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Ambassador Zhang Ming on Supply Chain: Decoupling Will Only Create Counter-effects
2021-11-15 17:48

On 10 November 2021, Ambassador Zhang Ming, Head of the Chinese Mission to the EU, sat down with Sam Fleming, Brussels Bureau Chief of the Financial Times (FT), and Andy Bounds, FT's EU correspondent, for an exclusive interview. Answering a question on the EU’s effort to seek technological strategic autonomy especially semiconductor manufacturing capacity, Ambassador Zhang Ming made the following remarks.

Strategic autonomy is not a new concept for the European Union or even the European Community. It was raised a long time ago. But in the past two years, it became once again a buzzword in European politics. Meanwhile, I find its implications still controversial. Generally speaking, China welcomes and supports the EU’s strive for strategic autonomy. The EU is no dependency to any country. As a global power and an independent pole in today’s world, it is the responsibility of the EU to make its own judgment based on its interests and the basic right and wrong.

Such position of China remains unchanged in the past several decades. It’s hard to find any other major country that maintains such firm support towards the EU and whose EU policy remains so consistent. When it comes to relations with China, we also hope the EU can adopt and follow an independent and objective perception towards China.

I also noticed that some people claim that the EU’s attempt to achieve strategic autonomy aims at lowering its dependence on China. I think such is a rather narrow-minded interpretation of the EU’s claim. It even has a certain sense of protectionism. I don’t think it's an accurate depiction of the picture.

Last year, since the outbreak of the pandemic, the global supply chain has seen major blockades. We’ve experienced shortages in medical supplies and shortages in chips in particular, which have dealt a huge blow to the manufacturing industry. Beyond that, shortages also occurred in the supplies of containers, resources and bulk commodities. Such developments have caused European countries to contemplate localizing their productions. I think such an attempt is a kind of stress response, which is quite understandable. We also heard similar discussions in other parts of the world.

But any serious discussion needs to go back to the track of rationality. Rationality tells us that concerns should not become the excuse for decoupling or protectionism. Global supply and industrial chains are important channels connecting the division of labor and cooperation around the world. Their operations are decided by the rules of the economy and by choices made by capital and investment in economic globalization. Any artificial attempt to transfer production or to seek decoupling will only create counter-effects.

Currently, we are faced with numerous problems in the global supply chain. While the pandemic is part of the story, the most fundamental reason goes back to the Trump era. At that time, the US administration issued a series of irresponsible and extreme measures, such as cutting supplies, decoupling from other economies, launching trade wars and tariff wars against others. The fallout continues even until today.

In a globalized world, the interests of all members of the international community are highly interdependent and closely intertwined. Experience in the past few decades of reform and opening-up tells us that opening-up is the key to straightening out all sectors in the supply chain as well as the path to progress and prosperity. Building up walls will not only cost us external resources and markets but will also curb innovation and competition at home.

To sum up my points, I think all members of the international community, with China and the EU included, need to further cooperate, uphold multilateralism and get rid of all measures that are protectionist and unilateral in nature.

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