EU-China EV row + China’s stock market rally wilts + Labeling of AI-generated content

In today’s issue of our MERICS China Essentials, we look at the following topics:?

The European Commission's aim to "de-risk" economic relations with China scored a goal last week when Brussels' proposal to impose additional tariffs on electric vehicles made in China won the support of ten EU member states – even though Germany, the block’s largest economy, voted against the measure. “Beijing's response to the tariff vote so far has arguably been on the low side, with some measures even described as temporary, suggesting that China still has an interest in negotiating an alternative solution with the EU “, says Grzegorz (Greg) Stec , Head of the Brussels office of MERICS. “Brussels needs to make use of its strengthened negotiating position, as the EU remains the last large open market accessible to China.”?

China’s stock market eased its recent gains Tuesday after the economic planning agency NDRC signaled only vague prospects for more stimulus to bolster the struggling economy at a press conference. MERICS Lead Analyst Jacob Gunter says: “The political economy choices in Beijing have been clear for years now – the government will do enough to stabilize the economy and prevent a total rout, but it’s willing to suffer the pain of a necessary correction. Support must be reserved for making China into the industrial and tech superpower that the leadership aspires to. The NDRC press conference transcript reflects this longstanding goal.”?

The Cyberspace Administration of China (CAC) has proposed new measures for regulating content generated by artificial intelligence. According to MERICS Analyst Wendy Chang , “China’s nimble approach in creating small pieces of regulation instead of overarching ones has allowed it to move fast and better keep up with rapid developments in the AI space. The latest rules on labeling generated content may prove a useful experiment for other countries to observe and learn from.”?

Stricter implementation and enforcement of rules restricting overseas travel appears to be affecting an increasing number of lower-level public sector employees, such as teachers and even retirees. MERICS Analyst 安复礼 says: "Xi places great emphasis on maintaining order by monitoring and indoctrinating his citizens – so controlling where they can go seems to be a logical next step. Freedom to travel looks set to become another area in which China adopts a fundamentally different approach to the West.”

Continue reading this issue of MERICS China Essentials on our website.