, Merz will press Xi Jinping on the countries’ ballooning trade imbalances: German exports to China, particularly car sales, have plummeted, while Europe is buying more Chinese goods, driven partly by a depreciated yuan. China is “one of the great powers shaping the new era,” Merz wrote. “It would be a fallacy to believe that decoupling is the right path.”

China’s wind sector targets Europe

Geopolitical tensions won’t deter Chinese wind turbine manufacturers from expanding into Europe, a top executive at one of China’s biggest firms told Semafor. The remarks by Windey International CEO Yu Feng come with Beijing and Brussels appearing to calm a row over Chinese green exports to the EU, and with Germany’s leader visiting China this week, the latest of several European leaders to do so. Despite China’s global dominance in the wind sector, European capitals — wary of apparent security risks tied to using Chinese tech — have been reluctant to deploy the country’s wind turbines, prioritizing homegrown companies instead. But Yu was confident that Chinese wind turbines would arrive in Europe “sooner or later,” saying they were “irreplaceable” to the world.

AstraZeneca on competing with China

AstraZeneca wants to intensify competition with fast-growing Chinese pharmaceutical rivals — an ambition that is counterintuitively driving it to expand collaboration with them, the Anglo-Swedish firm’s CEO told Semafor. “If we don’t compete with Chinese companies,” Pascal Soriot said in an interview with CEO Editor Andrew Edgecliffe-Johnson, “we’re going to lose.” AstraZeneca recently announced $15 billion of investments in China, where companies are now producing some of the world’s most advanced cancer drugs and cell therapies. Potentially, that undermines Europe’s own industry, but Soriot was unapologetic. “If we don’t do it, someone else is going to do it, especially Chinese companies,” he said. Besides, Soriot continued, “they don’t need us anymore.”

View: Chinese EVs as US ‘salvation’

US restrictions on Chinese EVs are misguided and, in fact, the vehicles’ entry into the American market could offer a salvation for Detroit’s automakers, Semafor’s China columnist Andy Browne argued in his latest piece. Wary of the apparent security risks these internet-connected devices pose, policymakers in Washington have maintained sky-high tariffs on China’s EV makers. Solar panels, drones, and surveillance cameras have all met a similar fate. EVs, however, are different, Browne noted, because they drive the development of other key technologies such as batteries. Washington’s diagnosis of the problem they pose, and how to address it, illustrates how deeply officials risk misunderstanding China.

How US allies hedge under Trump

Trips by Western officials constitute about half of all announced diplomatic visits to China during Donald Trump’s second term so far, according to a Semafor analysis of Chinese government data. That compares to only a quarter of visits during Trump’s first term and Joe Biden’s presidency. The findings quantify a global shift — emphasized most recently by German Chancellor Friedrich Merz’s visit to China this week — in which Beijing is courting Washington’s traditional partners, nations now hedging between the superpowers. For Beijing, the trips “send a powerful message… about China’s great-power status and America’s diminished reliability,” The Economist wrote. Despite a host of underlying disputes, the bonhomie is a “material improvement” after years of “decoupling” talk.

Tariff ruling a win for China

The US Supreme Court’s ruling canceling most of President Donald Trump’s tariffs leaves China in a stronger position heading into April talks between the countries’ leaders, analysts said. Duties on Chinese imports fell 5% following the decision, which prompted Trump to impose a 15% flat tariff on all goods. While Beijing could use the ruling to renegotiate its trade truce with the US, it’s most likely that neither side will rock the boat ahead of Trump’s upcoming visit to China, China Briefing wrote. Several experts argued the tariff ruling gave Beijing considerable leverage in future talks, but the real fight will be over export controls: US chips versus Chinese minerals.

China tightens Japan export curbs

China hit dozens of Japanese companies with export restrictions as tensions between the two countries escalated. Beijing reacted angrily in November when new Japanese Prime Minister Sanae Takaichi warned against Chinese aggression towards Taiwan, and China’s position has hardened since her landslide election victory this month. It curbed exports to 20 companies of rare-earth magnets and other minerals which it said have military applications, to slow what it called Japan’s “remilitarization.” The companies do have defense divisions — carmaker Subaru, for instance, makes helicopters and military trucks — but “China’s measures could result in a blow to their civilian businesses,” the Financial Times reported, and force Tokyo to expand its supply chains to prevent further disruption.

China risks a currency backlash

By now, it’s almost universally acknowledged that China’s yuan is undervalued, driving the country’s trade surpluses and preventing a rebalancing toward domestic consumption. By how much? A recent IMF report said the currency was 16% weaker than it should be; Goldman Sachs estimated 25%; Weijian Shan, the chair of private equity firm PAG, argued 50%, pointing to The Economist’s Big Mac Index. The yuan’s value is why residents of Hong Kong, whose currency is tied to the dollar, now pour into the mainland to eat and shop. Chinese leaders are wary of letting it strengthen — Japan’s “lost decades” followed a sharp currency appreciation — but their inaction risks a global backlash.

The gulf between robot hype and reality

An ensemble of backflipping humanoid robots at China’s Lunar New Year gala generated a storm of publicity at home — and a slew of alarmist headlines abroad. While Chinese companies like Unitree have generated hype in a space once dominated by US startups, China is far from winning the robotics race, experts cautioned, a competition that remains in its infancy. While dancing robots are impressive to watch, such demonstrations don’t translate into actually useful tasks, Semafor’s Tech Editor noted. The decisive battle will be over software, Asia-focused investor Denis Kalinin told Semafor. On that front, US and European labs are ahead, but China is closing in: “Once the PR dust settles, the only metric that will matter is… sustained, scaled deployments.”

China is a caviar powerhouse

China is rapidly becoming a fancy foods powerhouse, giving traditional Western producers heartburn. The country is the world’s biggest exporter of sturgeon caviar, accounting for 44% of global sales in 2024, and is transforming smaller cities and rural counties into production hubs of olive oil, wines, and matcha. The expansion reflects Beijing’s aims to shift “China’s reputation from the world’s factory to a purveyor of pricey specialty goods,” Bloomberg reported last year. China’s caviar boom is also a case study in how it scales innovation, The Economist noted: One firm produces caviar year-round in an artificial lake twice the size of Malta. Countries like France and Japan, as a result, are fighting to protect their luxury food markets from Chinese imports.

Jörg Wuttke is a Partner at DGA Albright Stonebridge Group. Previously, he was BASF’s Chief Representative in China for almost three decades, and head of the EU Chamber of Commerce in China.

Every week, we dig through China-focused newsletters and podcasts, and bring you key takeaways from the Sinologist community.

• Amid the US-China “decoupling” narrative, commercial and technological realities act as “strong forces trying to pull the two sides together” even as the geopolitical forces try to pull them apart, researcher and writer Kyle Chan said. Expect an “ongoing tug-of-war” between these enterprise and political forces. — Sinica Podcast
• China is trailing the US in AI in part because American firms benefit from a more robust ecosystem for AI to scale across the economy through an open web architecture, a Peking University professor argued. Chinese startups face a choice: “Bow down to platform dominance or flee overseas.” — Sinification
• The narrative of a widespread “996” work culture in China — 9 a.m. to 9 p.m., 6 days a week — is a myth that “reinforces perennial fears about China out-competing the West.” The reality is much more varied. Many public workers operate on a “323” schedule: Three hours of work, a two-hour lunch break, and three more hours of work. — Foreign Policy China Brief

• HSBC releases earnings on Wednesday, and the Hong Kong Stock Exchange follows on Thursday.
• The media center for China’s “Two Sessions” meetings opens on Friday, ahead of the key policy-setting gatherings next week.
• China is expected on Sunday to formally lower tariffs on Canadian canola seed from 85% to 15%, a deal that follows Prime Minister Mark Carney’s visit last month.

One of the biggest Chinese box office hits during the Lunar New Year holiday was a spy thriller backed by the country’s intelligence agency. Scare Out follows counter-espionage agents tracking down a researcher who leaked information about a stealth fighter jet. China’s Ministry of State Security said the script was based on real cases and is a “timely warning rooted in reality,” tying the film to Beijing’s broader security education campaign. The ministry, which has never directly supervised a movie until now, often “sensationalizes” national security threats to “instill a suspicion of foreigners,” the Jamestown Foundation wrote last year. Scare Out follows a trend of nationalist flicks that cruise to box office success.