InFocus China 2018/1. by Antall József Tudásközpont

IN FOCUS

2018. 2nd Issue Free of Charge

China at the Dawn of the New Era

Interviews

Society

Culture

Economy

China at the Dawn of the New Era

All rights reserved. Articles to be found in this publication are the intellectual property of the Antall Jรณzsef Knowledge Centre. No part of this publication may be reproduced, distributed, or transmitted in any form or by any means, including photocopying, recording, or other electronic or mechanical methods, without the prior written permission of the publisher.

TABLE OF CONTENTS

The 19 th Congress of the CCP— Announcing the “New Era” Welcoming Words Guest Authors

The Internationalisation of the

Renminbi and the Renminbi

Programme of the Central Bank of Hungary

Prospects of the Renminbi to Become Introduction Country Profile

an International Currency 8

or Reality?

In Focus

The Decarbonisation of China—Myth 68

The Chinese Foreign Policy of

Culture & Society

Globalisation 2.0

Colourful China

Interview with H.E. Sándor Kusai,

Vice versa: Chinese in Hungary—

Former Ambassador of Hungary to the

Hungarians in China

People’s Republic of China and Professor

The Chinese Soft Power

Chinese Business Etiquette

at Pázmány Péter Catholic University

Chinese Higher Education: Is Beijing University the Harvard of the Future?

Chinese Holidays—Traditions, Interview

Culture, and Development

Chinese–Hungarian Relations in Light of

Chinese Film Industry—Past, Present,

the New Chinese Initiatives

and Future

102

Interview with H.E. Duan Jielong,

Top 5 Innovative Companies

106

Top 5 Sportsperson

108

Top 5 Natural Spectacles

110

Top 5 Feast Dishes

112

Ambassador of the People’s Republic of China to Hungary

Broad Strokes

The Antall József Knowledge Centre

The Middle Kingdom—A Civilisation Spanning Through Centuries

Main Lines of Chinese Foreign Policy in the Xi era

Past Events

114

New Releases

116

China’s Growing Role in (World) Trade in the 21st Century

Authors

121

References of Pictures and Used Data

122

China’s 40 Years of Reform and Opening-up

The Belt and Road Initiative—The Dawn of a New International Order?

The Stabilizing Role of the Belt and

Next Issue In Focus: Environmental Migration

Road Initiative in Eurasia

The Thriving China–CEEC Cooperation

124

WELCOMING WORDS

Dear Readers,

Editor’s Introduction

One of the priorities of the Antall József Knowledge

The current issue of In Focus magazine centers around

Centre (AJKC) is to make China better understood

the role of the People’s Republic of China in the changing

with our publications and conferences. The AJKC has

fundamental changes caused by the rapid development

in Hungary—an aim we have been trying to achieve already published the work of Chinese President Xi

Jinping, The Governance of China, which provides

a unique insight into Chinese politics and way of

thinking. We have also been cooperating with Chinese and Hungarian partners for years in order to provide meaningful content about the country.

Today, when Beijing is not only a definitive economic

power but also a major political player on the global stage, we need to value this country in an appropriate

framework. In the past few years, many articles were published all over the world, asking “what the Chinese want.” What does the “16+1” Cooperation mean, and

global order. The publication investigates China’s and modernisation processes in the recent decades

as well as the country’s new role in world economy and

global governance, while also shedding light on Chinese politics, economics, finance, society, and culture. The

relevance of the current issue lies in the declaration of the “new era” by President-Party Secretary Xi Jinping, which per se does not mean an extreme change in neither the domestic nor the foreign policy, yet it is of importance,

since it made it clear that China now openly claims its

want to become one of the main global actors in the near future.

In Focus: China explores—among other questions—

what role does it play to reinvigorate the ancient Silk

in what direction will the Chinese foreign and economic

China step onto the world stage and become a global

National Congress of the Chinese Communist Party.

Our present issue tries to contribute to those

Initiative proposed a couple of years ago along with the

Road, the arteria of world economy for centuries? Will political player or remain a regional power?

answers. Our colleagues along with other renowned

foreign and Hungarian partners shed light on different aspects of culture, economy, politics, and bilateral

relations, and attempt to take the reader on a guided tour around the country. China, the greatest power in

the times of Marco Polo, is now playing a growing role

in world politics, and for that reason, we encourage our readers to follow the steps of the great Venetian and rediscover this world with us on the following pages.

policy evolve in the “new era” announced at the 19th

Moreover, several articles cover the Belt and Road

cooperation mechanism between sixteen Central and Eastern European countries and China, which Hungary wishes to be actively involved in. The magazine also

examines the possibility of China’s decarbonisation and the process of the renminbi’s internationalisation. Besides

the topics listed above, the magazine aims to present—a piece of both ancient and modern China—Chinese

holidays, business etiquette, and the film industry as well.

Tamás Péter Baranyi—Editor-in-Chief

Viktória Anna Papp—Editor

Research leader

International relations manager

Antall József Knowledge Centre

Antall József Knowledge Centre WELCOMING WORDS

GUEST AUTHORS

Dr Chen Xinguang Dr Chen Xinguang Research fellow of the Shanghai Academy and Department of International Relations at Fudan University, Vice-Chairman of the Shanghai Statistics Society, professor of the Economics Department at Shanghai University, and guest researcher at the Centre for China and Globalisation (CCG). Author of a series books, studies, and articles on international relations and economics. CHINA’S 40 YEARS OF REFORM AND OPENING-UP (page 38)

Dániel Palotai Executive Director and chief economist of the Central Bank of Hungary (MNB). He previously worked as an analyst at the European Central Bank and was later head of the Economics Ministry’s Macroeconomics Department. In 2013, he led the Hungarian delegation during the bilateral swap line negotiations with the People’s Bank of China. Since 2014, he has overseen the MNB’s Renminbi Programme. His outstanding professional work was recognised in 2015 with the Sándor Popovics Award. Since 2016, he has been the president of the competitiveness section of

the Hungarian Economics Society (MKT), and since 2017, he has been the VicePresident of the MKT. Since 2017, he has been the lead coordinator of negotiations with the Bank of China. THE INTERNATIONALISATION OF THE RENMINBI AND THE RENMINBI PROGRAMME OF THE CENTRAL BANK OF HUNGARY (page 61)

Viktor Eszterhai Senior analyst of the Pallas Athéné Innovation and Geopolitical Foundation. He earned an MA in Geography and History at the Eötvös Loránd University in 2010 and a BA in Psychology. He is currently a doctoral candidate at the ELTE Modern and Contemporary World History doctoral school, expected to have his degree in 2018. As a guest researcher with a state scholarship, he spent 11 months from September 2014 to July 2015 at the Tsinghua University in Beijing. In 2017, he was guest researcher at the Fudan Development Institute. His research fields are the cultural specifics of Chinese foreign policy, non-Western schools of international relations, Chinese–Central European relations. THE BELT AND ROAD INITIATIVE—THE DAWN OF A NEW INTERNATIONAL ORDER? (page 42)

Gao Haihong Director and senior research fellow of the Research Center for International Finance at the Institute of World Economics and Politics of the Chinese Academy of Social Sciences (CASS). Lead researcher of the China’s role in the international financial system CASS research project, guest lecturer at the China Foreign Affairs University and Permanent Director of the council of the China Society of World Economics. She is the author of the following publications: The Internationalisation of the Renminbi, G20 and Global Economic Governance, The International Financial System: Reform and Reconstruction. PROSPECTS OF THE RENMINBI TO BECOME AN INTERNATIONAL CURRENCY (page 65)

dr jur. Tamás Matura Founder of the Central and Eastern European Centre for Asian Studies (CEECAS). As a research fellow, he worked on China-related issues at the Hungarian Institute for Foreign Affairs and Trade for over a decade.

As an adviser on China to the Minister of National Economy, he was an editor of Hungary’s China and BRICS strategy. Currently, he is an assistant professor at the Corvinus University and lecturer at the Pázmány Péter Catholic University and the ESSCA School of Management. He is a member of the European Think Tank Network on China. He holds a doctoral MA in law, and an MA in international relations. MAIN LINES OF CHINESE FOREIGN POLICY IN THE XI ERA (page 30)

Dr Ágnes Szunomár Ágnes Szunomár is the head of the Research Group on Development Economics at the Institute of World Economics, Centre for Economic and Regional Studies of the Hungarian Academy of Sciences. Her research focuses on China’s foreign economic relations, including the relationship between China and Central and Eastern Europe. Currently, she is the leader of a research project focusing on emerging market multinational companies’ activities in Central and Eastern Europe. She also conducted research on foreign trade and foreign direct investment issues and related policies in the Central-East European countries, with special attention to developments

in Hungary. She holds a PhD in Economics from the Corvinus University of Budapest. CHINA’S GROWING ROLE IN (WORLD) TRADE IN THE 21ST CENTURY (page 34)

Bernadett Hári Expert in Chinese international relations at the Antall József Knowledge Centre between 2016 and 2017. She is currently active in business development in Shanghai. She holds a BA degree in Public Administration from the Corvinus University of Budapest and studied Chinese language and culture in Jinan between 2013 and 2015. CHINESE BUSINESS ETIQUETTE (page 87)

Dr Chen Xin Dr Chen Xin is the Director of the Economics Department of the European Studies Institute of the China Academy of Social Sciences (CASS), Managing Director and VicePresident of the Budapestbased China–CEE Institute. His main areas of research are the economic and trade relations between China, the European Union and the CEE region. He is also a doctoral advisor of the European Studies Institute and teaches college-level studies in European Integration and The European Economy: Companies and Investments at the CASS. The articles published in this issue do not represent the point of view of the Antall József Knowledge Centre, they are the authors’ individual views based on academic freedom. THE THRIVING CHINA– CEEC COOPERATION (page 51)

Zhang Zhao Lecturer at the School of International Journalism and Communication of the Beijing Foreign Studies University. His main research area is the traditional Chinese cultural heritage and its reflection in everyday discourse.

Dr Li Lei Research fellow at the Chinese History Research Centre of the Beijing Foreign Language University. Her main area of research is Chinese literature and culture.

CHINESE HOLIDAYS— TRADITIONS, CULTURE, AND DEVELOPMENT (page 96)

The articles published in this issue do not represent the point of view of the Antall József Knowledge Centre, they are the authors’ individual views based on academic freedom.

Special Administrative Region

Municipality

Autonomous regions

Provinces

Tibe t

Qinghai

Gan

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Sich

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Guizhou

Ningxia Hui

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n una

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Tianjin

Beijing Hebei

Henan

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INTRODUCTION

ng ua iZ h

Jia

Jilin

Heilongjiang

Official name:

people’s republic

Form of state governance:

1 October 1949

Proclamation:

中华人民共和国)

People’s Republic of China (Zhonghua Renmin Gongheguo,

Premier:

Li Keqiang

Head of state:

Xi Jinping (President, Party General Secretary)

National anthem:

March of the Volunteers

22+1 provinces; 5 autonomous regions; 4 municipalities; 2 special administrative regions

Administrative divisions:

Official language:

Standard Chinese

Capital:

Beijing

Shanghai (24.3 million)

City with the biggest population:

Population: 1,409,517,397

Area:

9,640,821 km²

GDP:

USD 12.40 trillion (nom), USD 23.57 trillion (PPP)

COUNTRY PROFILE

Administrative divisions of the People’s Republic of China

IN FOCUS

THE CHINESE FOREIGN POLICY OF GLOBALISATION 2.0 Interview with H.E. Sándor Kusai, former Ambassador of Hungary to the People’s Republic of China and professor at Pázmány Peter Catholic University

How do you perceive China’s current role in the international order, especially now that the United States’ protectionist and isolationist policies have provided Beijing with an opening? On the one hand, I think the Trump administration continues to influence the world’s processes on its own terms, but through different means—although there is no visible unity in the US behind this effort. This is a quite complex and difficult situation, and thus—naturally—China’s response is multi-layered too. On the other hand, the strategic concept drafted by Xi Jinping for the next 35 years (Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era) is a complex, logical, and coherent plan that concerns China’s domestic development and international role. Of course, it does not mean that it is going to be successful—the fact that something seems logical does not guarantee 10

IN FOCUS

success. While strengthening itself in the next three decades, China also wants to gradually become a responsible actor in international relations and take part in the transformation of the international order and global (economic, political, etc.) governance. Thus, as a responsible great power, China does not want to overturn the world order; it wants to reform and revise it and also participate in this process—this is what Xi Jinping said at the last party congress. One of the elements of this effort is the so-called “Globalisation 2.0,” which Xi has expounded on at the World Economic Forum in Davos. China is interested in the continuation of globalisation, since it has been its beneficiary. In its current form, however, the “path of globalisation” cannot be followed because it creates too many losers—even in those countries which are winners of this process—since it distributes the advantages of globalisation unevenly. The point of this concept is to make China one of the most influential leading countries in two stages (until 2035, then by 2050), which can, on a systemic level, influence the development of international affairs and bring about changes in the international order and global governance. This does not mean that China would have claimed itself to be a revisionist superpower in a classical sense. It announced a cooperative foreign policy and foreign economic policy and in cooperation with the other key actors (e.g. USA, Europe, Japan), it wishes to transform the world. It wants to press for a situation where China has an equal say—yet not through military means. In connection with the United States, it means that China wants to become equal with the U.S. In the long run, whether there will be an American answer to this, mainly depends on its domestic affairs.

As a responsible great power and a representative of “Globalisation 2.0” China interprets the idea of “community with shared future for mankind”—which was announced by Xi Jinping at the 19th congress of the CCP—as a framework or guideline for foreign relations. What does this “community” really refer to? It is quite difficult to define. As an analyst, I tend to think that in this case the Chinese concept should be interpreted along the structure of Chinese thinking, not in our own. The entire Chinese foreign policy is characterised by two very distinctive elements. The first is what was stated by Xi Jinping very clearly: China will not make any concessions regarding its national interests in the future. The second element is the formation of a cooperative world order, the harmonisation of different economic, security, and other interests—which makes it necessary for partners to be cooperative as well, while taking note of the fact that, according to the Chinese understanding, the country will not make concessions regarding its fundamental interests. The “shared future for mankind” refers to an international economic cooperation which has—domestically and internationally as well— fewer losers than currently. China would like to see the scale of social differentiation and polarisation reduced—this is included in Xi Jinping’s concept too. Furthermore, environmental protection and joint action against climate change, the development of regions within and outside of China that are lagging behind as well as setting up the necessary international framework for that purpose, are all included in the idea of this harmonious international world. This is a kind of egalitarian concept which wishes to alleviate the current international order’s disharmonies, dysfunctions, and inequalities. China does not want to simply be a rule-abiding power of the world (that is, it does not want to take part in the preservation or reinforcement of the order created by the leading powers after 1945); instead, it wants to become a rulesetting power. This, however, does not mean that China wants to write the rules all by itself— on the contrary, it wants to do so together with the other actors.

WHILE STRENGTHENING ITSELF IN THE NEXT THREE DECADES,

CHINA ALSO WANTS TO

GRADUALLY BECOME A RESPONSIBLE ACTOR IN INTERNATIONAL RELATIONS

Given China’s economic and political power, it can make a larger contribution to the formation of these new rules. In your opinion, could this be an alternative to the international order led by the West, and if yes, to what extent? I think China has already participated in the formation of alternative structures and has been one of the leading powers of this effort globally. China does not want these structures to function as an alternative to the governance of the current world economy but to use them as a compelling tool to allow the country to be regarded in accordance with its true weight. One of the typical examples of this was the IMF’s decision in 2010 about the reapportioning of voting shares and the inclusion of the Chinese yuan into the SDR basket. This agreement was not ratified by the U.S. Senate until 2015, and which was why it could not take effect. Quotas within the IMF are revised in every five years, so the next quota revision started in 2015, while the results of the previous term had not come into force. Meanwhile, the BRICS Development Bank, the Chiang May Initiative, and the Asian Infrastructure Investment Bank were launched. Thereafter, when it was clear that a country with serious financial problems does not necessarily have to turn to the IMF, since it can also go to the BRICS Bank, the American Senate suddenly approved the 2010 reform. This example shows that China does not make these alternative IN FOCUS

structures to replace the existing ones. China’s aim is more about forcing their correction and letting the country participate in the formation of rules. The Chinese quota in the IMF and the share of yuan in the SDR basket is still not as much as the United States’ or the European Union’s, but it is much more than it was before. I expect similar processes in the future, and this is my interpretation of the role of alternative structures. How does the Belt and Road Initiative (previously One Belt One Road) fit into this process, given that this concept has changed a lot since 2012? In my opinion, the Belt and Road Initiative is an important tool of the Chinese leadership to realise its ideas concerning the transformation, leverage, and modification of the global economic governance. A part of the initiative’s role is to integrate, reorganise, and restructure the Afro– Eurasian landmass (used to be one geographical unit) that defines the future of the world. There are a lot of dysfunctions and problems between the economically developed Eastern (China, Japan, South Korea) and Western (Europe) ends of this enormous geopolitical field, e.g. the ongoing conflicts in the Middle East. The situation is similar in the Southern end of this continent complex, Africa, too. At the same time, between these ends—from Central and Eastern Europe to Central Asia—there is actually a “black hole” in terms of economic development, which does not even have a proper communication network running through it. China says that we should build these networks. There are two technologically and economically developed endpoints being in need of natural and human resources that are available in Africa as well as in Central Asia and in Central Europe. Let’s develop these regions into an integrated economic structure while utilizing their resources and providing them with an opportunity to catch up. The Belt and Road Initiative today is not what it was when they launched it in 2013; its name has also been changed several times over the years. By now, the BRI has roughly taken shape, which I tend to define as a loose, self-improving network structure. It is not by coincidence that the last word 12

IN FOCUS

of the name is a precise one with scientific value: it is not a concept, nor a strategy, but an initiative. The joining states may have access to Chinese resources, if their intentions fit into the concept of reorganizing the Eurasian–African geopoliticaleconomic region. I would like to add that sooner or later, this concept should naturally include subregional cooperation platforms such as the “16+1” Cooperation. Provided that these sixteen European countries can learn, practice, and think about how they can benefit from it individually as well as jointly and suggest projects accordingly, etc. Let me refer to one of the latest developments: Russia and China signed an agreement to synchronise the Eurasian Economic Union and the BRI. As long as it is realised in a manner that the parties do not compete but intently cooperate with each other, Eurasia’s economy can be jointly reorganised up to the Turkish and Iranian border. Are the Chinese policymakers aware of the fact that by reviving the Silk Road, in some sense, they shift the world’s trading routes back to Eurasia, which were once directed to the Atlantic region by the great geographical discoveries? Is it the deliberate aim of these policies? India had been an independent world until the British colonised it. The same was true of China, too. They did not care whether the Reformation was taking place in Europe or not. Global history and global economy have been existing, but they were a collage of different civilisational and geographical spheres. What linked them was colonialisation after the great geographical discoveries. As the epicentre of world economy and trade shifted towards the global power centre, Europe and later to the United States, those could become significant powers who had control over the World Ocean because the main trade routes and the exchange of goods were running there. Now, the Belt and Road Initiative is about the elimination of the need for bypassing the Eurasian–African landmass that is rich in natural and human resources. I do not know whether it is their intention or not, but if they economically reorganise this region and develop economic connections on land as well as on smaller waterways (e.g. Indian Ocean, Suez Canal), then the consequences

will definitely transform the global geopolitical equilibrium. The Belt and Road Initiative is one of the elements of the long-term Chinese plan for 2050—it is not an aim but a tool for implementation. According to the official Chinese standpoint, their final aim is a multipolar world order, that is jointly run by states—not alliances standing against each other—which would make it possible to solve issues without military or economic conflicts and to harmonise different interest. In modern politics, countries tend to state that by using their leverage, they can provide public goods such as security, peace, etc. in a global sense. The Chinese say that we, the ones who are able to do so, should provide these public goods together. Well, that sounds like progress! Of course, we cannot be sure of that they would not want to provide these public goods by themselves in the end. In Chinese political thinking, it is simply called hegemony and that is what China denies. China does not join alliances, nor does it create new ones, as its foreign policy efforts aim at building a new type of network of partnerships. I think, it is important to note that when talking about alliances, China always means it in a strictly scientific sense. That is, alliance is among states which have taken upon a legal obligation to help their allies without hesitation in case any of them gets attacked. In that sense, China does not have any allies today, instead, it maintains partnerships on different levels, providing it more freedom while expanding its radius of action and circle of partners. In current international relations, for example, the Chinese–Russian relations are as close to being a partnership as possible without actually becoming one. Having been trained in a Western European way of thinking, we often do not even understand the conceptual system that the Chinese use because they do not use the same structures of thinking as us. The Belt and Road Initiative serves not only foreign policy goals, but it also aims at reducing the domestic inequalities within China along with other goals. Can this be, in your opinion, a suitable tool for avoiding the middle income trap? The Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era is a unified, coherent

concept, which has all its components thought through and connected to one another. The element of this concept concerning economic development fits organically into the thoughts revolving around the future of the Chinese society and China’s position in the world. Of course, this involves dealing with China’s regional imbalances, which includes the development of China’s inner provinces. With this concept, the Chinese want to transform the structural elements of the world economy, which are related to the so-called “Globalisation 2.0,” that is, building new communication channels and including the previously peripheral regions such as Western China into the development of world economy. For example, developing the digital economy, drawing in new sources of energy, using more green energy etc. are also important parts of this concept. By the way, the reconstruction of the Eurasian economic region by nature means the geoeconomic reorganisation of China. The advantages resulting from this reorganised world (e.g. better efficiency performance and organisation) all serve China’s aim to avoid falling in the middle-income trap. If China continues to develop in a traditional way, that is, it keeps on using the old economic driving forces for growth, then it will not move forward in the international economic value chains, but will get stuck in the middle-income trap like many countries in Southeast Asia and Latin America before. So, the BRI as such also fits organically into this Chinese political concept, i.e. the other elements of President Xi’s complete strategy. This means technological advancement and the introduction of economic innovations to change the structure of economy. Certain sectors of the Chinese digital economy have gained advantage compared to the Western ones simply because they introduced new technologies faster and more efficiently. For example, technologies used by different Chinese e-commerce companies or mobile payment which costs less therefore it is more efficient. Nevertheless, there is no guarantee that history, others, or the circumstances will not throw sand in the works. Thus, we should neither underestimate nor overestimate this initiative. One part of the academic literature argues that the BRI is not “serious business,” it is all about the Chinese trying to sell their excess supply. According IN FOCUS

to the other part, however, it is a threat and we are certainly setting the scene for the next world war. None of these are true. You have only briefly mentioned the “16+1.” How would you evaluate the first 5-6 years of this cooperation? What is its significance for Central Europe and Hungary? I think that the “16+1” was a product of the global economic crisis in 2008–2010 and the significantly flawed EU responses to it. The “16+1” would have never been launched, if the EU had managed the latest global economic crisis and all of its consequences in a manner that takes the interest of every member state into account. It was not managed in that manner, therefore a demand for market access and financial, economic, technological, and other resources from outside of the EU has emerged within certain groups of the EU member states. This was the given framework of motivation that brought this cooperation into being. The Central and Eastern European (CEE) region consists of three (or four) subregion, which, due to historical reasons, have their own, distinct sense of community (namely Western Balkan, Eastern Balkan, V4, and Baltic identity). However, there are a lot of fragmenting factors and competition between the countries. Currently, this cooperation is in such a state as it can be in this historical setting and structural form. Particularly, if we consider that the EU—and its dominant member state, Germany—fundamentally opposes this cooperation, since today most of the CEE countries are integrated into the economy of EU through the German economy. Every Chinese investment which is made in the CEE region has one common feature: it is not German. That hurts economic interests. The “16+1” can only develop further if the success of projects can prove that such flourishing cooperation is beneficial for Europe as well. If projects advantageous for all economic actors succeed, these relations will balance out. Moreover, in respect of the “16+1,” it is time that the CEE countries launch their own independent consultation mechanism. They should harmonise their interests and not compete with each other but rationally formulate their needs and communicate them to the Chinese. Finally, 14

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these sixteen countries should openly, in a nonconfrontational manner advocate for the “16+1” to be organically integrated into the BRI and present this idea to China as well. It is in the best interest of CCE countries to make both the West and the East realise that the “16+1” is an integrated part of the BRI, with its own unique features. Most of the activity within the cooperation takes place in the economic space of the EU, which has different rules—it is not a value judgement, they are simply different. The “16+1” has and can have a great perspective but only if it sets the goal of solving the issues which have become obvious in the last couple of years. Thank you very much, Your Excellency!

The interview was conducted by Tamás Péter Baranyi and Viktória Anna Papp on 9 January 2017.

INTERVIEW

CHINESE–HUNGARIAN RELATIONS IN LIGHT OF THE NEW CHINESE INITIATIVES Interview with H.E. Duan Jielong, Ambassador of the People’s Republic of China to Hungary

In the past few decades, China has changed radically, it has shown and continues to show fast development into a modern major power. How do you see the growing role of China in the global economy and its more active stance? Since the introduction of the reform and opening-up policy, China has made leaps and bounds in the economic, scientific, technological, and cultural fields, as well as sports, education, environmental protection, and all other social areas. With the continuous and encompassing growth of China’s overall power, it has increasingly come into the centre of international life and is playing an increasingly active role. China contributes 30% to the growth of the global economy, more than the United States, Japan, and the Eurozone combined. Its contribution to combating poverty is also significant—over 70%. In this field, it has achieved a veritable miracle in the history of mankind. It

also plays a significant role in maintaining global peace. Of the United States Security Council’s five members, China provides the most peacekeepers, and its peacekeeping expenditures are the second highest. In addition, with initiatives such as the joint development of the One Belt, One Road, China has become an important contributor to global governing, trade liberalisation, and the open global economy. As President Xi Jinping pointed out in his report at the 19th Congress of the Chinese Communist Party, China has reinforced its major power diplomacy with a domestic flavour, has promoted the emergence of a new type of international relations and the common fate of humanity. While remaining committed to these convictions and its assumed responsibilities, it is also expanding its manoeuvring space in line with the expectations of the international community. Beyond the above, it is turning its attention towards the world in order to create an even better environment for its own development and is committed to be a builder of global peace, a contributor to global development, and defender of the world order. It is employing the wisdom of Chinese people and Chinese administration to solve humanity’s problems. At the recent successful conclusion of the 13th National People’s Congress and first session of the 13th Chinese People’s Political Consultative Conference, the President of the State Council said in his governmental assessment speech that China remains committed to a national policy open towards the world and supports the establishment of a new form of complete openness. It strives to promote the creation of a new type of international relations based on mutual respect, equality, and INTERVIEW

fairness and cooperation beneficial to all those involved. As a responsible country, it will continue to do its part in solving international and regional problems and contributes to the establishment of global peace and development. China is ready to tirelessly work towards the common future of humanity with every nation. In your opinion, how could a medium-sized country such as Hungary best take part in the defining foreign policy initiative of the coming decades, One Belt, One Road? In 2013, China presented a cooperation initiative, envisaging to establish the Silk Road economic areas and the 21st-century Maritime Silk Road, garnering significant attention and active contribution from the international community. The One Belt, One Road Initiative stands by the principles of shared discussions, shared building, and shared results. Its most obvious qualities are equality, openness, and an inclusive approach, in which all countries are equal regardless of size and various cultural systems gain mutual acceptance. Be it an avenue of cooperation or delivering a specific project, everything happens according to the agreement of the participants in a fully transparent manner. So far, over 80 countries have signed an accord with China to take part in establishing the One Belt, One Road. Last May, representatives of more than 140 countries attended the Belt and Road Forum for International Cooperation held in Beijing, illustrating the confidence and support of the international community for the project. The geographic endpoint of the One Belt, One Road is Europe. The European countries— Hungary among them—could all be important participants and partners in building the One Belt, One Road. When foreign minister Wang Yi visited Hungary in June 2015, the two sides signed an inter-governmental agreement laying down the conditions of cooperation in jointly advancing the building of the One Belt, One Road. It is quite important that Hungary was the first European country to sign such a document with China. Hungary is located in the middle of Europe and has considerable geographic advantages, a developed transport infrastructure, and logistics capabilities. Bilateral relations have been put in a higher gear in 16

INTERVIEW

the past few years, cooperation continues in several areas, creating good conditions for both countries to build the One Belt, One Road. In the future, we will reinforce sectoral policy cooperation and strategic communications, already existing cooperation in economic, trade, investment, financial digital economy, and cultural exchange in order to achieve results mutually beneficial for both nations. What new avenues does the “16+1” Cooperation between Central and Eastern Europe and China open for these countries? How does it fit into the previously discussed One Road, One Belt initiative? The cooperation of China with Central and Eastern European countries (the “16+1” Cooperation) is a common platform to further friendship and mutually beneficial cooperation. Due to the joint efforts of 17 countries, the “16+1” Cooperation has flourished, offering important development possibilities for every country, created a more solid base for cooperation and the road forward has been better defined. Central and Eastern Europe—as an important region of the One Belt, One Road—have a central role in promoting the initiative. All 16 countries have signed a cooperation agreement with China. Since then, many joint projects have already brought results, further enhancing bilateral relations and practical cooperation between China and the European Union. In November 2017, Budapest hosted the sixth “16+1” summit, during which the participants made public the Budapest Guidelines for Cooperation between China and the Central and Eastern European countries, which also says that based on the “16+1” Cooperation, the countries wish to continue discussions about the One Belt, One Road, its construction and sharing its benefits as well as supporting the integration of this initiative with European investment plans and other significant projects. All those involved will maintain close relations and dialogue, expand the areas of cooperation, develop new methods, and further build a lasting, pragmatic, and efficient “16+1” Cooperation. We will also strive to make this cooperation an important element of the One Belt, One Road initiative during the integration in the European economic areas.

What results has the “16+1” produced so far? What effect will these frameworks for cooperation have on Chinese –Hungarian relations? What challenges are ahead of us? As a common platform, the cooperation between China and the Central and Eastern European countries not only contributes significantly to the joint projects of the participants, but it is also a significant component of China–EU cooperation. Since its establishment, the “16+1” has been instrumental in achieving major political, economic, trade, transport, logistics, infrastructural, and human results. On the one hand, political trust is advancing under the guidance of high-level leaders. Highlevel meetings between China and the 16 Central and Eastern European countries are frequent, the sides respect the principles of mutual respect and equal treatment, they take into account others’ fundamental interests and major viewpoints, while they continue to improve their relations in general. China has established encompassing strategic partnerships with Serbia, Poland, and Hungary, and strategic partnership with the Czech Republic. On the other hand, concerted economic cooperation is also making steady progress. Bilateral trade volume between China and the EU has grown from USD 43.9 billion in 2010 to USD 58.7 in 2016. We are also making steady strides in expanding production capacities, infrastructural, and interconnectivity projects. The Budapest–Belgrade rail line, the China– Europe road and maritime expressway, the development of the Three Harbour area, and other major projects are advancing in order, while financial cooperation has also improved. Third, through a combination of several measures, we also managed to continuously improve cultural ties: we support the exchanges and cooperation in various areas such as education, culture, healthcare, tourism, and media as well as knowledge centres, political parties, youth, and settlements. We have organised many colourful cultural exchange programs such as the year of tourism in the “16+1,” or the year of cultural exchange and that of the media. Hungary, as the first host of the China–CEEC Economic and Trade Forum, has made an

THE GEOGRAPHIC

ENDPOINT OF THE ONE BELT, ONE

ROAD IS EUROPE. THE EUROPEAN

COUNTRIES—HUNGARY AMONG THEM—COULD ALL BE IMPORTANT

PARTICIPANTS AND

PARTNERS IN BUILDING THE ONE BELT, ONE ROAD.

outstanding contribution to the development of the “16+1” Cooperation mechanisms and has always played a leading role in our common efforts. The “16+1” is an important platform for further developing pragmatic cooperation between China and Hungary, while it also plays a major role in raising bilateral relations to the next level. China and Hungary will continue their efforts to actively promote the development of the “16+1,” while also ensuring its stability and long-term viability. Regarding economic and trade relations with China, in which particular areas do you think Hungary can be competitive within the CEE region? In 2017, Chinese–Hungarian bilateral trade has reached a record high, breaking through the USD 10 billion dream limit. Hungary remains China’s third largest trade partner in the CEE, while China is Hungary’s largest non-EU trade partner. In more detail: Hungarian exports to China have grown by 18%, making Hungary the largest exporter to INTERVIEW

China within the Central and Eastern European region. Chinese exports to Hungary rose by 11.5% to USD 6.05 billion. Bilateral trade mainly consists of high value-added electromechanical and high technology products, such as engines, electrical equipment and spare parts, boilers, machines and machine parts, vehicles and vehicle parts, as well as optical, photographic, and medical equipment and parts. These combined account for 80% of bilateral trade. It is also worth mentioning that the export of Hungarian agricultural products to China is growing steadily, with Hungary having the highest number of agricultural export licenses to China. How would you rate Chinese –Hungarian bilateral relations? What are the main pillars of cooperation? What results have the last few years brought, and which of these do you consider as most significant? Friendship between the two countries and peoples is traditionally good, while diplomatic ties and cooperation have a long history. Hungary was among the first to recognise China as a state 69 years ago and establish diplomatic relations. Ever since, Hungary and China have been promoting the improvement of bilateral relations based on the principles of equal treatment and mutual benefits. There is a steady growth in avenues of cooperation and existing ones are growing in substance. Last year, the relation of the two countries has changed, becoming a strategic partnership, so bilateral relations have reached a historical height. The Hungarian government’s Eastern opening strategy shows a high degree of harmony with the One Belt, One Road initiative, the convergence of which plays a major role in deepening the friendly and pragmatic cooperation of the two countries. With the help of the One Belt, One Road and “16+1” Cooperation, economic, trade, investment, financial and cultural relations show great progress. Today, China is Hungary’s biggest non-EU trade partner, while Hungary is the most important destination for Chinese investments and the third largest trade partner in the CEE region. Chinese investments to Hungary stand at a total of USD 4.1 billion. Bilateral financial cooperation is also best in the region. The 18

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first Central and Eastern European RMB clearing centre was established in Hungary, and Hungary was also the first to issue renminbi-denominated dim sum bonds at a value of 1 billion renminbi. It has also prolonged the 10 billion renminbi/416 billion forints currency exchange agreement with China. The highly successfully Confucius Institutes in Hungary actively contributes to Chinese and Hungarian education and also promotes traditional Chinese culture. With the help of the Chinese and Hungarian government, the first bilingual (Hungarian–Chinese) secondary school in Europe has been opened, ushering in a new era Chinese language tuition in Hungary. Last year more than 230,000 Chinese tourist came to Hungary—a 35% increase from the previous year. This is sufficient proof that the friendly cooperation between China and Hungary has a solid basis and wide perspectives. How would you qualify higher education and scientific relations between the two countries? In which areas do you see future potential? Educational cooperation between China and Hungary has always been excellent, with the countries’ bilateral educational agreements offering political guidance and guarantees for exchanges in specific areas. Over the past decade, several Hungarian and Chinese universities have established formal relations. The cooperation agreement signed last year by the Heilongjiang Regional Educational Office and the Hungarian Ministry of Foreign Affairs and Trade furthers the cooperation between the Heilongjiang University of Traditional Medicine and the Semmelweis University of Medicine. During Prime Minister Li Keqiang’s visit to Hungary last November, the Fudan University and the Neumann János University signed an agreement on establishing joint tuition, a good starting point for raising cooperation between the two institutions to the next level. China also welcomes the Hungarian leadership’s idea that a Chinese university should set up a campus in Hungary. The two countries’ relevant educational authorities or institutions could reinforce communication and coordination in this area, devising a solution whereby both sides could use their capabilities for the common benefit. At

the same time, the number of foreign students is growing rapidly in both countries. So far, almost 2,000 Chinese students have come to Hungary to continue their studies, of which the number of those with state scholarships has grown by over 30%, to 400. 78 Hungarian students are currently studying in China and their numbers also show a growing trend. The two sides will explore the possibilities of further increasing scholarship quotas in order to educate more and more builders of the Chinese– Hungarian friendship. Next year, the People’s Republic of China will celebrate the 70 th anniversary of its establishment while Chinese –Hungarian diplomatic relations will also mark their 70 th year. What preparations are underway in China and here in Hungary? This is an important milestone in the history of the countries’ relations. We should celebrate together, share the joy, and pass on the deep friendship, give new impetus to expanding the comprehensive Chinese–Hungarian strategic partnership. I believe both countries will organise several events to commemorate the everlasting Chinese–Hungarian friendship and we welcome everybody’s active participation. What aspect of China do you miss most here in Budapest and what do you like most in Hungary and the Hungarian people? I have been in Hungary for about three years. During this time, I have seen many places and made a lot of Hungarian friends. The warmhearted, welcoming Hungarian people, the endless Hungarian historical culture, the nice climate, and beautiful natural environment have made a lasting impression. I would like to take the opportunity to talk about the exquisite Hungarian architecture. The original name of my downtown residence is Lánczy Palace. It was built at the end of the 19 th century by two of the era’s finest architects, Kálmán Griegl and Flóris Korb for parliamentary representative Leó Lánczy, who later became President of the Hungarian Commercial Bank. The exterior of the residence is majestic, the interior is a work of architectural art. The irregularly shaped oval staircase, the hand-wrought iron railings, and

the Hungarian-style stained glass windows are all fine examples of that time’s style. In Budapest, you can find beautiful buildings almost everywhere: a seemingly anonymous corner building can often be a centuries-old masterpiece. And the New York Café, the Museum of Arts and Crafts, and the Parliament are fascinating! In contrast, there are less of the “four great discoveries” of China here: high-speed railways, mobile payment, public bicycles, and e-commerce. In this time of information and digitalisation, these are all symbols of people’s desire for improved quality of life. I wish everyone could visit China and experience our country.

Interview by Viktória Anna Papp INTERVIEW

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THE MIDDLE KINGDOM— A CIVILISATION SPANNING THROUGH CENTURIES

The Four Great Chinese Inventions Noémi Eszterhainé Szőke

It is commonly known that the ancient Chinese gave numerous breakthrough inventions to the world.

Tamás Péter Baranyi

Among these outstand the so-called “big four” (si da faming), which have also become the symbol

of the scientific and technological development

achieved by the Chinese civilisation through its

China is home to one of the oldest civilisations of our globe, where the traces of rice cultivation date back to the Neolithic Period, cca. 8000 BC. The cave art of the early Jiahu and Damaidi cultures of the Yangtze River Valley is enriched by the characters of the Chinese proto-writing system. Silkworm production that developed in conjunction with Chinese culture itself also dates back to cca. 5000 BC. The Bamboo Annals and the Spring and Autumn Annals tell the story of

long history, and which, at the same time, had remarkable impact on the technical development of the entire world.

One of the great inventions is the technique

of papermaking, accredited to Cai Lun, a court

official serving under the rule of the Han Dynasty

(202 BC–220 AD). Cai first presented his paper

made of mulberry fibres, other types of bast fibres, and old rags to the emperor in 105 AD. Although,

according to the latest findings, paper had been known in China for centuries before that, its mass

production and wider usage for writing only started

after Cai’s invention. By the 3 th century, paper displaced silk and bamboo slips. Then, by the 6th

century, papermaking became so common that even toilet paper was made, and not much later

the Song Dynasty (960–1279 AD) released the first paper money in history.

The second great invention is the compass. The

magnetic property of lodestone had already been known in the Warring States period (5th–3rd century

BC), however, they were only used for fortune telling and making prophecies, not for navigation. What is intriguing about this mechanism is that,

unlike in its Western counterpart later, the magnetic part pointed toward the south. The first record of using a compass for navigation was found in a

yearbook dating back to 1040–1044 AD, during the Song Dynasty. Although the Chinese had also known

the dry compass, which was widely used in Europe centuries later, the so-called wet compass, in which

the magnetic plate or needle floating in a bowl of water helped the navigation, was more popular.

The third important invention is printing. The

simpler form of printing, the so-called woodblock printing, was already known in China under the

Tang Dynasty (618–907 AD). The earliest known Cover of Bamboo Annals, 1806

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printed Chinese work is a Diamond Sutra from

868 AD. For this printing technique, they used individually carved wooden boards with the inverse of a given text or pattern carved in them. Movable

type printing was invented by Bi Sheng, who was

the first to apply reusable terracotta blocks for printing in 1041. The technique did not become widespread in China because of the great number

of Chinese characters, however, it did revolutionise printing across the globe later.

The fourth great invention is the gunpowder,

which was invented in the 9th century AD. Although the main components (charcoal, sulphur, saltpetre) had been already known and used in Chinese

medicines under the Han Dynasty, gunpowder

itself was later invented by accident. For hundreds of years, many Chinese emperors wanted to find

One phase of the paper-making process (Ming era woodcut)

the elixir of life. Through his experiments, one of the

imperial alchemists discovered a very flammable material, called â&#x20AC;&#x153;fire medicineâ&#x20AC;? (huoyao). The mixture

had no life-lengthening properties, but other uses of it were soon recognised. Although fireworks and firecrackers have been very popular from

the beginning, contrary to the myth, gunpowder

was not only used for entertainment purposes. There are records from the time of the Tang Dynasty about the military use of gunpowder, and under the

Song Dynasty, this field of usage further extended: miniature rockets and bombs were made as well.

Chinese characters carved into movable clay blocks

One of the early methods of using gunpowder: the rocket

Chinese compass

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Zhongguo

the dynasties in China in order from 2000 BC on. The great epochs and personalities of Chinese history, Laozi, Confucius, Sunzi, the Spring and Autumn period (722–476 BC), and the Warring States period (476–221 BC) are all recounted in those chronicles. After the dynamic decades of those conflicts, Qin Shi Huangdi brought about a new era with the unification of the country: the era of Imperial China. Unlike in Europe, paper, gunpowder, compass, and levied armies and navies were all known and used in Qin China. An extended network of silk and china trade and a standing scholarly administrative elite was also maintained. Those civilisational achievements and characteristics were there to stay for the coming centuries, during which the different dynasties gained more and more territories. For a comparison, we can look at the Carolingian Empire which comprised an area of 1,112,000 km2, while on the other side of the Eurasian landmass, the Tang Emperor had 5,400,000 km2 under his sceptre. The Chinese called these lands the Middle Kingdom (Zhōngguó). The name referred to both the centrality of China on the map and its indivisibility: it was the only country under the heavens, relative to which all other countries were underdeveloped and subordinate, incomparable 24

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Qin Shi Huangdi

to the Chinese civilisation. Later, this concept was modified when China became divided once again, and the nomadic Khitan people, who settled down in the Northern regions, have adopted the Chinese culture. In the Treaty of Chanyuan, the Northern Song and the Southern Liao dynasties addressed each other as “brothers,” and in effect conceded to the division of China. The integration of “barbarian” dynasties and peoples into China had always been on the agenda from this treaty on. China experienced many other cycles of disintegration and reunification in the coming centuries. The trade between Europe and Asia has been dominant throughout most of the world history. On the route, named Silk Road in the 19th century, the two ends of Eurasia maintained relations through Central Asia and the Middle East. This relationship had already been alive and vivid during the times of the Roman Empire. In fact, there is written evidence of it from the time of Antoninus Pius (138–161 AD), who is referred to as Andun, Emperor of Daqin in Chinese sources. The basis of trade had always been silk, but china, tea, spices, and exotic fruits were also exchanged on this intercontinental route. It was a general rule that European countries were making trade deficit in the process. This deficit was not only due to the fact that European goods had a

7,000

6,500

6,000 4,897

5,000 4,232

tonnes

4,000 3,000

2,553

2,000

1,390 347

1,000 50

1650

1775

200 1800

1822

1835

1839

1863

1867

1880

Opium imports into China 1650–1880

smaller market in China but also to the transit costs: Byzantines, Venetians, Arabians, and Ottomans made the trade between Northern Europe and the Far East rather difficult. In the Middle Ages, this led to the emergence of the Eastern Mediterranean and the relative dependence of Northern and Western Europe. The frustration ensued, and it became a motivation for the development of navigation and cartography in return. The most enduring effect was probably brought about by the book of the Venetian tradesman, Marco Polo, who wrote a detailed description of his journey to China between 1271 and 1295. The book, De Mirabilius Mundi, not only depicted China’s measureless wealth but also talked about how to access the Middle Kingdom on land. The emergence of the need to reach China by sea was only a question of time. TEA AND OPIUM In the Age of Discovery, the Europeans not only connected the Americas to world economy but also learned to circumnavigate Africa and found a safe route to India, reaching their goal to set up merchant colonies in Asia. A new, immediate sea route increased the volume of Asian– European trade but also altered the conditions of demand and supply. For some time, the demand

for exotic spices have grown so enormous that it made European traders rolling in money. Several expressions in European languages are rooted in this experience: for instance, the Dutch pepperdur means “as expensive as pepper.” The role of spices were nevertheless soon taken over by textiles and two special crops: tea and poppy. According to the tradition, tea was introduced to England by a Portuguese princess, Catherine of Bragança, who married King Charles II and brought her lands in India to the English royal family as dowry. It is surely known that England has indeed rose to be the top tea consumer in the world during the 18th century. Since around 1700, there was no direct contact between England and India, tea had to be procured for in the Netherlands. In 1720, the English government stopped the import of textiles from Asia, thus narrowing the focus of the Mighty East India Company to tea. The increase of supply created an enormous demand: the English need for tea quadrupled every 20 years. Tea drinking and the import of other Chinese goods generated a huge trade deficit because English products were not as popular in China as the other way around. There was only one thing the Chinese merchants were interested in: silver. But England BROAD STROKES

The Imperial China era begins. The First Emperor linked the Great Wall together. Confucius (551–479 BC)

8 The Song empire was technologically and scientifically most advanced in the world at the time. In 1024, it issued the world’s first paper money.

Byzantine Empire

Tang Dynasty 618–907

70 0

Sui Dynasty 581–618

Southern Dynasty 420–589

Northern Dynasty 386–581

Eastern Jin 317–420

Three Kingdoms Period 220–380 0 20

Large-scale trade developed on the Silk Road routes.

Western Roman Empire Chinese Empires.

between the Roman and the

16 0

commercial traffic existed

10 0

Xin Dynasty 9–24

Qin Dynasty 221–206 BC

Western Han 206 BC–9 AD

Spring and Autumn Period Warring States Period 0

0 15 0

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Roman Empire

There is evidence that lively

Culture

Ancient Greek City-States Mycenaean

Minoan Culture

Western Zhou

Shang Dynasty 1600–1046 BC BC 0 15 0

Xia Dynasty 2070–1600 BC

3 Eastern Han 25–220

Zhou Dynasty 1046–221 BC

Western Jin 265–316

One of China’s most prosperous dynasties had China’s only empress regent (r. 684–705).

Sixteen States 304–439

The Mongol-led Yuan Dynasty was established by Genghis Khan’s descendants. It was the first foreignled dynasty in China.

Eunuch Cai Lun improved papermaking technology.

In 1368, Zhu Yuanzhang, a peasant rebel leader re-established Han-Chinese rule. Eunuch Zheng He led seven ocean voyages to Western countries (1405–1433).

Modern Europe

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People’s Republic of China 1949–present 00 20

0 19 0

0 18 0

17 00

0 16 0

18 41

The first Opium War

Republic of China 1912–1949

Qing Dynasty 1644–1912

The Reformation 14 92 15 00 15 17

The Discovery of the Americas

0 12 0

11 00

10 0

Medieval Europe

Liao Dynasty 916–1125

Ming Dynasty 1368–1644

14 0

Southern Song 1127–1279

Western Xia Dynasty 1038–1227

Jurchen Jin Dynasty 1115–1234

Yuan Dynasty 1279–1368

Marco Polo’s first journey to China

Northern Song 960–1127

Emperor Wen built the Grand Canal and had rebuilt the Great Wall.

12 71 13 00

Five Dynasties and Ten Kingdoms Period

The Manchu-led Qing Dynasty was the last imperial dynasty in China. Since the first Opium War in 1840, China was a semi-colonial, semifeudal country.

did not have that much silver, so the English had to buy Spanish silver in gold to be able to trade with China. As trade deficit was constant and the dissipation of the precious metals continued, the British wanted to find a solution. The relative failure of the so-called McCarthy Mission of 1793 made it clear that the Chinese imperial court was not interested in Western inventions, clocks, firearms, or telescopes. There was, however, one product that generated demand in the Middle Kingdom, especially since it had been banned in 1720: opium. That is the reason why the British East India Company decided to use its Indian territories to ease the dependence on China. They started to cultivate tea and opium, the former to supply the needs in Britain, the latter to scale up Chinese demands. As the number of tea chests landing in Britain continued to rise, so did the volume of smuggled opium in China. The Chinese did not stand idly by the devastation of their economy and public health, so they tried to counteract with newer and stricter measures from the 1830s and pledged to enforce them more severely. As the Chinese wanted to halt British Indian opium trade and the British were aware of their dependence on the relatively free opium trade, a conflict was inevitable. The Daoguang Emperor and his administration faced a great dilemma in 1839, i.e. whether to legalise and tax opium trade or entirely ban opium and find the means to enforce this measure. The scholar official Lin Xezu, who is well revered in China ever since, was tasked with the elimination of the problem: his personnel seized more than 20,000 chests of opium, over 1,200 tons only in 1839 from British merchants and demanded that opium smugglers be sent to Chinese, not English courts. Both were unacceptable for Britain, which led to the First Opium War (1839– 1842), during which the British were able to crush China with their superior firepower and fleet. The 1842 Treaty of Nanjing provided that five ports, including Guangdong and Shanghai, had to be kept open for foreign merchants, and Hong Kong had to be handed over to Britain, besides, the principle of extraterritoriality was codified, and a reparation had to be paid for the confiscated goods while tariffs on foreign goods were fixed 28

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at a conveniently low value. The Second Opium War (1856–1860) and the extending colonial activity of the Japanese and the Europeans signalled that China was no longer able to compete the colonial powers and could not launch an overarching reform on her own. THE RE-EMERGENCE OF CHINA The period between the Opium Wars and the proclamation of the People’s Republic of China is often called “the century of humiliation” in the country. The concept of the Middle Kingdom was no longer applicable: China, after having thought of itself as the axis of the world and the cradle of civilisation for centuries, has now been downgraded to a semi-colony of European “barbarians.” The lacklustre court has lost its legitimacy partly due to the Manchu origin of the dynasty. The Xinhai Revolution of 1911 and the making of the Chinese Republic, however, did not solve the problems: the father of the Republic, Sun Yat-sen soon died and China fell apart to become pray to various warlords, while foreign powers only strengthened the isolation of the Chinese economy. The Chinese Civil War, which lasted for decades with changing intensity, along with the Japanese occupation, further eroded the country’s natural and human resources. The end of the Chinese Civil War and the establishment of a strong central government in 1949 was a turning point in China’s relations to the world. The unequal treaties were no longer in effect, elements of the semi-colonial status disappeared— though Macau and Hong Kong remained in foreign hands until the end of the century—and the new process of nation-building by communist ideology has started and lasted for decades. China has built a unique, national type of communism which left more room to private capital than the Soviet version. China’s robust growth has already started in the early years of the People’s Republic, albeit with significant oscillations: the shocks of the Korean War, the various campaigns, or the Cultural Revolution always had an impact on the economy as well. In the mid-1960s, squaring off against the hegemon Soviets created new ways for China: it made a rapprochement with Western countries, especially with the United States, possible. In 1978, when Deng Xiaoping announced the politics of

reform and opening-up, China could build on the following bases: industrial growth and trade concentration, better access to Western capital, and the societal need for political innovation. Deng Xiaoping’s reform and opening-up has since been the cornerstone of the Chinese state. In the 40 years that have passed since 1978, China did not only continue to grow economically but went global. In fact, China has become as important in the global economy as it was before 1842. The United States and China, the leading players of world economy, are now heavily interdependent. Niall Ferguson and Moritz Schularick coined the term Chimerica in 2006 to address this phenomenon. China is not only far from being kept out of the international system, but it has also become a dominant player by now, and we can surely expect its influence to grow both in economic and political terms. “The emergence of China” is an often-emerging topic in the West; however, it is somewhat strange for the Chinese mind. From Beijing’s point of view, the present “emergence” is less striking than the low ebb reached during the 19–20th centuries. The Chinese, with their notion of being the Middle Kingdom, have always considered themselves as one of the powerhouses of the world. Now, after one

and a half century of anomalies, they are well aware of the strength of their civilisation, the dominance of their economy, and their growing political influence once again. From the Chinese perspective, this is about setting things right, back to their natural order. One element of this could be the ambitious Belt and Road Initiative, the purpose of which can be perceived as a reinvigoration of Eurasian land routes of trade which once made China rich but were downgraded after the Age of Discovery. For two distinctive reasons, the past couple of decades are seen in China as returning to the “natural order”: back to China’s centrality and greatness and back from the dominance of Atlantic trade to Asian trade.

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MAIN LINES OF CHINESE FOREIGN POLICY IN THE XI ERA dr jur. Tamás Matura

Chinese domestic policy is inherently mysterious, opaque, and difficult to fathom. The Chinese themselves consider that political analysis is akin to predicting the future from tea leaves. Figuring out Chinese foreign policy is just as daunting a task, given that the Beijing regime— probably on purpose—is notoriously tight-lipped regarding strategy and frugal in releasing strategic documents. In predicting the future course of Chinese foreign policy, analysts must thus resort to general patterns of foreign policy, China’s interests, prior behaviour, and the reactions of neighbouring states. Fortunately,

Xi Jinping at the 2017 World Economic Forum in Davos 30

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we have now been given a rare opportunity as President and General Secretary Xi Jinping gave a three and a half hours long speech at the 19 th Congress of the Chinese Communist Party (CCP) in October 2017. This speech offered an exciting glimpse into the overarching strategy of Xi and China and its foreign policy implications. Below, we will give an overview of the main stages of development of modern China and to what extent Xi’s agenda might represent a new era and its possible ramifications regarding the international behaviour of China.

MILESTONES OF MODERN CHINESE POLICY In his speech, Xi heralded a new era, placing his rule at the level of two previous defining periods in Chinese policy. The first era is of course that of Mao Zedong, which may have had many catastrophic economic and domestic policy implications, but on a strategic level, the “Great Helmsman” is still revered in the country. The reason for this is that according to domestic political lore, Chinese people suffered indescribable hardships during the “century of humiliation” prior to the proclamation of the People’s Republic of China (PRC), which was ended by the a CCP led by Mao. Since the beginning of the First Opium War in 1839, the Chinese have been subjected to a century of continuous uprisings and wars. The “century of humiliation” was not only an era of foreign invaders but one marred by internal discord, culminating in a decades-long civil war and Japanese occupation. An indication of the devastation is that in the second half of the 19th century the country’s population has effectively stagnated because the loss of tens of millions of lives in these turbulent times outstripped the natural growth of the population, while China’s share of the world’s economic output fell from 33%

in the 1820s to a mere 4% in 1950. The Mao era put an end to this: Chinese still consider that Mao established a new China and restored the country’s independence and sovereignty. The second era was the reform and opening-up policy of Deng Xiaoping and his successors, Jiang and Hu. Following the oftentimes haughty and self-imposed isolationism of the Middle Kingdom and the peculiar Maoist People’s Republic, came the gradual emergence of a new state, that of a China open towards the global stage, soaking up capital, technology, and knowledge. Deng’s policy consciously took advantage of the possibilities offered by the size of the Chinese market and the natural traits of Western capitalism. Overseas, he made the best of the globalising, liberal market economy that emerged after the Cold War but restraining the same market economy at home, creating a colossus that following two centuries of relapse grew into the world’s largest GDP by purchasing parity in 2015. At the same time, recognizing the relative frailty of the country, his famous 24-ideogram exhortations Deng left a foreign policy heritage based on withdrawal, conflict-avoidance, hiding the country’s true

The Chinese People’s Liberation Army—one of the world’s largest armies BROAD STROKES

capabilities, and patience. To summarise, we can state that while the Mao era restored the country’s sovereignty and Deng laid down the economic fundaments, Xi’s plans envision a third era, that of regaining power. THE XI ERA Most analysts agree that Xi Jinping, who has previously already centralised power to a significant degree, further solidified his position during the 19th congress of the CCP on 18–24 October 2017. While all the previous Chinese leaders developed their own ideologies and left them as their heritage, Xi was the first one since Mao to have his name and directives written into the CCP’s constitution in a document entitled Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era. This also means that his successors will be bound by the directives set by him. In his speech at the congress, Xi spoke about the following fourteen points of his directives. First, just like in the prior decades, the primary goal is to preserve the leading role of the party. Second, he reiterated that the policy focused on the population has to be continued, meaning that with regard to the growth of the Chinese economy, there has to be a stronger emphasis on living standards of the average citizen and solving their problems rather than just chasing headline economic indicators. Third, he mentioned the continuation of sweeping reforms maintaining Deng’s inheritance, given that the reforms started four decades ago are crucial for future economic and social advances. The next few points emphasised the importance of sustainable and environmentally conscious development, advancing the rule of law, maintaining the core values of Socialism, and continuous increase of living standards. However, in a departure from previous practice, Xi gave more detailed and clear outline of China’s foreign and defence policy aspirations, which in itself marks a new approach. Four of the fourteen points (10–13) regard foreign policy, also marking a gradual departure from Deng’s line. According to the exhortations published in the 1990s, China must act on the international stage as a quiet observer with the main priorities being the protection of the nation’s positons, hiding its 32

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capabilities, avoiding centre stage or lead role, until the time of the country has arrived. It seems Xi now believes that the time has come for China to reassume its role as a leading player on the world stage and to shape its foreign policy accordingly. He also said that reacquiring the positon of a major power can only be achieved on the basis of Mao’s sovereignty and Deng’s economic prosperity. Accordingly, China is continuing its pivotal military developments such as boosting its naval power, the de facto occupation of the South China Sea, upgrading its air forces and preparations for cyber warfare. The Central National Defence Committee established a few decades ago has reinforced the President-General Secretary’s command of the People’s Liberation Army, and the process intrinsic to reinforcing global Chinese influence has also begun: namely, the reorganisation of the Foreign Ministry and significantly increasing Chinese diplomats’ purview. There is also a symbolism in the fact that while the U.S. diplomatic service has been in severe crisis since the Trump administration took over, Beijing has begun expanding the scope of its foreign service, reinforced the scope of the foreign ministry, and allocated additional funds towards these. The increased importance of foreign affairs is also evident in Chinese domestic policy, due to the fact that former foreign minister and foreign deputy minister until March 2018, Yang Jiechi was the first leading diplomat to be included in the 25-strong Politburo of the CCP in the past 20 years. Xi has also touched upon to contentious issues such as that of Taiwan and the problem of “one country, two systems,” involving Hong Kong and Macau. From a foreign policy perspective, the most important aspect of the Secretary General’s speech was his announcement that China has to play an important, central role in the world again and that the country will achieve this major power status by the year 2050. This is in stark contrast with the previously mentioned Deng policy and puts special emphasis on the last part of the document included in the party constitution, Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, meaning that the “New Era” will be about gaining power.

WHAT IS TO COME? For those familiar with Chinese foreign policy, Xi’s announcements are neither surprising nor do they represent a major change in direction. In fact, parallel with the country’s economic development, Beijing has been moving away from Deng’s exhortations for some years, pursuing a more active (some say more assertive) foreign policy. This has already begun in the Hu Jintao era, but the significant international successes of the past few years (hosting the Olympic Games, reacquiring economic power, etc.) have allowed Xi to announce the advent of a new era—with an eye on his own political interests and legacy. At the same time, the United States’ unexpected and surprising foreign behaviour in the first year of the Trump administration has also forced the Chinese—or presented Beijing with the opportunity—to assume a more active—sometimes even a leading—role on the world diplomatic stage. In the coming years, we expect Chinese foreign policy to become not only more active but also more assertive. Whereas previously has been more inclined to compromise to maintain stable international relations as a precondition for continued economic growth, we can expect a tougher stance in the future on several issues. This will also be amplified by domestic policy because growing national sentiment—often played up by politicians—will raise expectations towards the political leadership, meaning that the hard representation of Chinese interests will be more prevalent. Chinese foreign policy will also be more reliant on the new international institutions and projects launched by Beijing, such as the Belt and Road Initiative also known as the New Silk Road, the Asian Infrastructure Investment Bank (AIIB), or the Free Trade Area of the Asia-Pacific (FTAAP). This was another Chinese initiative that has gained additional momentum with the failure of the American Trans-Pacific Partnership. We must also see that these Chinese initiatives are not separate moves, but rather coordinated steps meant to systematically and gradually increase the country’s international influence. They also run in parallel with the growing global presence of the Chinese armed forces and

attempts to influence global public opinion. All this, of course, is Beijing’s way of asserting its own national interests, having learned the historic lessons of past global powers and applying them in a 21st century environment. Current U.S. foreign policy has also opened up the arena for Beijing in various fields, such as climate protection, free trade initiatives, or shoring up international agreements. In his speech, Xi mentioned several times that China wishes to create a community which will ensure the future of all mankind. In stark contrast with previous decades of communication and garnering significant international interest, Xi also said that China could serve as a role model for other developing countries and Beijing is willing to assist them. Both these announcements mean that China has stepped forward as the shaper of a new world order, one which—unlike the current international order—will be its own creation. This could easily lead to a situation where Western, capitalist, and liberal democracy will cease to be the sole ideal, having an alternative in the Chinese political, economic, and social model. This would not only pose an economic and security policy challenge to the United States and the West but would raise the bar, starting a new race to conquer hearts and minds, rebooting history, that was once believed to have ended.

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CHINA’S GROWING ROLE IN (WORLD) TRADE IN THE 21st CENTURY Dr Ágnes Szunomár

China is the world’s largest developing country, with an economy that is not only already mighty but has been constantly growing over recent decades: While at the turn of the millennium the Chinese economy—based on GDP value—was barely 10% of the United States’, today it is 60%, and measured at purchasing power parity, it actually overtook the U.S. in 2013. The growth of Chinese GDP, which experienced a boom during the 1990s, lasting well into the early 2000s, has been characterised by a gradual slowdown after 2010 (and appears to be finally stabilizing), while the Far Eastern giant’s foreign trade expansion remains uninterrupted. However, this growth also has drawbacks as China’s economic development remains uneven. In the still ongoing economic transformation, the country is facing several difficulties and challenges, while also having unique advantages The pace of Chinese GDP growth (%, 1985-2017) 16 14 12 10 8 6 4

1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Gross domestic product (GDP) in current prices (in trillion US dollars) 25 20 15 10 5 0

2000

2010 China

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USA

2017

and favorable conditions, including a population of over 1.3 billion, which represents a massive market in itself, a stable, altruistic society, innovation capabilities, and a cooperation-friendly business environment. A RETROSPECTIVE Although China was already a notable player in the global economy before the turn of the millennium thanks to Deng Xiaoping’s reform and opening-up policy in the early 2000s, it became a global force to be reckoned with. In addition to the country’s great power ambitions, the reason for China’s increasing role was the realisation of the status resulting from the position it had achieved in world trade by that point, the most visible sign of which was joining the World Trade Organization in 2001. From several perspectives, the key element of China’s economic success has been its exportoriented growth and a development model founded on the efficiency of investments, complemented by a uniquely Chinese mix of trade and exchange rate policies, within the framework of the resulting (due, among others, to these factors) Chinese brand of socialist market economy. However, structural reasons alone would probably not have prompted Chinese leaders to settle on the export-oriented strategy employed by other East Asian countries, but since the primary aim of China has always been the country’s prosperity, they could not afford to ignore the fact that in a massive, continental economy, foreign trade can be a big contributor to GDP growth. In this sense, China’s admission to the WTO was a major stepping stone toward becoming a market economy, as well as a sign of the realisation that this was the only way for the country to stabilise its foreign trade environment, thereby promoting continued growth and ensuring

that it would continue following the path laid out by the Party’s pragmatist leaders. Thus, since the beginning of the new millennium, the country’s role in global trade has only grown just like the volume of its foreign trade. In the meantime, the influx of foreign capital has continued to deepen the country’s global integration, making China one of the world’s primary centers of manufacturing. China’s own foreign investments have also seen considerable growth, at first, because they were a way of satisfying the country’s growing demand for energy and raw materials, as well as ensuring its access to foreign markets, while later capital investments abroad have also been motivated by a deeper integration into global value chains and the desire to become even more relevant. However, China has not been changing in a vacuum over the past two decades, as the world economy itself has also undergone considerable transformation, which has affected China’s role within it as well. The drawn-out aftermath of the economic crisis, the decreasing relevance of countries with high wages in world trade, and the demand for sustainable development are but a few crucial factors, which raise the need for new methods and approaches, new players and roles, as well as taking on a new kind of responsibility. NEW CHALLENGES In 2009, China already became the world’s leading exporter. As a target of working capital, it has been in the top 3 for years: It was number one in 2014, for example, while last year it was still third. Meanwhile, China is an increasingly important investor: In 2011, it was only sixth, but since 2012, it has had held on to third place behind the United States and Japan. Although today the primary goal of Chinese economic policy is the prioritisation of domestic Gross Domestic Product (GDP) at purchasing power parity (in trillion Intl. dollars) 25 20 15 10 5 0

2000

201 0 China

consumption and service-supported growth, this does not mean that China is closing its doors, as foreign trade and the influx of foreign investment continue to play an important role in the country’s economic growth, while its capital investments abroad, together with the increasingly important infrastructural projects, only increase China’s role in and impact on the world economy. In recent years, the Chinese economy has undergone truly fundamental changes, regarding both its goals and structure. The “innovative, coordinated, green, and open” path proposed by President Xi Jinping in connection to the 2016–2020 development goals reflects not only the modern China’s economic problems but also paves the way for long-term progress. Although the results of the recent gradual structural reforms are not immediately visible, their effects are certain to have a positive long-term effect on the quality of the country’s economic development. In addition to the concrete economic measures, other factors contributing to a system that will ensure China’s lasting and sustainable economic development include innovation-driven development, the simplification of administrative processes, as well as the fight against corruption and efforts promoting the rule of law. However, at the October 2017 National Congress of the Communist Party of China, President Xi went even further and declared that the time had come for China to play a leading role in the world. For readers interested in Chinese great power strategies, this concept should not be much of a surprise, and neither should the fact that there are several ways for China to implement the concept, some of which even have recent precedents: At the Davos summit, China acted as the vanguard of globalisation in opposition to protectionist tendencies (and Donald Trump); in terms of foreign aid—even though they differ in the way they are utilised, as well as what sectors and countries they target—China easily rivals the United States today; and the clear advancements in the field of technological development are also worth mentioning.

201 7

USA

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THE INTERNATIONALISATION OF THE YUAN Another important step in attaining the abovementioned global leadership role is the strengthening of China’s position in the global economy, including the steps toward the internationalisation of the yuan. In the past 70 years, the dollar has been the dominant global currency, making up two-thirds of the world’s currency reserves. The yuan may not yet rival this achievement, but important steps were taken toward wider international acceptance in 2016 when the International Monetary Fund decided to add it to its SDR basket, alongside the American dollar, the euro, the Japanese yen, and the pound sterling. Although the IMF’s most recent data from 2017 indicate that barely 1% of global currency reserves were in yuan, several estimates indicate that this figure is expected to grow in the future. Last summer, the European Central Bank exchanged USD 611 million worth of reserves to yuan bonds, the German Bundesbank announced at the beginning of the year that it is interested in keeping some of its reserves in yuan, and shortly thereafter it was revealed that the French central bank has had Chinese currency reserves for a while. As of today, these may still be dwarfed by the aforementioned institutions’ dollar reserves, but they clearly reflect China’s increasing importance in the global financial system. Meanwhile, developing countries considering decreasing their dependence on the U.S. have shown even greater interest in the new international reserve currency. THE NEW SILK ROAD As China’s economic growth slowed and the appropriate economic policy responses were implemented, the country’s global trade and Currency composition of foreing exchange reserves Swiss franc Chinese yuan

0.2% 1.1%

Australian dollar

1.8%

Canadian dol lar

Pound sterling

4.5%

Japanese y en

4.5%

Euro

20.4%

American dol lar

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63.5%

investment positions and strategies also changed. The new challenges necessitated new answers in foreign trade and foreign policy, with special regard to the fact that China had decided not to close its doors to solve the problems it was facing but to employ a unique combination of diplomacy, trade, and foreign investment, which will both expand and reinforce the country’s foreign relations network and increase its business opportunities, while also strengthening the legitimacy of the Party and Xi Jinping. Thus, this new direction, which Beijing has dubbed the Belt and Road Initiative (BRI), is a result of domestic, geopolitical, historical, and (world) trade factors. Even though the Initiative’s name emphasises its infrastructural aspect, its core elements actually include trade, investment, and financial relations, as well as cooperation in the fields of tourism and education. China’s motivations behind the BRI need little explanation, as it contributes to the expansion of the country’s political and economic sphere of interest, enables it to balance any—potentially hostile—regional integration, gives it a more advantageous strategic position via the alternative transportation routes, and even helps to eliminate the excess industrial capacity it has amassed in recent years. International reactions to the BRI have been rather mixed, but due precisely to China’s existing weight in world trade, even more critical countries are forced to take the Initiative into account when managing their foreign relations. PROSPECTS OF GROWTH According to the World Bank’s estimates, Chinese growth will decrease to 6.4% in 2018 and remain there for a few years. This is mostly in line with the expectations of the Chinese government, as the new long-term growth norm has been identified around 6-6.5%, which will likely prove feasible. One potential source of risk is the vulnerability of the financial sector, a protectionist wave from developed economies, as well as an aging population, which is expected to shrink the job market. However, the leaders of China have been well aware of these threats for years. Recently, several tax and financial reforms were introduced, the country has stood up for free

Estimated real GDP growth in the coming years (%) 2020

2019

2018 0

2 China

3 Japan

4 USA

Eurozone

A 6-6.5% growth is still twice the global average, and multiple times the size of the expected growth rate of developed countries— not to mention the Chinese contribution to the growth of the global economy, which in the period between 2017 and 2019 is expected to exceed 35%, compared to barely 18% by the US and a mere 8% by the Eurozone.

Global

OTHER 13.7%

EURO ZONE 7.9%

SOUTH

KOREA 2.6%

CANADA 2.6%

INDIA 8.6%

JAPAN 1.2% INDONESIA 2.5%

BRASIL 1.2%

MEXICO 1.2%

GREATBRITAIN 1.2%

USA 17.9%

TURKEY 1.2%

CHINA 35.2%

AUSTRALIA 2.6%

trade at all international fora, and has worked to increase imports in order to balance its trade relations. Meanwhile, with the abolition of the one-child policy and by supporting automation and robotisation, China is working to keep its industry competitive.

IRAN 1.8% RUSSIA 1.6%

World Bank estimates for global growth, measured in real GDP and expressed in percentages (2017–2019) BROAD STROKES

CHINA’S 40 YEARS OF REFORM AND OPENING-UP Dr Chen Xinguang

The year 2018 marks the 40 th anniversary of China’s reform and opening-up. The Shanghai Academy is honoured to give the Hungarian people a comprehensive introduction to the historical process of China’s reform and opening-up, and the great accomplishments it has achieved, so as to deepen the understanding about China, and promote friendship and communication between our peoples. Foreword Reform and opening-up, an abbreviation for “domestic reform and opening to the outside world,” is a policy set in place at the Third Plenary Session of the 11th Central Committee of the Communist Party of China (CPC) in December 1978. Domestic reform first saw light in the rural areas. In November 1978, a household contract responsibility system, in which remuneration was linked to output, was carried out in Xiaogang Village, Fengyang County, Anhui Province, unveiling the prelude to China’s reform and opening-up. On 15 July 1979, the State Council gave approval for Guangdong and Fujian to implement special policies and flexible measures in external economic activities. This was a historical step in reform and opening-up. Over the past four decades, the CPC has led the Chinese people in carrying out a great revolution of reform and opening-up, not only creating the most exciting event in human history but also realizing the great change of pace, from “keeping up with the time” to “leading the time.” Over the past 40 years, the Chinese people have blazed a “Socialist road with Chinese characteristics” by surmounting all obstacles persistently. With 40 years of reform and development, China has reshaped its economic 38

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and social landscape, achieved historic changes, and embarked on the path of rejuvenating the Chinese nation. Data shows that China’s GDP surged from RMB 364.5 billion in 1978 to RMB 82.7 trillion in 2017. In specific terms, primary industry saw an added value of RMB 6.5468 trillion, secondary industry gained RMB 33.4623 trillion, and tertiary industry rose RMB 42.7032 trillion. China presently ranks second in the world as for the aggregate economy. Now, under the leadership of China’s Communist Party, people of all ethnic groups of China follow the goals defined in the 19th Congress and stay true to the mission, holding the great banner of socialism with Chinese characteristics, building a moderately prosperous society in an all-round way, taking firm steps to forestall and defuse major risks, carrying out targeted poverty alleviation, preventing and controlling pollution, winning a great victory for socialism with Chinese characteristics in new areas, and untiringly fighting for great rejuvenation of the Chinese nation. I. Organised Discussion on Truth Criterion On 11 May 1978, “Practice is the Sole Criterion for Testing Truth” was published on the front page of the Guangming Daily, authored under the name of “a special commentator.” It was not an academic article on philosophy. The tremendous impact it had following its publication demonstrated that its enormous influence had gone beyond the academic and even the ideological realms and spread across the political, economic, cultural, and social fields. As an icebreaker, it marked the beginning of ideological emancipation in China. On the same day, Xinhua News Agency quoted the article; the next day, it was reprinted by

People’s Daily and PLA Daily. Hence an attack was launched against the “Two Whatevers,” which referred to the idea of “We will resolutely uphold whatever policy decisions Chairman Mao made, and unswervingly follow whatever instructions Chairman Mao gave,” giving rise to a nationwide debate about the criteria of truth. The discussion broke through the stifling bondage of the “Two Whatevers,” promoted an ideological emancipation movement across China and ideologically paved the road for the epochmaking Third Plenary Session of the 11th Central Committee of the CPC. It had an important and far-reaching influence on the history of the state and the Party. II. The Third Plenary Session of the 11th Central Committee of the CPC The Third Plenary Session of the 11th Central Committee of the CPC was convened from 18 to 22 December 1978. It was a great turning point in the history of the CPC, with a farreaching significance. This significance is mainly embodied in the following three aspects: Firstly, the Third Plenary Session of the 11th Central Committee of the CPC continued with the past and opened up the future. It re-established the Marxist ideological line of seeking truth from facts and made a determination to shift the focus of the whole party’s work to socialist modernisation. Secondly, the Third Plenary Session of the 11th Central Committee of CPC was a meeting that opened up the future. The plenary session made it clear that the historical mission of the Party in the new period is to turn China into a modern socialist powerhouse, opening the prelude to the socialist reform and opening-up. The Chinese people entered a new era of reform, opening-up, and socialist modernisation. Finally, the Third Plenary Session of the 11th Central Committee of the CPC made reform, opening-up, and the economy its central focus, realizing historic shifts. The Third Plenary Session of the 11th Central Committee of the CPC held in December 1978 unveiled the prelude to China’s reform and opening-up, and China began to embark on the road of reform and opening-up following the session. From then on, the Chinese people

Deng Xiaoping

have advanced from one victory to another along this road, making remarkable achievements in socialist construction. III. Reforming the Rigid Planned Economy Model Planned economy was the adopted economic model of the former Soviet Union. For a long time, China had pursued a planned economy. There were times when it was considered one of the striking symbols of the socialist public economy. It contributed substantially to economic recovery and primary development in the 1950s. However, as time went by, its drawbacks BROAD STROKES

became increasingly apparent and heavily impeded China’s economic development in the following respects: First of all, it caused a highly monopolistic control of the domestic economy. The laws of value and the regulatory function of the market were neglected, which constrained the development of the commodity economy and inhibited the development of commerce and the economy. It was, at that time, considered as the biggest bottleneck for China’s economic growth. Secondly, production was planned in terms of both item and quantity. From man-made satellites to sewing needles, everything was included in the country’s mandatory production plan. Most of the production of goods was limited, and coupons were required to purchase commodities (for example, the purchase of food required a corresponding food stamp). This made it difficult for consumers to buy the necessary products, even if they had money. Thirdly, compulsory public ownership of the means of production was applied to industrial and agricultural production and commodity management. Private possessions were deemed illegal and all the fruits of labour had to be shared equally with others. This practice led to producers losing interest in expanding production and largely having no incentive to work hard. The economy soon became enfeebled. IV. Great Historic Achievement Earned in Internal Reform Within 40 Years All the elderly Chinese people have a special affection for the Story of Spring, a song that was once popular across China. Just as it says in the song, “In the spring of 1979, an old man drew a circle by the South China Sea. After that, cities sprang up like mushrooms, and wealth piled up magically. The spring thunder awakened the vastness both beyond and within the Great Wall, and the sunshine in Spring warmed both sides of the Yangtze River…” The old man mentioned in the lyrics was Comrade Deng Xiaoping, the chief architect of China’s reform and opening-up. Great historic achievements in the internal reform earned over 40 years are mainly embodied in five aspects as follows: 1. Regarding the political construction, 40

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the major achievements include the improvement of the People’s Congress system, the improvement of the system of multiparty cooperation and political consultation under the leadership of the CPC, and the improvement of the autonomy system at the grass-roots level. In December 2014, the Chinese Communist Party put forward a strategic blueprint titled the “Four Comprehensives” (comprehensively building a moderately prosperous society, comprehensively deepening reform, comprehensively implementing the rule of law, and comprehensively strengthening Party discipline). 2. With regard to the economic construction, China has achieved sustainable development by carrying out the new development concept of “innovation, coordination, greenness, openness, and sharing” and adhering to the ”Five News” (new industrialisation, new urbanisation, new informatisation, new agricultural modernisation, and new “greenisation”). In 2017, China’s GDP ranked second in the world only surpassed by the United States, with the share of the global GDP rising from 2.2% in 1976 to 14.8% in 2017, and the per capita GDP hitting USD 8,123.18 (current price). 3. From the aspect of cultural construction, China ranked second in the world in 2017, with a society-wide R&D expenditure of RMB 1.76 trillion and came 17th by innovation capability. China presently has 2,880 schools of higher learning, accounting for 20% of the world’s total and becoming the biggest country of higher education. China has set up 525 Confucius Institutes and 1,113 Confucius Classrooms in 146 countries and regions all over the world, with a total of 9.16 million learners of all kinds. In 2016, China saw 443,000 overseas students from 205 countries and regions, becoming the biggest destination of overseas education in Asia and the third biggest destination of overseas education in the world by this. 4. Regarding social construction, the income level of both urban and rural residents has risen significantly. The per capita disposable incomes of urban residents and rural residents increased from RMB 343.4 and RMB 136.6 in 1978 to RMB 36,396 and RMB 13,432 in 2017, respectively. Meanwhile, China has basically

completed the shift from a rural society to an urban society, with the urbanisation rate being 57.4%. Since the reform and opening-up, the poverty-stricken population in China sharply declined from 250 million in 1978 to 30.46 million in 2017, and the poverty rate fell from 30.7% to 3.1%, with 63.58 million lifted out of poverty in the recent five years. 5. Concerning ecological development, as of 2016, China’s forest area covered 258 million hectares, with the forest coverage rate reaching 21.93%. Since 2012, China has seen more than 6 million hectares of newly increased afforestation area annually, and 118 cities have become “national forest cities.” V. Building a Community of Shared Future for Mankind Through Opening-up China puts forward the Belt and Road Initiative (BRI) with Chinese wisdom to build a community of shared future for mankind. In January 2017, China put forward the major international initiative of “building a community of shared future for mankind.” In February, at the 55th session of the United Nations Commission for Social Development, the concept of “building a community of shared future for mankind” was first written into the UN resolution, receiving high general appraisal and an extensive attention from the international community. The specific aim of the initiative is to promote the building of “Five Worlds” (namely, a world of lasting peace, a world of universal security, a world of common prosperity, a world of openness and inclusiveness, and a world of cleanness and beauty). This is both an extension of China’s “Five-in-one” general layout to international levels (i.e. the previously mentioned political, economic, cultural, social and ecological construction – Ed.) and also in line with the trend of human development and progress. In September 2013, the One Belt, One Road initiative put forward by China is also known as the “Silk Road Economic Belt” and “21st-century Maritime Silk Road.” The Belt and Road Initiative may not only help address many major problems the international community needs to face today but also provides a solid fulcrum for the building of a “community of

shared future for mankind, while demonstrating the ideological and operational capability of China as an oriental power. The BRI advocates the Silk Road spirit of “peaceful cooperation, openness and inclusiveness, mutual learning, and mutual benefit, and win-win cooperation,” and points to a new direction for globalisation, which will certainly result in a bright future. Over the past four years, the Belt and Road Initiative has become a grand plan concerning 4.4 billion people, the two-thirds of the world’s energy supply and 40% of the world’s GDP. The Initiative aims to rebuild a new land-sea Silk Road connecting Asia and Europe and to establish unobstructed cargo transport between the East and the West. Starting from scratch and evolving step by step, the BRI boosts pragmatic cooperation in such key areas as policy communication, facility connectivity, unimpeded trade, financial integration, and people-to-people bonds. Moreover, it promotes the prosperity and development of all the countries along the “Belt and Road.” Furthermore, it has also created new opportunities for 65 countries along these economic corridors and helped achieving economic growth on a global scale. In 2017, China’s import from and export to the countries along the BRI reached RMB 7.37 trillion, a 17.8% increase on an annual basis, with 3.6 percentage points higher than China’s overall foreign trade growth rate. It accounted for 26.5% of China’s total foreign trade value, with the export being RMB 4.3 trillion, up 12.1% and the import being RMB 3.07 trillion, up 26.8%. As of May 2017, the Asian Infrastructure Investment Bank advocated by China has provided loans of USD 1.7 billion for nine projects. The Silk Road Fund, funded by China, has signed agreements for 15 projects and has pledged a total investment of about USD 6 billion.

Note: All data used in this article are officially released by the National Bureau of Statistics of the PRC, and some are available on the website of the National Bureau of Statistics. BROAD STROKES

THE BELT AND ROAD INITIATIVE—THE DAWN OF A NEW INTERNATIONAL ORDER? Viktor Eszterhai

The Belt and Road (or the Silk Road Economic Belt and the 21st-century Maritime Silk Road) Initiative was announced by the President of the People’s Republic of China, Xi Jinping, in September 2013 in Kazakhstan. In recent years, the proposal has received considerable attention not only in political circles but also from experts of international relations and laymen as well. In itself, the Initiative is of historical significance, as it shows that, in a sharp turn, China—for a long time a rule-abiding entity in international politics—has begun harboring ambitions of becoming a rule-setter. DEFINITION: A NEW INTERCONTINENTAL NETWORK Despite the considerable international attention, accurately defining the Belt and Road Initiative (BRI) remains a challenge. It is perhaps best described as a draft proposal aimed at redefining the relationship network between Europe, Asia, and Africa. It is an initiative, not a plan or a program, as there exists no roadmap and no clearly defined phases for its implementation. The obvious analogy for the BRI is the Silk Road from the Antique Period, once the world’s most extensive trade network, which, before the age of great geographical discoveries, connected the most important centers of civilisation and trade in Asia, Europe, and Africa, as the axis of the world economy on land and sea alike. Like the ancient Silk Road, the BRI explicitly aims to foster, beyond its economic function, the exchange of information, knowledge, ideas, ideologies, currents of art, technology, etc. Thus, the initiative strives to connect regions which may be geographically contiguous but, due to a sea-centric 42

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world economy, have only had limited interactions. This does not mean a complete abandoning of the seas, however, as exemplified by the fact that the 21st-century Maritime Silk Road is a core part of the program, even though the strengthening and extension of land-based connections clearly play an outstanding role in the proposal. It follows from the above that the core principle of the BRI is relationships and connectivity, of which official state documents highlight five means. First is political coordination, which entails the harmonisation of the policies of certain national, regional, and international institutions. Second is the development of physical infrastructure, which means creating new and connecting existing public roads, railways, oil and gas pipelines, as well as optical networks, complemented by industrial parks, logistical centers, and seaports, all working in tandem, thereby rewriting the traditional economic relations between this massive region’s centers of production, markets, and raw material sources. Third is guaranteeing unimpeded trade, the first step of which means the reduction of bureaucratic obstacles of trade, but in the long run also entails the broadening of free trade areas. The fourth element is financial integration, the aim of which is the harmonisation and mutual regulation of financial services, and the exchange of currencies within the affected region. Finally, the fifth method is the strengthening of the connections within the human sphere, which puts great emphasis on cooperation in the fields of culture, as well as research and development, providing scholarships and exchange programs for students, experts, researchers, thereby promoting, among others, tourism.

Chinese goods in Belarus, en route to European markets

Thanks to this renewal of relations, the BRI should be understood primarily as a network, leaving plenty of room for spatial expansion and involving state, economic, and institutional actors, as well as cities, private citizens, NGOs, etc. Once this definition is clear, we immediately have answers to two questions, which are often asked the wrong way. One is “Where does the ‘New Silk Road’ lead?” In light of the above, we are clearly not dealing with a road, but a network which takes a variety of shapes. The other frequently asked question is “When will it be ready?” The problem with this is that, since the network is expandable in a flexible manner, it can never be deemed complete spatially and temporally. Of course, the existing and planned physical infrastructural network has more important channels and nodes, which are concentrated in the so-called main economic corridors. The six land corridors are the China–Mongolia– Russia Corridor, the New Eurasian Land Bridge, the China–Central Asia–West Asia Corridor, the China–Pakistan Economic Corridor, the Bangladesh–China–India–Myanmar Economic Corridor, and the China–Indochina Peninsula Corridor. The amount for goods transported through the first two has grown significantly over the past years, the basis for which was created by connecting the Chinese and former Soviet rail networks. Today, the fastest rail connection between China and the European Union (Urumqi– Duisburg) is 10 days. The most visible work on an economic corridor is currently taking place on the China–Pakistan one, thanks to a Chinese investment amounting to nearly USD 60 billion.

CHINA’S INTERESTS An initiative of such magnitude can only be considered relevant if it is founded on clearly defined goals by China, since the main aim of the new Chinese foreign policy—just like with other great powers—is the promotion of the country’s interests on the global stage. We can identify several goals behind the Belt and Road. First, there is an important effort by China to diversify its energy and raw material transportation routes. In recent decades, the country’s dynamic economic growth has necessitated the importing of increasing amounts of raw material, most of which arrive via sea routes. Oil stands out as one of the most crucial imported goods, with 70-80% coming through the Strait of Malacca, and the South China Sea, the object of a territorial dispute, representing a great strategic vulnerability for China. As a result, the government is working to establish an infrastructure covering multiple regions and transport routes within the framework of the BRI. The second important aspect to be kept in mind with regard to the Initiative’s implementation is that, with the expansion of the network of relations, China will acquire new markets, while mainly relying on the rapidly growing middle classes of Asian and African markets. Third, the projects to be carried out within the BRI framework represent an excellent investment opportunity for China. In recent decades, the export-centric economic model has led to a massive trade surplus in China (USD 3.200 billion), which the country has predominantly used to purchase low-interest American government bonds. The BRI is an opportunity for the Chinese BROAD STROKES

state to diversify its investments and put its money into projects offering greater returns. Fourth, as a result of the decrease in foreign import in the wake of the 2008 financial crisis, the only way to maintain China’s economic growth was to introduce a sweeping stimulus package, which, albeit successful, ended up generating excessive capacities for companies involved in infrastructural development and real estate. Even though the government cannot fully avoid cutting these capacities—a move sure to be negatively felt by society—the BRI will allow China to move at least some of them abroad. This will simultaneously help Chinese companies gain strength and a foothold abroad, which is in line with a previously announced aim of the Chinese government (the so-called Go Out strategy). Fifth, the BRI supports the structural reconfiguration of China’s economy, a key element of which is to have the industrial sector produce more value-added goods. Due to the growing wages and increasingly stringent regulations, China is on the path toward innovation-driven, high-quality industrial production, in support of which the government has announced a “smart manufacturing program,” called “Made in China 2025,” a modernisation effort aimed at merging information technology and manufacturing. In order to ensure demand for these products, Europe as a market has an important role to play. Here, China has to compete with corporations of developed industrial countries, which means it is not enough to manufacture high-quality products: They also have to be transported to consumers quickly and in a cost-effective manner. In all of this, the infrastructural investments to be carried out within the BRI framework (mainly on railways) are indispensable. The sixth consideration is the boost that the BRI could give to the effort aimed at making the Chinese Renminbi (RMB) an international currency. The People’s Bank of China has been working with countries involved in the implementation of the BRI to sign currency swap agreements, which China hopes would lend additional weight to its money in trade between the affected parties. In the long run, China plans to have the states involved increasingly rely on the RMB as reserve currency. 44

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In addition, China is expected to also use the RMB (at least partially) to provide loans for its foreign infrastructural projects, thereby boosting the currency’s international profile. Of course, the BRI is also connected to certain domestic political goals. It represents a breakout opportunity for China’s western and central provinces—especially its centrally-located cities— which are typically less developed than the coastal regions. The Chinese government has concluded that the improving economic opportunities are also suitable for greatly alleviating certain social tensions and decreasing the danger posed by religious extremism, terrorism, and separatism (known in Chinese terminology as the “Three Evils”) in areas with minority populations. Finally, the BRI neatly fits into Xi Jinping’s Chinese Dream program and China’s two centenary goals (i.e. achieving a society of relative well-being by 2021, the 100th anniversary of the Communist Party of China, as well as establishing a prosperous and strong China by 2049, the 100th anniversary of the declaration of the People’s Republic), as the focus of both of these is the restoration of China’s former power and international role. GEOPOLITICS AND NEW INSTITUTIONS The Chinese government has forcefully rejected the suggestion that the BRI has geopolitical motivations and thus also considers any comparisons with the Marshall Plan misguided. One reason why China objects to parallels with the latter is the claim that they do not intend to export their own economic, political, and ideological model, which stands in contrasts to the U.S.’s post-World War II activities. In reality, by realizing the BRI network across three continents based on the “five connectivities,” China—along with the other countries involved—is laying down the foundation of a new international order. The deepening integration of Asia, Europe, and Africa could change the geopolitical foundation of our globalised world’s organisational structure, which the Western great powers originally established via the control of maritime trade and maritime trade routes in the wake of 16th century colonisation. However, China is leaving its mark on the current international order with more than just the creation of a new network: It is also filling the

The most important land and maritime strategic projects of the Belt and Road Initiative

BRI framework with its own institutions. These include transregional institutions which help put China’s relations with the various regions on new foundations, such as the Forum on China– Africa Cooperation, the “16+1” Cooperation, or the Asian Infrastructure Investment Bank, a new financial institution, which has attracted considerable attention. That the BRI is officially open to every country does not mean that there are no parties who are interested in seeing it fail. The biggest opponent of the changes is the United States, which sees the Initiative as a threat to its former hegemonic power. Meanwhile, Japan and India see the Chinese plan as the basis for a new Asian order led by China, which, as such, is unacceptable to them. In particular, India has criticised the strategic relevance of the China–Pakistan Economic Corridor and China’s increasing influence on the Indian Ocean (a key element of the 21st-century Silk Road). Finally, the European Union’s stance also seems unclear, but without it, there can be no reset in Eurasian relations. Despite these critical voices, however, the BRI also represents a serious opportunity: investment options for the American and Japanese financial spheres, a potential way

of satisfying India’s infrastructural needs, and the modernisation of the EU’s Eastern relations. The BRI has a good number of proponents too, mainly among developing countries, for whom the Initiative holds the promise of a modernised infrastructure, as well as investment and trade opportunities, all of which they badly need but cannot attain from the current international order and its institutions. In recent years, over 60 states have expressed their willingness to participate in the BRI. The degree of interest is shown by the success of the Belt and Road Forum, held in May 2017 in Beijing, which hosted a total of 130 states (including 29 heads of state) and 70 international institutions. The Belt and Road is thus an overarching vision affecting every country and large institution of the world, inevitably reconfiguring international relations. It is clearly a result of China’s mid- and long-term interest, and thus it is more than just an idea that is bound to quickly end up at the bottom of a drawer. However, it can only succeed if it can incorporate the plans of other countries, not just China.

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THE STABILIZING ROLE OF THE BELT AND ROAD INITIATIVE IN EURASIA Zsolt Csepregi

Never in the history of mankind have we lived in such a peaceful and secure era than the first two decades of the 21st century. The rate of violent death shows a trend of a constant decrease. While the prehistoric man had a 10-20% chance, depending on the culture he lived in, to die by the hand of another human being, this ratio reduced to 2-5% in medieval times, and currently it stands at a few per mills. It is difficult to present these scientific facts to the public while we hear about the violent events occurring in the Middle East or while we try to estimate the future of the global world order, considering the erratic power structure of the international scene. The inner lands and the south-western region of

The ancient Silk Road linking India and China 46

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Eurasia suffer from internal or internationalised internal conflicts stemming from environmental, economic, and societal challenges, which provoke most of the armed conflicts in the world. The root of the problem is also the key to its solution. By the laws of geopolitics, the regions which serve as “geopolitical frontiers” suffer the most from conflicts, due to their particular geographic location. The burden of a location may also be a blessing. Nothing proves this more than those prosperous countries which rose alongside the historic Silk Road, utilising transcontinental trade. The Middle East and Central Asia make the heart of the Eurasian supercontinent, which experienced both the “blessing” presented by trade and the

“curse” presented by the Hellenic and Muslim conquest or Western and Soviet imperialists. The greatest challenge of the future and the Belt and Road Initiative is whether these economic regions integrated by the initiative can strengthen their security. The initiative is doomed to fail if the countries located in the heart of Eurasia will not be able to join globalisation in a sustainable manner. According to the international relations theory, growing economic interdependence between states bases their relationship on new grounds. The Belt and Road Initiative, through its infrastructural network spanning Eurasia, strengthens the beneficial interdependency on multi- and bilateral levels in auspicious circumstances in each state as well. The challenge arises from the fact that Eurasia has never existed as an undivided economic area. The historic Silk Road provided land-based interconnectivity between the production base in the Far East and European consumers, but trade meant primarily the flow of luxury goods from the East to the West, while precious metals made their way to China in return, as the Middle Kingdom did not need European goods. Expanding the geographic notion of the Silk Road, the advantage of the Belt and Road is that it truly creates a network between the two edges of Eurasia. The nature of the two edges is key, as the European Union, as a single economic unit, surpasses even the United States in terms of GDP, although its growth slowed down after the economic crisis. On the other hand, the rich and emerging powers of East and Southeast Asia will serve as the economic engines of the future. However, no other political and economic entity resembling the European Union exists on the globe, the People’s Republic of China, Japan, and the Republic of Korea make a highly interdependent economic unit. That eases political tensions among them, though their economic relations are still vulnerable to political conflicts. Robust trade relations certainly exist between the two edges of Eurasia, but the stabilizing effect of the Belt and Road Initiative stems from creating effective land-based connectivity networks besides the dominant maritime routes. The new and the more effective trade routes will not only provide great economic opportunities for

European and Far Eastern states but also for the landlocked countries located in Inner Eurasia. Chinese consumption is growing even faster than the country’s GDP, at a rate between 8-10% annually, projecting that the Chinese demand will reach European and American levels and even surpass them. This would open new opportunities for conflict-ridden regions in Eurasia, which could guarantee the resolution of social tensions through economic interdependence and prosperity. Infrastructural connectivity is only the first step towards a greater economic wealth. Besides transportation routes, stability also depends on the well-being of the local population, which presumes that countries and inhabitants along the Belt and Road Initiative can join the trade of goods and services. Even though globalisation has not left Central Asia and the Middle East unaffected, large portions of the local societies has not benefited from the process. Through the channels of mass communication, these populations have gradually become aware of the unimaginably high living standards Europe and the Far East largely enjoy. Furthermore, the negative effects of globalisation, such as extreme

The Khunerjab pass on the border of China and Pakistan BROAD STROKES

ideologies, arms and drug trafficking, and cultural products often unacceptable in conservative societies, have easily entered the life of the poor and fragile countries. The dubious nature of globalisation provides the context for the relations promoted by the Chinese government through the Belt and Road Initiative, based on mutual benefits or, in other terms, win-win relations. At first glance, this idea, which we might know from game theory as non-zero-sum game, might seem strange for the Western audience. From another point of view, it can be understood as avoiding the exploitation of the partners, which might help us grasp the security aspect better. In the age of European imperialism in Africa, a key element of exploitation was the building of transportation networks, which only served the resource extraction aims of the colonial powers. The African states wanted to oppose this relationship, as it did not serve their interest. The Belt and Road Initiative has to avoid such a situation; it can only be successful if the involved communities will not perceive the realisation of the investments as a dictate. If these conditions were not fulfilled, the Chinese and the international investors would both lose, which illustrates the nature of mutually beneficial relations. Discontent of populations in Eurasia can indeed block deepening economic integration. In the 21st century, the nature of states and armed non-state actors are undergoing a radical transformation. State military budgets are focusing on maintaining small, professional, and technologically intensive armed forces, but poor non-state actors can only utilise traditional military and guerrilla warfare strategies. This gap is well portrayed by the Far Eastern arms race, where the emphasis is put on acquiring submarines, carriers, destroyers, and advanced missile defence systems, but most killings are still committed by weapons that are on the technological level of the early Cold War era. This difference means that in naval and aerial warfare and in long range power projection, developed states have a serious advantage, whereas on land, failed states and militant non-state actors operating in them still present a significant challenge. Regions without strong state 48

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monopoly on violenceâ&#x20AC;&#x201D;such as the battlespace in Syria and Iraq or tribal regions in Afghanistan and Pakistanâ&#x20AC;&#x201D;are all victims of armed groups that are able to keep millions of people at bay with small arms. From the perspective of the Belt and Road Initiative, these groups represent a great challenge, since unlike maritime routes, which can be secured through advanced weapons systems, on land, guerrilla forces have a relative

Freight train in the Tian Shan Mountains

advantage, as they are able to easily disrupt transportation networks. According to the laws of the market, a transportation route which often becomes a target of armed attacks forces the market actors to find alternative routes for their goods. In the end, the population of the instable regions have to bear most of the damage, if the interior regions of Eurasia will still not be able to reap the benefits of the intensifying global trade,

and as such, they will stay on the losing side of globalisation and eventually become its obstacle. Securing transportation infrastructure has only two methods: state-building or direct troop deployment in cooperation with the host country. In Pakistan, China aims to secure the Chinaâ&#x20AC;&#x201C;Pakistan Economic Corridor through direct military deployment. This corridor is of primal importance for China, as it serves

to bring Inner Chinese goods to the world market in a merchantable manner. Apart from Afghanistan, this region along the corridor is the most dangerous one, as it passes through tribal territories under nominal state control. For this reason, China aims to secure the transportation route in cooperation with the Pakistani government and armed forces, but this cannot be a sustainable model for the

Belt and Road Initiative. The Pakistani armed forces, apart from not being able to impose significant governmental control over large swaths of the country, are numerous and strong, as the tensions with India since 1947 forces them to be. Even though China has a local partner in this country to guarantee the security of the route, the infrastructural investments would only repay their price after decades of stable usage, whereas stability in Pakistan cannot be taken for granted. Military threats posed on transportation routes off the Belt and Road Initiative would only truly disappear if the participant countries were able to utilise successful globalizing economic trends to create strong states. None of the countries have sufficient military potential to secure the instable regions of Eurasia and negate security risks along transportation routes through peacekeeping missions. While, because of the technology-intensive nature of the battlespace, a few well-placed naval bases can secure a route for maritime transportation, on land, this would be impossible. The advantage of the envisioned high-speed railways is that they would not stop unnecessarily at intermediary stations. However, this induces pointbased development, from which only a handful of major cities and industrial centres benefit. The key question of the oncoming decades is how supply chain networks can create value so that large sectors of the societies can reap their advantages. This challenge is not limited to instable regions, but while in Western Europe and more and more in the Far East, we can envision taxation systems which guarantee some income to underemployed sections of the societies too, this possibility is currently unimaginable in Central Asia. All the above is not intended to claim that the Belt and Road Initiative alone will solve the problems of the fragile states of Eurasia. The economic opportunities and institutional development stemming from the initiativeâ&#x20AC;&#x2122;s implementation coupled with the knowledge transfer of outstanding Chinese experience in state-building through training governmental officials of partner countries can all help vulnerable states become the winners of globalisation, fostering peace and stability home and abroad. BROAD STROKES

THE 21ST-CENTURY MARITIME SILK ROAD Zsolt Csepregi

In the Age of Exploration, the majority of world trade between Europe and its colonies in the New World and Africa was conducted on the Atlantic Ocean. After the rise of the United States as a superpower, the Pacific Ocean was also used for the global trade of goods at an increasing level. In the 21st century, thanks to the rapid economic growth of the Far Eastern, South Asian, and East African countries, the maritime routes of the Indian Ocean will become the most vital arteries of global trade once again. The 21st-century Maritime Silk Road, also referred to as the “String of Pearls” concept, being realised under the umbrella of the Belt and Road Initiative, aims to develop the Indian Ocean Basin in order to handle the greater wave of goods. The strategy followed by the People’s Republic of China is based on four pillars: capacity development, access, profit, and security. Maritime transportation, even if slower than its land-based counterpart, is much more cost-efficient, as nowadays container ships up to 400 metres in length are cruising the oceans carrying loads of goods. It is an intriguing fact that the largest ships in the world are built by the companies of the Republic of Korea, such as Samsung and Daewoo, but Chinese firms are already at the second place and catching up rapidly. These ships, able to carry almost 200,000 tons of goods, can only be served by specially built ports. Chinese efforts are focused mainly on this aspect at the sites of the gigantic investments. The previously mentioned “String of Pearls” image fits these selected ports: starting from China’s shores, five strategically located ports were selected for development, apart from the investments proposed in Malaysia and Indonesia. The following ports were selected as the “pearls”: the Kyaukpyu Port in Myanmar, the Hambantota Port on the Southern tip of the Sri Lankan archipelago, Gwadar at the Indian Ocean exit of the China–Pakistan Economic Corridor, while the trade with Africa will be conducted through Bagamoyo in Tanzania and the Port of Piraeus

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Shanghai—the world’s busiest container port

in Greece. Capacity development and strategic location do not guarantee financial profit, a factor which is also taken into consideration by China. Chinese operating companies with great expertise are getting an increasing share in the ports selected for development, while the parallel creation of special economic zones also support the profitability of the “String of Pearls,” the latter of which was a key element in the economic success of the reform and opening-up in China after 1978. Finally, some thoughts on security, which may be approached from two angles: security of supply and the military dimension. The selected ports in Pakistan and Myanmar, since they are located in neighbouring countries and have friendly relations with China, can serve as alternative access routes to the ports of Southeast China. Regarding the military ambitions of China, the 21st-century Maritime Silk Road is not primarily relevant, despite what the critics say. A few trading ports which can serve container ships do not substitute for the building of a blue water navy and the long decades of preparation for the troops, so that China may become a great naval power. The often quoted naval base in Djibouti might be effective to clamp down on pirates menacing the Horn of Africa and could serve to protect and supply Chinese peacekeeping missions in its vicinity; however, these are rather the initial steps of an emerging great power in taking a global role than a threat factor. The 21st-century Maritime Silk Road is a solid economic plan, which strengthens China’s economic stability and aids its access to Eurasian and African markets. This proves that while globalisation is marching ahead, China is not afraid to start adopting the role of a mature great power.

THE THRIVING CHINA–CEEC COOPERATION Dr Chen Xin The first China and Central and Eastern European (CEE) Countries Economic and Trade Forum was held in Budapest in 2011. It opened the curtain for the cooperation between China and CEE countries. In 2012, Wen Jiabao, Chinese Primer Minister of the time, had a meeting with the leaders of 16 Central and Eastern European countries in Warsaw and agreed to launch the China–CEEC Cooperation (“16+1” Cooperation). In November 2017, Budapest hosted the 6 th China and Central and Eastern European Leaders’ Meeting and the 7th China and CEE Countries Economic and Trade Forum. The purpose of the meeting was to deepen the economic, trade, and financial cooperation and to promote mutual benefit and win-win development. Budapest can be a new starting point for the cooperation between China and Central and Eastern Europe.

I. The Outcome of the Cooperation The China–CEE cooperation has achieved fruitful progress in the fields of politics, economy and trade, transportation and logistics, infrastructure, as well as people-to-people exchanges. I.1. Strengthening the Political Cooperation Before 2011, China had two strategic partners in Central and Eastern Europe, namely Serbia and Poland. In the process of the cooperation between China and the countries of Central and Eastern Europe, the Czech Republic became China’s strategic partner in 2016, and Hungary signed a comprehensive strategic partnership agreement with China in 2017. China’s relations with Serbia and Poland have also been promoted to this level of partnership.

The 2016 Riga Summit between China and the CEEC BROAD STROKES

China’s trade with CEE countries between 2011 and 2017, in million USD

Country

2011

2017

Volume

Export

Import

Slovakia

5,969

2,512

3,457

5,315

2,730

2,585

-11%

-25%

Slovenia

1,878

1,676

202

3,383

2,888

495

80%

72%

145%

Latvia

1,256

1,193

1,325

1,148

177

-4%

181%

Lithuania

1,423

1,335

1,856

1,601

255

30%

20%

190%

Estonia

1,336

1,131

205

1,267

1,007

260

-5%

-11%

27%

Poland

12,989

10,941

2,048

21,219

17,876

3,353

63%

64%

9,988

7,669

2,319

12,489

8,793

3,696

25%

15%

59%

Czech Rep.

Volume

Export

Changes 2011–2017, % Import

Volume

Export

Import

Hungary

9,259

6,807

2,452

10,127

6,050

4,077

-11%

66%

Romania

4,402

3,454

948

5,602

3,778

1,824

27%

92%

Bulgaria

1,466

1,005

461

2,137

1,169

968

46%

16%

110%

Croatia

1,621

1,541

1,343

1,160

183

-17%

-25%

129%

Serbia

475

396

757

546

211

59%

38%

167%

Albania

438

282

156

650

454

196

48%

61%

26%

BosniaHerzegovina

136

92%

93%

90%

Montenegro

102

199

133

95%

48%

450%

Macedonia

247

155

165

-33%

-15%

-44%

52,920

40,165

12,755

67,970

49,490

18,490

28%

23%

45%

Total

To enhance mutual understanding and strengthen bilateral cooperation, China maintains intensive political communication with CEE countries, holds annual meetings with the leaders of these states, and established a platform for the cooperation of local governments. All 16 countries have signed a memorandum of understanding with China on the Belt and Road Initiative. I.2. Significant Increase in Trade China’s trade volume with CEE countries grew by 28% between 2011 and 2017, with a 23% hike in exports and a 45% increase in imports. At the same time, China’s overall trade with the 28 EU countries only grew by 8.5%, while its imports increased by 15.9%. For comparison: China’s global trade grew by 12.7%, and its imports increased by 5.6% within the same period. The trade between China and CEE countries has been greatly improved, particularly regarding the import from the region. 52

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On country level, the Polish trade volume rose the most significantly, from USD 13 billion in 2011 to USD 21.2 billion in 2017. Poland’s share of the China–CEE trade rose from 25% to 31%, ranking first among the 16 countries by this. The biggest import growth in China was from Hungary, increasing from USD 2.5 billion in 2011 to USD 4.1 billion in 2017, which was the 22% of China’s overall imports from Central and Eastern European countries. Data shows that China’s trade volume growth is the largest with Montenegro (95%), Bosnia and Herzegovina (92%), and Slovenia (80%). Imports form CEE countries increased most significantly in case of Montenegro (450%), Lithuania (190%), Latvia (181%), and Serbia (167%). The initial base of trade between these countries and China was relatively small, but it developed with rapid momentum. At the same time, we must also see a decline in the volume of trade between China and the countries of Macedonia, Croatia, Slovakia,

and Estonia. There were only two CEE countries, Slovakia and Macedonia, from where imports have fallen. This is mainly due to the drop in the demand for Touareg cars produced by the German Volkswagen, exported by Slovakia and the drop in the export of Macedonian primary products to China. The import from Estonia and Croatia has increased by 27% and 129% respectively. I.3. Increasing Investment Between 2011 and 2016, China’s FDI stock in CEE countries increased from USD 1 billion to USD 1.7 billion, reaching nearly USD 2 billion in 2015. The largest stock growth was achieved in Romania (USD 266 million), the Czech Republic (USD 161 million), and Poland (USD 120 million). China had the largest FDI stock in Hungary among the CEE countries, peaking at USD 571 million in 2015, after which it dropped to USD 314 million in the next year, still ranking second with that. Poland takes the lead with USD 321 million, and the Czech Republic follows Hungary as the third

with USD 228 million. Bulgaria was ranked third in 2015 with an FDI stock of USD 236 million, but it has fallen back to the fourth place with USD 166 million in 2016. From the perspective of investment flows, the highest foreign direct investment (FDI) was received by Hungary in 2016 with USD 57 million, followed by Serbia (USD 31 million), and Slovenia being third (USD 22 million). China’s investment in Romania and Bulgaria also reached USD 63 million and USD 59 million in 2015. I. 4. Transportation Development The China–Europe Railway Express now reaches 8 cities in 4 CEE countries; thus it provides an alternative logistic route and motivates the export of goods from CEE countries to China, especially that of agricultural products. Six new airline routes have been launched by Chinese airline companies between China and CEE countries since 2015, namely Beijing– Budapest, Beijing–Warsaw, Beijing–Prague,

China’s FDI in CEE countries in stock, million USD

2011

2012

2013

2014

2015

2016

Hungary

475.35

507.41

532.35

556.35

571.11

313.70

Poland

201.26

208.11

257.04

329.35

352.11

321.32

Czech Rep.

66.83

202.45

204.68

242.69

224.31

227.77

Slovakia

25.78

86.01

82.77

127.79

82.77

Slovenia

5.00

26.86

Romania

125.83

161.09

145.13

191.37

364.80

391.50

Bulgaria

72.56

126.74

149.85

170.27

235.97

166.07

Estonia

7.50

3.50

Latvia

0.54

0.94

Lithuania

3.93

6.97

12.48

15.29

Croatia

8.18

8.63

8.31

11.87

11.82

11.99

Albania

4.33

7.03

6.95

7.27

Bosnia-Herzegovina

6.01

6.07

6.13

7.75

8.60

Montenegro

0.32

4.43

Macedonia

0.20

0.26

2.09

2.11

2.10

Serbia

5.05

6.47

18.54

29.71

49.79

82.68

1008.67

1333.90

1435.76

1696.51

1976.75

1666.79

Total

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China’s FDI in CEE countries in flow, million USD

2011

2012

2013

2014

2015

2016

Hungary

11.61

41.40

25.67

34.02

23.20

57.46

Poland

48.66

7.50

18.34

44.17

25.10

-24.11

Czech Rep.

8.84

18.02

17.84

2.46

-17.41

1.85

Slovakia

5.94

2.19

0.33

45.66

Slovenia

21.86

Romania

0.30

25.41

2.17

42.25

63.32

15.88

Bulgaria

53.90

54.17

20.69

0.42

59.16

-15.03

Estonia

Latvia

0.45

Lithuania

1.00

5.51

2.25

Croatia

0.05

3.55

0.22

Albania

0.56

0.01

0.04

0.06

1.62

0.85

Bosnia-Herzegovina Montenegro

Macedonia

0.06 -

Serbia

0.21

2.10

Shanghai– Prague, Chengdu– Prague, and Beijing–Prague–Belgrade. New airline routes have effectively promoted tourism and facilitated business and investment. I.5. Increasingly Active People-to-people Exchanges As the number of Chinese tourists has been generally increasing in Europe, all the 16 CEE countries have also become frequented destinations by Chinese tourists in the recent years. In the last five years, the number of Chinese visitors in Central and Eastern European countries has reached 930,000, starting from 280,000. Student exchanges are also active. Last year, the Chinese government announced to grant scholarships to 5,000 students from CEE countries to study in China. Some CEE countries have also established scholarships for Chinese students. There are 29 Confucius Institutes in the 16 CEE countries, where 38,000 students study Chinese.

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11.50

11.69

-1.00

7.63

30.79

II. Sources of Vitality The key to the fast development of the “16+1” Cooperation lies in the commitment to the principles of equal consultation, mutual benefit, openness and inclusiveness, resultorientedness and innovativeness. Equal consultation means that the countries are equal actors of the cooperation and the related consultations regardless of size. The China–CEEC mechanism is based on mutual respect and equality. Everybody can join the discussion and should be encouraged to strive to maximise consensus, minimise differences, and optimise the roles of all parties. By mutual benefit, we mean that the partner governments mutually promote the cooperation, and the private enterprises also take a major role in this and adjust their market activity accordingly. If they follow international conventions and rules, each party can play to its own comparative advantage and expand the “cake” of common interest by that. The principles of openness and inclusiveness mean that the countries mutually assist each other while adhering to the ideas of openness, fair play, and

transparency. It is also important for the countries to be open to new opportunities and to be able to cope with challenges and seek ways of common development in the cooperation. The China– CEEC cooperation aims to promote this by improving the common good. One of the pragmatic approaches of the China– CEEC cooperation is the various cooperation platforms opened with one or more countries. It stimulates the countries to initiate cooperation platforms based on their competences and strengths. More than 20 cooperation platforms have been established in the areas of economy and trade, agriculture, health care, tourism, higher education, infrastructure, maritime and inland navigation, culture, banking, energy, forestry, and logistics. An innovative approach like this can boost the activity of each country and strengthen their sense of ownership within the cooperation. The other pragmatic approach is planning and implementation. The guidelines have been thoroughly drawn by the 17 countries together after each leaders’ meeting. Each guideline contains new actions and continues the previous ones. This self-revision process makes the cooperation mechanism more effective. With the progress of the cooperation, the need emerged for mid-term planning so the leaders published the Suzhou Guidelines in 2015. A five-year plan, which would be in accordance with the China– CEE mechanism on a wider scale after the completion of the China–EU 2020 Cooperation Framework, is also under consideration. III. Budapest, a New Beginning After five years of cooperation, Budapest hosted the 6 th “16+1” Summit in November 2017. The results of the meeting project a common future with several areas worth focusing on. III.1. Financial Cooperation Finance plays a crucial role in enhancing the cooperation between China and the Central and Eastern European countries. At the launch of the cooperation in 2012, the Chinese government announced a USD 10 billion worth of credit facility for Central and Eastern European countries to

be used for project implementation in a loan system. Since then, the China–CEE Investment Cooperation Fund has raised USD 1 billion, and the credit facility was extended by another USD 1 billion in 2017. The Industrial and Commercial Bank of China (ICBC) initiated the China–CEE Fund in 2016, and the China– CEEC Interbank Association was established at the China–CEEC summit in Budapest in 2017. Furthermore, the Development Bank of China is now authorised to provide development loans up to an amount equivalent to EUR 2 billion. These investment funds and policy loans mean further encouragement for the enterprises in the region. III.2. Renminbi Internationalisation Renminbi internationalisation is at a turning point on the path of development, when the “16+1” also plays key role. To be able to continue relying on working capital outflows, they are to be expanded to enhance cross-border investments, financing, and reserve functions. Among the countries of Central and Eastern Europe, Hungary has been at the forefront in the internationalisation of the renminbi and played an exemplary role. In September 2013, China and Hungary signed a renminbi currency swap agreement (the first of the kind in Central and Eastern Europe) with a value of RMB 10 billion which was renewed after its expiration in 2016. In 2016, Hungary was the first to issue renminbidenominated panda bonds in Hong Kong and subsequently renminbi bonds in mainland China following the example of Poland. Another significant development is that the Hungarian Branch of the Bank of China became authorised to serve as a renminbi-clearing bank in Hungary. III.3. Innovative Cooperation Innovation-driven industrial transformation and upgrading is a task facing both China and the CEE countries. Production capacity, energy, logistics, and agriculture provide productive platforms for cooperation in innovation. China proposed the implementation of a partnership program with a focus on technology within the “16+1” framework and urged the launch of the CEE Innovation and Startups Forum, which was organised in Bratislava last year. These initiatives encourage the partners BROAD STROKES

to build joint laboratories and science parks and promote expert exchanges. China welcomes Central and Eastern European companies to participate in the “Made in China 2025” program and supports the creation of a 16+1 entrepreneurial innovation and development platform. The role of SMEs in this innovative cooperation cannot be ignored either.

III.4. China–EU Relations The “16+1” Cooperation is an important part and a beneficial supplement of the China–EU relations. It is a cross-regional pragmatic cooperation platform, within which the parties adhere to the principle of openness and transparency, keep the cooperative values under the framework of China– EU relations, and act according to the relevant EU laws and regulations. The “16+1” Cooperation is open: China welcomes the active participation of other countries and international organisations to create a trilateral cooperation. The European Union, Austria, Switzerland, Greece, Belarus, and the European Bank for Reconstruction and Development are acting as observers in the mechanism. Experience has proven that the “16+1” Cooperation does not harm the overall interests of Europe; on the contrary, it has positive effects on the European integration process and boosts the balanced development of China–EU relations.

REFLECTIONS ON CHINESE– EUROPEAN RELATIONS

An interview with Dr Huang Ping, General Director

of the European Institute of the Chinese Academy

of Social Sciences, General Secretary of “16+1” Think Tanks Network, and President of the China– CEE Institute

How do you see Chinese–European relations and the development of the cooperation between China and the European Union?

Relations with Europe and the European Union in particular have very much been in focus in the past

years, and since Xi Jinping came to power, we have

placed further emphasis on these relations. China is interested in more comprehensive, sustainable environmental development. We believe we can

learn a lot from Europe in this respect. China remains committed to its reform and opening-up policy and is even continuing its opening to the world, including

towards Hungary, in a more comprehensive manner.

This is not a one-dimensional but a rather more

sophisticated, market-oriented reform. As part of this reform, we have concluded several agreements with

the European Union on sustainable urbanisation,

more inclusive society, and so-called green development. Whatever challenges Europe must

face today, we believe that China and Europe can maintain and further develop relations based on the principle of mutual benefit.

The “16+1” Cooperation offers a good opportunity

to Central and Eastern European (CEE) states to strengthen their economic, financial, cultural, and

diplomatic relations with China. In your opinion, why did China decide to initiate a cooperation platform with these countries as a single bloc?

As I mentioned previously, we are aware of the importance of Chinese–European relations. We have already had good relations with Germany, France,

Great Britain, and the Netherlands, but we did not pay enough attention to the CEE region. In the past 20-30

years, since the break-up of the Soviet Union, this region has gained importance not only for Europe but

also for China. It was in fact then Prime Minister Wen

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Jiabao who proposed that we should have such a

versatile cooperation platform with these 16 countries of Central and Eastern Europe. There is of course no

mathematical reason behind it, simply the fact that there are 16 countries in the region. We think that the

“16+1” could be part of Chinese–European relations as a subregional cooperation.

What is the importance of the “16+1” summits?

I believe the meetings of prime ministers and presidents is quite important because various programs and the agenda for the next year are adopted at these summits. However, in addition

to state leaders, ministers of various specialities— such as education, transport, and trade—also have their meetings where they refine these programs. Thank you very much!

Interview conducted by Bernadett Hári in May 2017

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THE 19TH CONGRESS OF THE CCP—ANNOUNCING THE “NEW ERA” Viktória Anna Papp

As the modernisation and economic development of the past decades have propelled China to a more prominent international position, the country has also increasingly gained the attention of international media. At the same time, China also became interested in achieving higher visibility in the media, opening towards the world and offering greater insight into its domestic politics. Party congresses have always been focal points in Chinese political life, but the last, the 19 th National Congress (abbreviated in Chinese as shijiuda) of the Chinese Communist Party (CCP) was special for a number of reasons. The highest echelon of Chinese political leadership went through the widest-ranging personnel changes in a decade and—in a departure from previous practice—the “thoughts” of PresidentGeneral Secretary Xi Jinping have already been incorporated into the party constitution at the end of his first term. Xi also introduced the “New Era” of China, which will probably be a key concept in the discourse about China during his

next cycle as party leader and beyond. The first and founding national congress of the CCP was held in 1921 in what is today Shanghai’s Xintiandi district. Early party congresses under Mao Zedong’s rule had significantly different choreography than the current ones. Meetings have then been convened with some degree of irregularity, and actually, none has been held between 1956 and 1969. Most of the time, foreign observers and journalists were left guessing the details—more often than not using “Kremlinology methods”—because both the preparations and the actual congresses happened in secret, behind closed doors. While this still happens quite often, foreign journalists have been invited to the last party congress in record numbers: more than 1,800 journalists were allowed to report the events, something that would have been inconceivable just a few decades ago. Later, in the second half of the 1970s and in the wake of Deng Xiaoping’s reforms, the rules and customs governing party congresses

Where the most important meetings take place: the Great Hall of the People 58

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General Secretary 1 Person Standing Committee 7 Members Politburo 25 Members Central Committee approx. 400 Members National Party Congress approx. 2,300 Members Chinese Communist Party approx. 90 million Members Structure of the CCP

solidified, avoiding earlier uncertainties and ensuring continuity within the party. It was at this time that the rule to hold congresses every five years was established, and a retirement age for party members was also implemented. Under the (informal) qishang baxia rule, party officials could not be elected to any position beyond the age of 68. Since Deng’s leadership, it became a practice to elect a new general secretary after every two five-year cycles and to integrate the departing general secretary’s ideology into the party canon, the CCP Constitution. While at the time of its establishment the CCP had only 57 members, today it is the world’s biggest political party with nearly 90 million members. Although in theory the Congress is the CCP’s largest and most important body, political decisions are in practice made by the much more restricted Standing Committee of the Central Political Bureau (Politburo Standing Committee or PSC). The main duties and prerogatives of the congress include determining the basic principles and political directives for the next five years and beyond, evaluating the previous cycle based on the general secretary’s report, amending the party constitution, and electing members for the 400-strong Central Committee (CC), the currently 25-strong Political Committee (PC), and the Secretariat.

In line with previous practice, preparations for the most recent party congress, reports of the general secretary and the Central Commission for Discipline Inspection, and the amendments to the party constitution began at least a year earlier. The 6 th plenary meeting of the 18 th Central Committee conferred Xi Jinping the title of “core leader” and announced in an official statement that the 19th Congress of the CCP will be held in the second half of 2017. The election of representatives for the congress also began at rural, city, and provincial level local congresses. The report presented by the general secretary on behalf of the 18th Central Committee was also drafted during this year of preparations with the involvement of several thousand party members, incorporating the compromises between various party factions and formally cementing the entire leadership’s political stance. The exact date of the congress was announced at the seventh and last plenary session, and official preparations began at the same time. The 19th Congress of the CCP was eventually held in Beijing between 18 and 24 October 2017, with the participation of 2,287 delegates from every Chinese province and all minorities. On this occasion, about half of the CC’s 205 members with voting rights were replaced with members newly elected by the congress. Afterwards, the first plenary session of the new Central Committee elected the new members of the narrower leadership. Those who have reached the party’s retirement age, i.e. four members of the Central Military Committee, six members of the PC, and five of the seven members of the PSC—except for President-Secretary General Xi Jinping and Prime Minister Li Keqiang—have not been re-elected. Unsurprisingly, the new Central Committee re-elected “core leader” Xi Jinping for another five-year term. Two new members have been elected into the de facto main governing body, the PSC: Li Zhanshu, the current head of the CCP’s administrative body and Wang Yang, former party secretary of Chongqing and of Guangdong between 2007 and 2012 who was already a serious candidate for PSC membership at the previous congress. Three other new PSC members have also been elected: Wang Huning, BROAD STROKES

Postage stamp issued on the occasion of the 19th National Congress of the Chinese Communist Party

professor of the reputable Fudan University, who has been in charge of party organisation, ideology, and propaganda as head of the Central Policy Research Office since 2002, Zhao Leji, who replaced Wang Qishan as the head of the Central Commission for Discipline Inspection, spearheading the country’s anti-corruption campaign, and Han Zheng, who has held various party positions in Shanghai and is currently the mayor of the city. These new members will form the party’s highest leadership for at least the coming five years and their work is indispensable to carry out the reforms announced by Xi. The congress has been a success for Xi Jinping on several fronts. Not only has he been re-elected as secretary general, but the congress also ratified the amendments to the CCP’s Constitution, incorporating his 2012 One Belt, One Road Initiative. More importantly, Xi’s “thoughts” have also been incorporated into the constitution. Such an early canonisation of a party leader’s thoughts has only happened once before, in the case of Mao Zedong. Deng Xiaoping’s theory was only incorporated after his death, while the ideologies of Jiang Zemin and Hu Jintao have only been added to the constitution at the end of their second (and last) terms. The broad ideological program entitled Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era concerns both Chinese foreign relations and the domestic arena. Its main goal is to develop China into a “modern Socialist country.” Xi detailed his program in 14 points, which include reinforcing the CCP’s leading role in every field, ensuring continued reforms and development, improving living standards, and the protection of the environment. The beginning of the 60

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new Xi era responds to challenges faced by the new China and the party, while it is also a marked departure from the eras of the previous two most notable leaders of the People’s Republic of China, Mao Zedong and Deng Xiaoping. The Secretary-General’s three-and-a-halfhour report presented on the opening day of the congress summarised the nation’s achievements in the past five years and laid the foundations and the general policy outlines for the next five-year cycle. According to the plan presented at the party congress, by 2020, China will have a “moderately prosperous society,” by 2035, it will have “basically achieved Socialist modernisation,” and by 2050, it will become a “prosperous, democratic, culturally advanced, harmonious and beautiful great modern Socialist country.” Xi Jinping also announced that by 2050, China will be “a global leader in terms of composite national strength and international influence,” projecting a more proactive foreign policy attitude. Xi, however, also stressed that China does not strive for hegemony, in its foreign relations will be committed to build a “community with shared future for mankind,” i.e. it is willing to lead a foreign policy through partnerships and the reconciliation of interests. Concerning the country’s economic future, the report plans a switch from quantitative growth to a qualitative development based on higher added value and the continuation of the policy of reform and opening-up. China has an increasing ambition to gain an equal footing with the other major powers of the international arena. The growing economic protectionism and America First policy of the United States provides China with a wide playing field in this respect. China will also continue to develop its One Belt, One Road Initiative mainly consisting of infrastructure, trade, and financial projects, which is both the engine of international cooperation and the key to fulfilling Xi’s main program, the “Chinese dream.” The ambitious plans announced at the party congress will have to be implemented by the current and next leaderships, but Xi is also trying to create the necessary cooperation and unity. One thing is certain: Chinese changes will not only affect East Asia but the larger international scene—thus we should pay attention to what Xi’s next cycle will bring.

THE INTERNATIONALISATION OF THE RENMINBI AND THE RENMINBI PROGRAMME OF THE CENTRAL BANK OF HUNGARY Dániel Palotai

Chinese economic growth is one of the most important pillars of the global economy. The Asian country is advancing to the frontline of the world in ever more aspects and the expected continuation of this trend requires a focused approach from others. For today, China is not only coordinating the world’s largest development initiative—in the form of building up the New Silk Road overarching Eurasia and even East Africa—but has also become a key player due to its trading and financial relations, of which one of the main element is the internationalisation of the renminbi. Realising the opportunities offered by China, Hungary has also launched a series of initiatives to strengthen economic and financial ties with China, thereby also supporting the internationalisation of the renminbi. THE MILESTONES OF THE INTERNATIONALISATION OF THE RENMINBI Current economic, financial, and social trends point towards the emergence of a significantly changing, multi-polar world order, in which China is more and more becoming a key player. According to several experts, the 21st century could be the century of Asia: the dynamic economic growth of Asian countries—in particular China—could remain the driving force behind global growth in the future as well. At the same time, besides handling structural challenges, the innovation-driven approaches are gaining ground increasingly. During the past years, China has achieved significant economic results, even though catching up in a sustainable manner has required ongoing reforms. China has the world’s largest economy measured at purchasing power parity, the country has the highest foreign trade volume in the world. Through its New Silk Road initiative, the so-called Belt and Road Initiative, China coordinates one of the world’s largest development projects, while its currency has become an international reserve currency. The gradual and ongoing reforms towards its market liberalisation have played a major role

in Chinese economic development, while the internationalisation of the renminbi has brought into focus within the development of economic and financial relations. The Chinese currency is rapidly gaining further ground on the international stage. In order to achieve a defining status on the international level, a country’s currency has to fulfil a series of prerequisite requirements. First, it has to be permanently present in international trade and financial transactions, then, it has to become an investment vehicle, and finally, through gaining the acceptance of global financial markets, it can assume the role of a financing currency. China has already made steps towards its currency’s convertibility in 1994, but the Asian financial crisis in 1997 have posed serious challenges to these aspirations. China joined the World Trade Organisation in 2001, which led to a spectacular jump in Chinese economic performance and opened up ways for further exchange rate policy reforms. Besides applying a controlled floating mechanism, China has also moved towards a more flexible financial system in the past years. The improvements of China’s BROAD STROKES

foreign trade positions have been followed by the growing acceptance of the renminbi as an international currency with a phase delay of a couple of years, but significant results have been achieved in this regard during the last few years. In the past ten years, both the volume and proportion of the foreign trade transactions denominated in renminbi has grown significantly. Based on data from the SWIFT, responsible for international settlements, the Chinese currency is the fifth most frequently used currency in international transactions (behind the U.S. dollar, euro, pound sterling and Japanese yen). However, on a global level, the dollar still retains its dominant role in international financial settlements; moreover, the same is true in case of those transactions in which the final-beneficiary is located in China or Hong Kong. Using the renminbi in settlements of cross-border trading transactions has several advantages, including lower transaction fees and reduced exchange rate risks. The Chinese bond market has also shown explosive growth over the past few years, mainly due to the ongoing opening of both the onshore and offshore markets. In order to further diversify and enlarge its financing sources, China is developing its bond market through targeted measures. In the previous years, foreign players mainly had access to the offshore market, but in parallel with the gradual internationalisation of the renminbi and the continuous market liberalisation, an increasing number of issuers and investors are turning towards the onshore market. Besides the bond market, the stock market is also developing on its merits; one of its central elements was the connection of the Shanghai and Hong Kong stock exchanges. Representatives of the Chinese economic policy have stated their intentions years ago to make the renminbi one of the world’s key reserve currencies. The internationalisation of the renminbi made its most significant advancements after the 2008 world financial and economic crisis, a time when China itself became the world’s biggest exporter. However, the classic trilemma of the economics, the so-called “Impossible Trinity,” influenced this process as well, whereas any given country can only choose two of the following three 62

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People’s Bank of China headquarters in Beijing

policy choices: free capital movement, a fixed exchange rate, and independent monetary policy. The gradual liberalisation of capital movements has thus required a more flexible exchange rate policy. In order to facilitate access to the onshore market, the People’s Bank of China (PBC) has implemented some programs since 2010, ranging from the gradual opening of the interbank market to developments of the exchange rate mechanism. The Central Bank of Hungary (MNB) recognised these achievements among other things, when it awarded the international Lamfalussy Award to Zhou Xiaochuan, the Governor of PBC in 2018. The International Monetary Fund’s (IMF) decision made in 2015 was a milestone in the integration of the Chinese economy into the global financial system. Following a revision of the basket composed of the most significant reserve currencies, the Executive Board of the IMF agreed that the renminbi has met the criteria for inclusion in the SDR (Special Drawing Rights) basket; thus the renminbi was included in the basket as the fifth currency—in addition to the U.S. dollar, Japanese yen, euro and pound sterling—as of 1 October 2016. The decision was also a recognition of China’s efforts to reform its monetary and financial system. In the past few years, central banks around the world have announced openings towards China. In the first half of 2017, the European Central Bank has diversified a smaller portion of its reserves into renminbi-denominated assets, thereby recognizing the growing role of the renminbi in the international financial system. The French and German central banks announced similar steps. Currently the renminbi is the world’s seventh most

important reserve currency, with over 60 states and regions holding part of their reserves in the Chinese currency. The growing global weight of the Chinese economy is also reflected by the increasing role of the renminbi in international settlements. Further gains, however, may require continued economic reforms, an ongoing revision and, if necessary, adjustment of relevant market regulations, and further infrastructural developments. It is not only China that must open towards the world, but the world must also open towards China. The 21st century points towards the emergence of a multi-polar world order, which is also reflected in the changes of the international monetary system. These new opportunities and the already launched Hungarian programmes serve as an adequate basis for further developing Chinese– Hungarian economic and financial relations. AN OVERVIEW OF CHINESE–HUNGARIAN ECONOMIC AND FINANCIAL RELATIONS Hungary has traditionally maintained good and diverse relations with China, but in recent years, it brought these relations to a higher level. Besides that China has a more significant role among Hungary’s foreign trading partners, Hungary has also become one of the most important destination of the Chinese foreign investment in the region during the recent years. The bilateral economic relations have reached the level of a strategic partnership by 2017; due to the Eastern Opening Strategy of the Hungarian Government announced in 2011, the strategic agreements made by the Chinese companies and Hungary’s commitment to the Belt and Road Initiative. The Central Bank of Hungary has also contributed to further development of Chinese–Hungarian economic relations by using the instruments at its disposal. The MNB has supported these goals through multiple channels, especially regarding the possibilities in investments, financing, financial markets, and financial infrastructure. In addition, the MNB’s programmes have also supported the internationalisation of the renminbi. In the past few years, China has become an increasingly important foreign trading partner to both the European Union and Hungary. In 2016,

Hungarian exports to China amounted to USD 2.5 billion, having had doubled in ten years. Chinese imports to Hungary are traditionally higher than that, but Hungary’s trade deficit has generally decreased in the past years. The renminbi has also played an increasing role in Hungarian–Chinese trade settlements: within Hungarian exports to China, its share has reached approximately 40% in 2016. Settlement in the Chinese currency is also beneficial to Hungarian companies, as the elimination of an intermediary currency can further boost trading relations. THE RENMINBI PROGRAMME OF THE CENTRAL BANK OF HUNGARY In the past years, the MNB has had a structured approach in opening towards the Chinese market, and as a result of it, the MNB has developed wide-ranging relations and results, of which the central bank’s renminbi programmes form the core elements. In 2013, the MNB was the first in continental Europe to sign a bilateral currency swap agreement with China in order to facilitate trading and investment relations, thereby also contributing to the internationalisation of the renminbi. Today the currency swap agreements have become an integral part of the central bank’s tools as instruments ensuring the stability of the financial and real economy markets. In an effort to facilitate the further development and deepening of Chinese–Hungarian relations through its specific central bank instruments, the MNB has launched a comprehensive renminbi programme in 2015. The Hungarian Central Bank’s Renminbi Programme was launched symbolically on the first day of the Chinese New Year. Within the framework of the programme, several goals have been identified, such as the building up of a renminbi foreign exchange reserve portfolio, providing the central bank renminbi liquidity instrument in case of market disturbances, developing the renminbi settlement infrastructure, and ensuring financial stability aspects. The Central Bank of Hungary—in line with international practice, but prior to the IMF’s decision on the inclusion of the renminbi in SDR basket—has decided to build up its own Chinese BROAD STROKES

bonds portfolio gradually. This decision was made based on the assessment of the internationalisation of the renminbi, the structural specifics and the yield and risk parameters of the Chinese bond and foreign exchange market, and the requirement to diversify the portfolio of the foreign exchange reserves. In the first phase, the MNB invested in Chinese bonds with the involvement of the Bank of International Settlements, followed by establishing direct investment possibilities with the Chinese central bank and an agency agreement with the Bank of China. The MNB has also concluded several agreements with the PBC and the Bank of China regarding the development of the renminbi settlement infrastructure in Hungary. In conjunction with the Central Bank’s Renminbi Programme, the MNB has also launched the Budapest Renminbi Initiative, offering a multilateral platform for all those market participants, corporate and bank executives and government representatives, who are involved in Hungarian–Chinese real economy and financial relations. While the Central Bank’s Renminbi Programme defines those fields where the MNB may play a role, the Budapest Renminbi Initiative aims at reaching further results with the involvement of the relevant stakeholders. In the past years, expansive developments have been achieved on the capital, financial and foreign exchange markets also with regard to Hungarian– Chinese relations. One of the main programs supporting the capital inflow is the Renminbi Qualified Foreign Institutional Investors Program, in which the foreign institutional investors entitled to invest in the Chinese onshore securities markets. In 2015, PBC decided to extend this scheme to Hungary with a total investment quota of 50 billion renminbi. The direct trading between renminbi and Hungarian forint has already been launched on the onshore Chinese foreign exchange market. The introduction of the direct RMB/HUF listing supports the development of bilateral trade and investment relations, the use of both currencies in cross-border settlements may reduce the conversion costs in longer term. In 2015, significant progress has also been achieved in the development of the Hungarian clearing and settlement infrastructure, due to the establishment of a Central and Eastern European 64

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renminbi clearing centre in Budapest; the Bank of China aimed at providing proper infrastructure to the settlement of renminbi transactions and widening the range of financial services to clients. In Hungary, the Bank of China operates as a Chinese bank, while other commercial banks also offer services denominated in renminbi (ranging from account services to renminbi-denominated investment products). The Hungarian OTP Bank has opened a representative office in China in July 2017, as a first step towards later becoming an active participant in the Chinese banking sector. In conjunction with the Central Bank’s Renminbi Programme, the MNB hosts on an annual basis— for the fourth consecutive year in 2018—an international conference in order to support further market development in line with its aims. CLOSING REMARKS China’s economic weight in the global market is unquestionable, while its development potential offers significant opportunities even in the short term. Chinese economic development results in fundamental changes as indicated by the fact that the renminbi has entered the ranks of the world’s leading currencies. The internationalisation of the renminbi also promotes the further development of financial markets and foreign trade relations. In the global competition of development and reforms, it is crucial to recognise the opportunities that will shape the future. The Hungarian–Chinese economic, financial, and economic diplomacy relations have followed this path in the last years, and with the support of the Hungarian Government and the Central Bank of Hungary, significant further results can be forecasted. The continued development of economic ties brings new opportunities not only to the two countries, as Hungary can serve as a bridge between Europe and Asia along the New Silk Road.

PROSPECTS OF THE RENMINBI TO BECOME AN INTERNATIONAL CURRENCY Gao Haihong

In the beginning of 2018, the German Bundesbank confirmed that it would add the renminbi to its foreign currency reserves. Earlier, the Bank of France and the European Central Bank have included the renminbi in their reserves. These actions reaffirmed that the renminbi has become one of the potential options for central banks to allocate their foreign assets. By the end of 2016, on global level, approximately 60 monetary authorities have officially held the renminbi as their foreign reserve currency. Becoming an international reserve currency is one of the key criteria for the success of renminbi internationalisation. The achievement that the renminbi has made so far reflects three main appealing features of the currency as a reserve currency. Firstly, the major trend of the change in the international monetary system after the global financial crisis is the diversification of foreign reserves in official holdings. The US dollar has been the official foreign reserves, whose share in the international reserve assets far exceeds its global economic weight since the 1970s. The recent global financial crisis has approved that the dollar domination of the global reserve system is unsustainable. Thus, increasing the amount of non-dollar reserve currencies held comes to be a feasible solution to diversify reserve assets investments, preserve asset values, and minimise risks for the monetary authorities. As an emerging market currency, the renminbi not only fulfills the requirements of becoming an international reserve currency but also grants investors the access to the vast Chinese market. Secondly, capital account openness in China is on the agenda and is moving forward gradually. This ensures the accessibility of the renminbi for

foreign investors. The inclusion of renminbi in the Special Drawing Rights (SDR) basket of the IMF in 2016 could be considered as the result of two prevailing facts. First of all, China has long been recognised as the second largest economy with remarkable share in world trade. By adding the renminbi to the SDR basket, the composition of official foreign reserves could better reflect China’s growing significance, which makes the basket more representative. Another progress during the course of the years is that China has committed itself to foster greater renminbi convertibility. China has lifted the controls for the categories with moderate risks under the capital account transactions. For example, direct investment and interbank market face little or none of the restrictions; cross-border financial products denominated in renminbi, such as the increase of issuances of Panda Bond and Dim Sum Bond, grow rapidly; the renminbi offshore market has developed very fast. Currently, 23 major cities worldwide have established renminbi clearing centers. Additionally, the renminbi denominated crude oil futures contract has been launched in Shanghai, providing another option for market participants, alongside the benchmark denominated in the US dollar. China’s domestic financial market is still subject to the quotas granted for the Qualified Foreign Investment Institutions (QFIIs). However, China has set up various channels to provide foreign investors alternative entrances into its stock and bond markets, which, to name a few, include Shanghai-Hong Kong Stock Connect, Shenzhen-Hong Kong Stock Connect, and Mainland China-Hong Kong Bond Connect. Thirdly, cooperation between the People’s Bank of China (PBoC) and other central banks has played an important role for renminbi’s official holdings. BROAD STROKES

Since 2008, the PBoC has signed a wide range of bilateral currency swap agreements for the renminbi with the monetary authorities in other countries and regions. This approach creates mutual benefits for both sides. On one hand, according to the contract, the renminbi could impart liquidity to the countries facing financial crisis, and in peaceful times, the counterparties could also use renminbi to finance bilateral trade with China. On the other hand, signing swaps with other monetary authorities is the opportunity for the PBoC to raise renminbi’s international acknowledgement. By the end of 2017, the PBoC has signed 36 bilateral currency swap agreements, with the total worth of RMB 3.4 trillion. Renminbi internationalisation has gone through promising development as well as stagnation in the past few years. Its development could be categorised into two phases. The first phase, from 2009 to the third quarter in 2015, depicted the rapid consummation of the renminbi’s role as payment currency. With the brisk expansion of renminbi’s offshore market, the amount of overseas renminbi deposits massively increased. The establishment of renminbi clearing banks and renminbi offshore centers all over the world was a response to accommodate the rising demand for renminbi transactions. At the same time, the pace 66

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for capital account openness sped up and was accompanied by a sharp appreciation of renminbi. Starting from 2009 until August 2015, the nominal exchange rate of the renminbi against the US dollar has appreciated by 11%, which further boosted the market appetite for acquiring renminbi assets. The second phase involves stagnation in the process of renminbi internationalisation, which began from the third quarter in 2015. The size of the renminbi offshore market has shrunk, which impaired renminbi’s role in trade settlement and investment denomination. The repercussions include renminbi depreciation and large-scale capital outflows from China. In order to tackle the increased financial risks and foreign exchange market volatility, Chinese authorities tightened the control over cross-border capital flows, which has slowed down the pace of capital account openness and undermined renminbi cross-border trade. Despite the fact that the renminbi had already been functioning as store of value, medium of exchange, and unit of account, compared to the US dollar and the euro, the role of renminbi as an international currency is still fairly limited. For example, the dollar has a share of 60% in global foreign exchange reserves, and the euro has nearly 20%, while the renminbi’s share is

The Shenzen Stock Exchange is one of China’s three stock markets, besides Hong Kong and Shanghai

approximately 1%, according the IMF’s statistics. The renminbi is the 6th mostly used currency for payment and the 8th largest for transactions in foreign exchange markets, but has the weight of only 1.8% of the total payment amount and 4% of all foreign exchange trade volumes respectively. In order to enhance the status of renminbi as an international currency, several policy actions need to be taken. First, China’s capital account openness has always been one of the necessary pre-requisitions of renminbi internationalisation. However, China has to cope with the trade-offs between free capital movement and financial shocks injected into the domestic economy from the international market. It is important to emphasise that opening up the Chinese financial market is the engine that drives renminbi internationalisation, which could not be done in the reverse order. Second, a developed domestic financial market is crucial for the international usage of the renminbi. At this stage, China aims to maintain its financial stability and improve the effectiveness of supervision, which are the foundations of a sophisticated financial market that covers a large scope with great depth and high liquidity. Third, a flexible exchange rate regime is also a requirement for the renminbi to

become a primary international currency. The PBoC has adopted a pricing mechanism by which the renminbi’s intermediate price is determined with reference to the index of China Foreign Exchange Trade System (CFETS). This approach allows the PBoC to avoid excessive volatility in the foreign exchange market while keeping the exchange rate flexible. Furthermore, a greater flexibility of the exchange rate determined by market forces can support a wider use of the renminbi and at the same time allows the monetary authority to conduct independent monetary policy in face of freer cross-border capital movements. Going forward, there is still a long way to go before the renminbi can truly become an international currency. Renminbi internationalisation depends on China’s ability to maintain its economic power. It also relies on the pace and degree of China’s financial openness. The process of renminbi internationalisation has also been intertwined with the changes in the global financial market and the evolution of the international monetary system. Nevertheless, the question of how the renminbi retains its attractiveness and increases its role as an international currency in the future shall be answered by the market choice.

BROAD STROKES

THE DECARBONISATION OF CHINA—MYTH OR REALITY? Cecília Varsányi and Mihály Kálóczy

China has become one of the forerunners of fighting climate change in recent years, and it continues spending fortunes on overcoming pollution. The Chinese government has recognised the environmental impacts of the desired economic development based on forced industrialisation and its catastrophic consequences: the new aspirations introduced in the country’s energy policy are in fact indispensable. China’s new decarbonisation policy is not an offhand decision but a result of a long process. It is not only propelled by environmental pollution and social dissatisfaction; it is also an economic interest. Nowadays, energy production and environmental protection go hand in hand in developed countries. In recent years, China has made it to the front pages several times for the dynamically growing number of its renewable energy generation capacity installations. However, the question remains if there is a real potential for a country which is the world’s largest greenhouse gas emitter in absolute terms to become the Nr. 1. exploiter of renewable energies. Will the steps taken be sufficient to address the far-reaching problems, or do they only offer a superficial solution? What are the predictions when considering China’s current social, economic, and environmental status, i.e. the three pillars of sustainability? THE BACKGROUND The structural reform announced by the Chinese Communist Party 40 years ago has led the country’s economy to an export-driven growth model and has turned China into a leading global power, while also making it one of the world’s most affected regions by environment- and health-related issues. Looking at China’s present socio–economic situation, it is up to its leaders what direction they choose to achieve the country’s aspired 68

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economic growth, possibly without leading the region into a total environmental disaster (Figure 1) . China’s example perfectly demonstrates the complexity and the essence of sustainability: the surprisingly strong interactions among society, economy, and environment. The environmental problem is in fact a socio–economic problem, so all three areas need to be handled jointly.

Figure 1: The most toxic countries in the world

THE SOCIETY According to the most recent estimates of the World Bank, China’s population reached 1.4 billion by 2016 (Figure 2). In addition to the population explosion, the age structure of the Chinese society was clearly influenced by the family planning program introduced in 1979. Despite the mitigation of the provision in recent years, the effect of the onechild model is well visible on Figure 3: while in the 1960s we can see a triangular corpus, typical of the developing societies, the current age structure of China is characterised by an aging population, as in more developed societies. In response to this, the Beijing government has eased the rules, so now not only those married couples can have a second

Female

Male

0.0% 0.2% 0.6% 1.4% 2.7% 3.2% 2.9% 3.2% 4.3% 3.6% 2.6% 2.5% 2.6%

0.0% 0.0% 0.0% 0.2% 0.5% 0.8% 1.2% 1.8% 2.8% 2.9% 3.7% 4.6% 4.4% 3.5% 3.7% 4.9% 4.1% 3.0% 2.9% 3.1% 3.2%

2.8% 2.7% 2.7% 2.2% 2.1% 2.2% 2.2% 2.1%

2015 / Population: 1,376,048,942

Female

0.0% 0.0% 0.1% 0.3% 0.6% 0.9% 1.2% 1.9% 2.8% 2.8% 3.5% 4.4% 4.2% 3.4% 3.5% 4.5% 3.7% 2.7% 2.5% 2.6% 2.8% 8%

10%

1960 / Population: 644,450,173

0.0% 0.4% 0.4% 1.1% 2.3% 3.1% 2.9% 3.3% 4.5% 3.9% 3.0% 2.9% 3.1% 3.2% 3.1% 2.7% 2.4% 2.4% 2.4% 2.4% 2.3%

7.1% 7.2% 10%

2.7% 3.1% 3.5% 3.7% 3.9% 5.1%

7.5% 7.6%

3.0% 3.5% 4.0% 4.3% 4.4% 5.5%

Male

0.1% 0.4% 0.6% 1.0% 1.3% 1.8% 2.0% 2.3% 2.6%

0.1% 0.2% 0.5% 0.8% 1.2% 1.7% 2.0% 2.5% 2.9%

10%

35–39 30–34 25–29 20–24 15–19 10–14 5–9 0–4

Female

Male

Age

100+ 95–99 90–94 85–89 80–84 75–79 70–74 65–69 60–64 55–59 50–54 45–49 40–44

Figure 4:

2050 / Population: 1,348,056,330

10%

child where at least one of them is an only child. (In addition, population data may change somewhat since formerly “illegitimate” children can also be registered.) Although many people argue about the humane side of the former one-child policy, according to estimations, around 400 million more children would have been born in the past decades without this legislation. Having given further consideration to the social aspects of China’s sustainable development, the Beijing government is trying to apply a different approach in its environmental ambitions. The religious philosophy of Chinese universalism emphasises the importance of harmony between nature and humanity. After laying out the plan on the 18th National Congress of the Communist Party of China, the country’s leadership has returned to this tradition in recent years: Wu Xiaoqing, former Deputy Minister of Environment, talked at a 2013 conference in Kenya about the intentions of the Chinese government to move the country towards a “green” and “sustainable” economic growth.

2030 70

2020 60

2010 50

2000 40

1990 30

1980 20

1970 10

Figure 2: Population growth of China

1960 0

10%

200000000 0.2

400000000 0.4

10%

600000000 0.6

1E+09 1.0

8 00000000 0.8

billion people

1,2E+09 1.2

This new direction—the so-called “ecological civilisation”—to some extent addresses the environmental challenges of China and the religious and cultural traditions such as Confucianism, Taoism, and Buddhism, which can strengthen the awareness of environmental protection in the society. The various forms of Chinese Communist atheism had suppressed these views, but in recent years, Beijing’s leadership has started finding ways back to the country’s religious traditions advocating environmental protection. It must do so indeed, as the number of environmental demonstrations has increased throughout the country, ranging from rural protests to urban movements. Looking at Figure 4, one cannot be wondered at that—and unfortunately this is just the tip of the iceberg.

1,4E+09 1.4

China CHN Population, total SP.POP.TOTL 1,6E+09 1.6

Figure 3: China’s population pyramids: 1960, 2015, 2050 BROAD STROKES

THE ECONOMY The 13th Five-Year Plan (2016–2020), just like the earlier ones, designates the most important goals and strategies of economic and social development under the central planning framework. Of course, one of the main goals is to raise the population’s general standard of living: the Chinese leadership plans to double the 2010 GDP and per capita income for both urban and rural residents by 2020. Investment-driven GDP growth and the high rate of household savings were typical over the past decade: these deposits served as cheap capital for public investments as seen on Figure 5.

Figure 5: Changes in savings, investments and household consumption

If China’s government wants to maintain the 6.5% annual growth rate forecast by the current Five-Year Plan, it should not allow a significant drop in investments, while it should boost the increase of household consumption parallel to that. For the latter, the disposable income of the traditionally very thrifty Chinese population should increase significantly in order to establish the desired consumer society. The government aims to expand the urban labour force within the plan of raising the standard of living, which is supported by measures such as the facilitation of the residents’ moving to cities (after receiving cash for their lands, new residents receive the apartments for free, etc.). So, the human resource of the less productive agricultural sector is intended to be converted into workforce and into consumers of urban industrial production. Of course, many had no other choice but to give up their land for governmental industrial investments and move to the cities against their will. The majority of 70

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the infrastructural developments have been implemented in the areas of Inner China, where in many cases, the population has not arrived, therefore complete ghost cities have been created, mostly close to major cities. Nevertheless, the government is hopeful – its ultimate goal is to integrate the 70% of the country’s population into city dwellers by 2025 to expedite the expansion of the urban consumption sector. If consumption increases, economic growth is inevitable... Still, the question remains: until what point and at what cost? Once this gigantic population with increased purchasing power comes into existence, will it ever take the environmental impacts of its own consumption into account? THE ENVIRONMENT The above raises further questions, too, such as how energy production can keep pace with this massive consumption boom, and how the ever-increasing demand for raw materials can be satisfied. It is a fact that China’s GDP has remarkably grown over the past decades (the annual GDP growth in 2016 exceeded 6.5%, though it was above 15% around the mid-1980s). It is worth mentioning how energyintensive this improvement has been. Figure 6, created by the Energy Information Administration, shows that the Chinese energy intensity indicator is one of the worst in the world. (Energy intensity is defined as energy use per dollar of real GDP, and it shows how much energy should be used to produce one dollar of gross domestic product by, for example, burning fossil fuels.) At the same time, it is remarkable that the present conditions reflect an energy intensity which has been reduced by two-thirds since the 1990s. THE ENERGY- AND CLIMATE-RELATED ASPECTS APPEARING IN THE LEGAL FRAMEWORK The first Chinese environmental protection provisions found in a grave in Sichuan Province were engraved in wooden blocks and date back to more than two thousand years ago. The reigning Qin Dynasty at the time restricted the logging of young trees for farming communities, and set a limit on hunting and gathering. The People’s Republic of China was established in 1949, and the

Figure 6:

current version of its constitution was adopted on 4 December 1982. It has been modified four times since then. As Article 9 of it defines: “All mineral resources, waters, … and other natural resources are owned by the State, that is, by the whole people … The State ensures the rational use of natural resources … Appropriation or damaging of natural resources by any organisation or individual by whatever means is prohibited.” The most important policy documents in China are the five-year plans that set the overall direction of China’s economy and society often including the related top-level targets. These plans are complemented by laws, passed by the National People’s Congress (NPC) and policies developed by government ministries. Regarding the deterioration of the environment, the real problems started at the time of the already mentioned reforms, 40 years ago. After 1978, following the rapid expansion of rural townships and village enterprises (TVEs), Deng Xiaoping gave the opportunity to the provinces to extend their scope of authority, which boosted the spread of TVEs. By the end of 2003, nearly 22 million TVEs were operating in China, producing more than 30% of the country’s GDP. It is beyond any doubt that such a huge volume is difficult to be kept under control, whether taking environmental protection or any other regulatory norms into consideration. As China’s state-owned economy remains significant today, it is still difficult to enforce environmental standards.

In 1989, the Environmental Law came into force: it was the first to define limit values for different types of emissions (e.g. poisonous gases or wastewater) and their respective penalties. The Coal Industry Law (1996), as its name suggests, only protects the process and progress of coal mining in China, including all the stakeholders and their rights, and it highlights that the defined environmental regulations are to be followed. The Electric Power Law entered into force in 1996, covering the general principles of the construction, production, supply, and utilisation of the electric power; hence it promoted the development of the electric power system. This became the legal framework for the smart grids to be built later. The Cleaner Production Promotion Law (2002) did also deal with such progressive aspects as the comprehensive utilisation of coal gangues (a by-product of mining), energy saving, emission reduction, and cleaner production standards. The Renewable Energy Law (2006) could still not play its role as a response to climate change, although it contributed to the issues of energy supply, the improvement of the energy structure, safeguarding energy security, environment protection, and the sustainable development of the economy and society. The purpose of the Energy Conservation Law (adopted in 1997 and revised in 2007) is to promote energy conservation in order to enhance energy utilisation efficiency and protect and improve the environment. Besides other issues, it focuses on subsidies and incentives for energy saving, BROAD STROKES

and energy saving product certification. Though climate change has been referred to several times in policy documents guiding legislation, there is still no legislation in force dedicated solely to it. THE 13TH FIVE-YEAR PLAN—AMBITIOUS OR AMBIGUOUS? The 10th Five-Year Plan (2001–2005) declared that 1.2% of the GDP has to be spent on environmental protection, which was a brave step, raising that share by 0.3 compared to the previous plan. The environmental aims of this plan proved partly successful: the solid waste produced by the industrial sector was diminished by 48%, but the total sulphur dioxide emission increased by 28%. The following plan (2006–2010) considered all three pillars of sustainability and the balance among them. Consequently, it aimed at reducing energy intensity and greenhouse gas emission by 20%, but set no target value for the latter. The next period (2011–2015) focused on energy saving, environmental protection, the utilisation of new— nuclear, wind, and solar—energy resources, and clean transportation. Decarbonisation, which means reducing carbon dioxide emissions for the whole society, turned up as a stand-alone target, particularly affecting the industrial and transport sectors. The current plan is somewhat out of line. Global and local conditions prompted the government to change its economic structure. These were the following: easier access to cheap renewable energy resources, the bad reputation of China for environmental pollution and the rate of disease incidences due to it, and the public debt and the effects of Industry 4.0—the latter, combined with the transformation of the economy into a more service-based one, involved a large scale of urbanisation. Decarbonisation, as a principle, can be a solution for many of these problems, but it involves a more moderate GDP growth. Despite the difficulties, directions set by the government show positive aspirations: according to the five-year plan that came into force in 2017, the amount of environmental protection investments could reach USD 360 billion between 2016 and 2020. 72

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In addition, several of the first decrees of 2018 were born in the spirit of fighting pollution. (National People’s Congress has passed a new law to levy environment tax on polluters—this so-called Environment Tax Law came into force 1 January 2018. In addition, according to the rumour that took wind in September 2014, China will soon stop the production and sales of traditional fuel cars.) The 13th Five-Year Plan contains a set of climateand energy-related targets, including an energy consumption cap and a 15% goal for the share of non-fossil-based energy in the country’s primary energy mix. The details, however, are explained in an official complementary document to the 13th Five-Year Plan, which is called the 13th Five-Year Plan on Energy Development (Energy 13FYP). A further decisive document related to this legislation is the Strategic Energy Action Plan (SEAP—2014– 2020). These strategies have similar aims, but the values set in them slightly differ at some points. RESOURCE DEPENDENCY These targets were probably the most anticipated ones by the global community. Are they ambitious? Beyond doubt. The decarbonisation goals until 2020 are planned to be primarily achieved by renewables, natural gas, oil, and electricity, while coal consumption would fall back. Although China diversifies and makes its power mix cleaner—as a result, the share of coal in the total production will fall from two-thirds in 2016 to less than 40% in 2040—it still means a continuous increase, from 1.625 to 3.188 GW. In addition, the country intends to rely on using more gas, probably more LNG from the U.S., and traditionally, some oil. Never should be forgotten that although LNG is cleaner than any other fossil fuels, it still contributes to the CO2 emission and, indirectly, to climate change. Currently, the country plays a key role in the oil markets because the gap between the rising demand of 11.5 million barrels per day (mb/d) in 2016 and the declining production of 4 mb/d has made it the largest oil importer in the world. The demand for transport fuels continues to increase. All these may make China the world’s largest oil consumer. One in four cars on the roads in China will be electric by 2040, while fuel economy standards will limit

the oil consumed in the remainder of the fleet. Oil consumption for passenger vehicles in China is projected to decline after 2030 in accordance with the spread of electric cars. OVERCAPACITY The economic slowdown, along with the shift to a less energy-intensive and more service-oriented economy, resulted in a drop in the demand for electricity. Since the beginning of 2010s, electricity demand and GDP growth have been on diverging paths. In the process of the countryâ&#x20AC;&#x2122;s economic transformation, China is receding from energy-intensive production and consumption, and its energy dependence decreases. The recently accumulated unanticipated surplus in the power-generating capacity led to grid restrictions to avoid losses such as the one in 2015, when 15% of Chinaâ&#x20AC;&#x2122;s wind energy was wasted. This condition can be subdued by transferring electricity, generated in sparselypopulated and remote areas in the north and west, to energy-hungry coastal cities in the east. According to the National Energy Administration, an ultra-high-voltage (UHV) transmission network is under construction. Due to the above-mentioned facts, the original target of having 58 GW nuclear capacity in service by 2020 seems to be unachievable. Considering renewables, the only way to keep nuclear energy on the market is price regulation. If this option is not viable, the share of nuclear power will decrease soon. It is questionable whether the reactors under construction nowadays will ever be in service. Should they be finished, they can contribute to the fight against pollution. The coal plants seem to live hard times too, although at first glance, it is not that obvious why. Despite the overcapacity, ceasing construction projects does not have the desired impact and pace, as building coal plants is a source of economic activity, and these plants have a balancing effect on dispatching electricity on the grid. They are expected to operate at less than half of their capacity in the future.

FROM MYSTERY TO REALITY? It seems that China has recently decided to take the right path, not only in terms of economy but society and environment too. Balancing among the pillars of sustainability will not be easy at all: the proportion of the urban population with disposable income is growing, which leads to an increase in consumption and economic development. To satisfy the ever-growing demand is a challenge, while the suppliers of this demand, the partially state-owned companies are being monitored, punished, and closed because of their polluting activities. At the same time, there is a possibility that laws and measures restricting the factories and manufacturers can be protected by an independent law, but it is questionable whether this is an appropriate means of decarbonisation. At the moment, it is difficult to imagine that this process can be done to an extent that it would not only help to keep emission levels but also to deliver global emissions reduction targets without major economic and political losses.

BROAD STROKES

CULTURE & SOCIETY

COLOURFUL CHINA Noémi Eszterhainé Szőke China is a multi-ethnic state. Besides the Han majority, which makes about the 92% of the population, there are numerous other ethnic groups living in the country. With 1.3 billion people, Han is the most populous ethnic group not only in China but also in the world. Its name roots back to the Han Dynasty (206 BC–220 AC), the period regarded as China’s first golden age. Traditionally, the Han ethnic group lived along the Yangtze, the Yellow, and the Pearl Rivers, and on the northeastern part of today’s China. Besides the Han,

Yao women

Nakhi man in traditional clothing 76

CULTURE & SOCIETY

there are 55 officially recognised ethnic groups in the People’s Republic of China—five out of them (Hui, Tibetan, Uyghur, Mongol, and Zhuang) have their own autonomous region. Among the officially recognised groups, there are some which are also composed of other smaller ethnicities themselves, for example the most populous ethnic group, Zhuang, with its 17 million people. Apart from Tibet and Xinjiang Uyghur Autonomous Region, the Hans are in majority everywhere. Most of the ethnic groups can be found in the western and southwestern part of the country. Yunnan Province in the south-west has the most kinds of ethnic groups. Officially recognised ethnic minorities can use their own language in local administration, and they are represented in the local governance, as well as in the National People’s Congress.

Lahu women wearing traditional cloths (Kunming area)

51 % 9.

55 OTHER ETHNIC GROUPS

1% 0.0 N A 1% N 0.0 N BO S I A S R % RU U G U 0 . 01 Y K E 0.01% UZB BA MON 0.01% O RO Q EN

DERUNG 0.01% H E ZH E N 0. 00 5% G AO SHA N LHO 0.0 0 3 6% BA TA Z H TA RS 0.0 033 UA % NG 0.0 HU 03 2 % I

HAN

8.4%

15 .2

91.6%

The proportional relation of the majority Han and 55 other ethnic groups

8 .4

3 7. 8

% 7. 5 0

H C N UR A M YG H AO U MI YI IA J U T AN T IB E T MO NG OL

5.6 4%

5.37%

PUM I 0.0 4% AC H A NG 0.0 4% NU EV EN 0.0 3 K % I GI 0.0 N J D 3% Eâ&#x20AC;&#x2122; I N O A 0.0 N 3%

DON G BO U YE I YAO

2.59 %

2.5 8%

1.74 %

GXIA

G E L AO LAH U

SUI NAK HI Q IA

% 17 0. 3% 0.1 YZ G 2% 0.1 YR PO K G % J I N AU R 0.12 D R LA 0.11% SA NG BL A 0.09 % N M AO N A 0.05% TAJIK

1. 3

1.4

2. 51 %

1.6 4% 9%

3 1. 1%

3% 1.1

0.6

0.4 9 %

0. 5 6

0.44%

0.3 9%

0.37%

0. 2 9

0. 2

0.1 9% 0. 17 %

H K ZA AI A D K E SH U LIS NG

DON

KO BA I RE AN HA NI LI

The compared ratio of ethnic groups in China (without the Han) CULTURE & SOCIETY

CHINESE LANGUAGES

matters in a society where the spoken language was

Noémi Eszterhainé Szőke

fragmented by the numerous dialects. In order to unify

There are about 1.5 billion Chinese-speaking people

language of the People’s Republic of China in 1956.

in the world—thus it is more proper to use the Chinese language as an umbrella term, for it is as diverse and

colourful as the country itself. Besides the seven big

dialects, which are so different from each other that they can rather be considered as separate languages, there

the common language, putonghua became the official

This is the language of administration, television, and

radio programs countrywide, a lingua franca, which is

spoken—or at least understood—at a certain level by most of the people in China.

Chinese language(s) have three main characteristics.

are many small dialects and sub-dialects. The most

The first is that it is monosyllabic, which means that the

by approximately 70% of native Chinese speakers.

has a separate meaning. The second is tonality.

widespread among them is mandarin, which is spoken This dialect also includes the Beijing dialect, which

served as a base for standard Chinese, the so-called putonghua. The Mandarin language had an important

role throughout China’s history, since for centuries, it functioned as a relatively unified language of official

smallest unit of language is the syllable. Each syllable

This means that every syllable can be pronounced with several different tones, which all have different meaning. This is the biggest challenge for most of the foreign students, when they try to learn Chinese. The third is isolation, which means that words and syllables

cannot be changed; there is neither declension nor

conjugation, etc. On one hand, the lack of declination

and different grammatical cases make the language learning process easier for foreign students, but on the

other hand, it is also challenging, as the communication

context and the proper use of words in a given context is extremely important.

Written language has always played an important

role in the history of the Chinese language because the unified writing system has counteracted the divided spoken language. With more than 3,000 years,

written Chinese has the longest history among living languages. Since the 3rd century BC, writing has been regionally unified more or less, and it has also changed

less in the course of time. Of course, there have always

been several versions of written Chinese, and different forms were used in literature or by officials, etc. Despite

all that, writing has been one of the key elements of Chinese state unity. With the introduction of standard

spoken Chinese in 1956, as part of a comprehensive

reform program to eliminate illiteracy, the most often used classical Chinese characters were simplified, and the modern Chinese writing system came into life.

Similar to spoken Chinese, the basic units of written

language are syllables with individual meaning. Every

syllable has its own written character of which there are tens of thousands, but in everyday life, only about 3,500-4,000 is used regularly.

CULTURE & SOCIETY

VICE VERSA: CHINESE IN HUNGARY—HUNGARIANS IN CHINA Bernadett Hári and Viktória Anna Papp

CHINESE IN HUNGARY Chinese are currently the most numerous Asian minority group in Hungary. Some Chinese guest workers came to Hungary during the Kádár-era (translator’s note: the rule of Communist leader János Kádár, 1956–1988), but the majority of those currently in Hungary arrived in two distinct waves: in the three-year visa-free period after the regime change and at the turn of the millennium.

In the years of transition to market economy, trade with the other former Socialist countries declined, while Western companies and retailers had yet to appear. Western merchandise was too expensive and the combined effect was a relative shortage of goods. The demand for cheap Chinese products and the relatively high domestic purchasing power attracted many merchants and companies, primarily from Fujian and Zhejiang provinces in hopes of a better living. It is estimated that at this time, about 40,000 Chinese arrived to Hungary. However, the latest (2016) census data show that the number of Chinese nationals residing in Hungary is just over 13,000. The actual number may be somewhat higher, given that fluctuation is relatively high and relevant legislation was only passed in 1993. It is important to note, however, that the 2011 law on the rights of minorities does not include the Chinese among the 13 recognised national minorities, as they have not been living

Ladies of the Chinese community in Budapest dance at the 2018 Chinese New Year celebration CULTURE & SOCIETY

in the country for at least 100 years. This also means that minority rights institutions do not track their movements. According to their own terminology, the Chinese in Hungary fall into the huaqiao category, i.e. those who emigrated after the 1978 reforms but have kept their Chinese citizenship. In contrast, huayi denotes the historic Chinese diaspora. The huaqiao have closer ties with the homeland and retain the option of returning home, not least because of the fact that the People’s Republic of China does not recognise dual citizenship. Thus, the majority of Chinese residents have been in the country for almost two decades. Unlike the first generation, the second one, already born here (who call themselves xiangjiaoren or “banana people” meaning that they are yellow on the outside but white on the inside) have become an integral part of local communities. Unlike in Northern American metropolitan areas, Budapest does not have a proper Chinatown. Instead, the Hungarian capital has several smaller centres dispersed around town: Chinese mostly settled in places of interest such as Chinese shopping centres, markets, and the Hungarian–Chinese Bilingual Primary and Secondary School in the capital’s 15th district. The choice of dwelling for those intent on settling here has been influenced by a range of factors: the location of their relatives and friends already here, distance from the workplace, and the affordability of a given area. The Chinese community in Hungary has established its own “Little China.” In the above-mentioned concentrations they have all the services that make them feel “at home”: Chinese hairdressers, banks, restaurants, and practitioners of traditional Chinese medicine. The Chinese residents of Hungary also have their own media to inform them about current events, cultural programs, and holidays. There is a Chinese-language radio program, TV news program, and several newspapers. Their highest circulation newspaper is the weekly Xindaobao (“New Review”) which is free and has been published since 2000. The Hungarian–Chinese Bilingual Primary and Secondary School is unique in the region. In addition to providing tuition in their mother tongue and in line with 80

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the Chinese curriculum, it is also an important factor in preserving traditions and communityforming. The Semmelweis University also offers a training in traditional Chinese medicine, a BSc level course ran by the Heilongjiang University of Chinese Medicine. HUNGARIANS IN CHINA Learning Chinese is becoming increasingly popular in Hungary, not least due to the fact that more and more Hungarian institutions offer high-quality Chinese tuition, and scholarship opportunities to China are very attractive. Most of the Hungarians currently residing in China are students, mainly studying in Shanghai and Beijing. They generally have one- or two-year scholarships, but there are also half-year ones. In terms of employment, the image is more diverse: they are employees of multinationals, teachers, IT professionals. Many of them also take their families abroad. And there is, of course, a significant number of Hungarians working at the Embassy of Hungary in Beijing and the consulates in Shanghai, Chongqing, and Hong Kong. It is difficult to estimate the number of Hungarians living in China at any given time, but there are about 150-200 in Shanghai and 50-100 in Beijing. Additionally, several other major cities are also popular destinations: Tianjin, Jinan, and Chongqing for students, and Kanton and Hong Kong for jobseekers. But the Far East has already been popular among Hungarians in the past: many Hungarians went to China in the 20 th century and some of them not just for a short time, but even as long as several decades. Best-known among them was the architect L. E. Hudec (László Ede Hugyecz), but we should also mention the writer-painter György Román, who tried his luck in Shanghai in the 1930s, with very little success. He and his father ventured into manufacturing chocolate pellets. They failed to take into account the Chinese climate, and their merchandise went bad, so he returned home after a short detour. The Komor family settled in Shanghai in 1898: Pál Komor lived there until 1948 as an arts, jewellery, and antiques trader. In addition to being a businessman, he was also an honorary consul of Hungary. During WWI, he helped Hungarian

Shanghai, Park Hotel CULTURE & SOCIETY

prisoners of war, and in WWII Jewish refugees. László Hugyecz is unfortunately less known in Hungary, but was a renowned architect in Shanghai, where he lived and worked from 1918 to 1947. His adventurous life began in Besztercebánya (now Banská Bystrica, Slovakia), where as a young boy, he learned a lot form his architect father, György Hugyecz. He graduated at the Budapest Technical University and was looking forward to a promising career, but as WWI broke out, he was drafted into the army. The Cossacks captured him during a reconnaissance mission, and so he fell into Russian hands as a prisoner of war. Due to an injury, he was allowed to board a train of the Danish Red Cross, which was stranded due to the Russian Civil War. He managed to escape, and after a long and hard journey, he arrived in Shanghai in 1918. Shortly after his arrival, he found work at an American architectural firm and established his own company seven years later. For ease of pronunciation, he changed his name from Hugyecz to Hudec. During his career, he designed about 100 buildings, almost half of which are still standing today. In his work, he did not adhere to any particular architectural style and designed a wide variety of buildings: terraced housing, hospitals, churches, hotels, and villas. One of his most iconic buildings is the Park Hotel, which is still a symbol of Shanghai. The thoroughly modern hotel was one of the tallest buildings in Shanghai in its time. In today’s skyline dominated by skyscrapers, it still cuts a majestic figure. Hudec was honorary consul in 1942, and a year later, the Shanghai consulate was opened. During the war, he helped many persecuted Hungarian Jews. In 1947, he and his family were expelled from China, and after a short detour, he settled in the United States and never returned to China. He died in the U.S. in 1958.

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INTERVIEWS In these interviews, we asked Hungarians living in China and Chinese living in Hungary about their experiences with the host country and what motivated them to move there.

Tamás Csotye (30, employee, Shanghai) “I currently work for a trading company in Shanghai, together with my Chinese colleagues. I have been here before, when I learned the language in Tianjin and Jinan for two and a half years. I then returned home for three years. I enjoyed living in China, getting to know the culture. I love Chinese food, and that was one of the reasons why I was glad for the opportunity to work here. The city has a quite sizeable Hungarian community; they organise events every month and help the newcomers. In my experience, despite the fact that Hungary is a small country, many Chinese are knowledgeable about Hungary or can identify it at least. Being an alien in China is both easy and difficult. It is easy because the Chinese are a welcoming people, friendly and curious, and they appreciate if someone learns their language. On the other hand, it is also difficult because due to the complexity and different nature of their culture, they will still treat foreigners as outsiders even if they have a good command of the language and have been living here for a considerable time.”

Zoltán Papp (28, student, Hangzhou) “I have been studying in China for three and a half years. Currently, I study Chinese linguistics at the Zhejiang University. I will graduate in half a year and will return to Budapest. My interest for the Chinese language has not been a long one. I picked up Chinese as an optional subject mainly out of curiosity. Then I applied for a scholarship in China, and to my greatest surprise, I got it. China is very different from Hungary. Despite the cultural differences, integration was quite easy at first, but became increasingly difficult over time. In my opinion, it is easy to form a superficial relationship with the Chinese because they are so friendly, but much more difficult to acquire true friends. Should the opportunity arise, I would gladly come back here to work for a couple of years, but I cannot imagine settling for the long term or having a family here.”

Zhao Yapei (25, student, Budapest) “This is my first time in Europe. I always wanted to go abroad to live a different life than in China. Four years ago, the opportunity came to study here at the Corvinus University, and this is how

I came to Budapest. The university is good, and life is nice here. The Hungarian lifestyle is much more relaxed, not as busy as in Beijing or Shanghai. The local Chinese community acts as a sort of “bridge” between the two countries. They operate a large number of shops, restaurants, and tea parlours here, giving a glimpse of China to the Hungarians. In my experience, many Hungarians show an interest in China, but only a small number of them has a good knowledge of the country. There are also some people who don’t like the Chinese.”

Vicky Wong (24, Chinese teacher, Budapest) During my BA studies, I was a part-time teacher of a Hungarian student, and we discussed a lot about China, Hungary, and the differences between the two countries. It was this that made me come to Budapest. Life is much more relaxed here than in China. I love Budapest, and I am stunned by its beauty every time I cross the Margaret Bridge. As far as I know, there are many Chinese in Hungary, but so far, I haven’t really been in touch with them. Most Hungarians know that China is a huge country, but very few of them actually understand our culture. The locals are friendly with the Chinese, but sometimes they misread us—that is why I am here, so they can learn about China from me.”

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THE CHINESE SOFT POWER Viktória Anna Papp

The world economic position China has reached by the turn of the millennium as a result of its economic reforms has opened the stage for the country to enter an age of global power politics. After realizing that increasing hard power (i.e. political, economic, and military) alone is insufficient, around the turn of the millennium, China began the development of its soft power. Soft power is a concept introduced by Harvard professor Joseph S. Nye, referring a country’s capacity to reach its goal through persuasion and cooperation rather than by force or with money. This concept is not new in Chinese political tradition—Confucianism and Taoism already operated with similar concepts. With the rise of the country and the growth of its global economic weight soft power and the role of cultural diplomacy in foreign policy became increasingly important for the Chinese leadership, and became one of its main pillars by today. Foreign policy changes were followed by the development of soft power: while previous foreign policy was defined by Deng Xiaoping’s directive “hide your capabilities and bide your time,” in the early 2000s China announced the doctrine of “peaceful rise.” And in 2017, Xi Jinping was the first to formulate in his report as party General Secretary that “become a global leader in terms of composite national strength and international influence.” The development of the “soft power with a Chinese

Lion guarding a gate 84

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flavour” had already begun around the turn of the millennium but was only made official by Hu Jintao and the CCP’s 17th Congress in 2007. Later it was identified by Xi Jinping in 2013 as an important component of the “Chinese dream,” a vision about the rebirth of China and the restoration of its international status. They wanted to use the spread of Chinese culture, products, and values not only to counterbalance or complement hard power but also in order to stress the peaceful nature of China’s rise and to create a positive international image. In Nye’s definition, soft power usually originates from combining foreign policy, culture, and political values, but the area of what constitutes such values is not defined. Chinese soft power mainly relies on the traditional Chinese cultural heritage. China primarily interprets cultural diplomacy as building relations between people, and its developments in this field are mainly initiatives such as cultural festivals, art exhibitions, and Chinese language tuition, all of which promote understanding of the country overseas. In the past few years, the efforts to enhance soft power have become increasingly sophisticated and the palette of cultural activities has expanded. Beyond classical music, arts, and literature, the broader interpretation of Chinese soft power also includes gastronomy, traditional Chinese medicine, and the Confucian and Taoist heritage. Other factors increasing the national image include the so-called panda diplomacy and the international spread of high value-added consumer products and brands such as Huawei. These have the potential to become internationally recognised and favoured, such the American Coca-Cola or Google. It also includes organizing large and spectacular public events such as the 2008 Olympic Games or the 2010 World Exhibition. Both of these have been very successful and have undoubtedly increased global interest towards China. Chinese practice also avoids highlighting political and ideological differences: Beijing is definitely trying to implement a de-politicised soft power. They no longer portray the People’s Republic of China (PRC) as the centre of international Communism but rather the legitimate heir to Chinese culture going back millennia. There are, however, some political initiatives which, beyond the domestic public, also target an international audience and represent a

PANDA DIPLOMACY Emese Schwarcz

China’s black and white bears are surrounded by enormous worldwide interest. However, today, it is well known that pandas do not only enrich zoos in

an increasing number of countries, but they also represent China’s unique ways of diplomacy. The giant panda had been a species on the verge of

extinction for a long time—which is why it was put on the logo of WWF, but thanks to the successful efforts, their status was changed recently from

endangered to vulnerable in 2016. To save the species, China is giving pandas to zoos within a special lending

system—however since the 1950s, there are some conditions and features about the lending process which are not solely related to the animals. Just like

in the case of the Confucius Institutions, China’s

Minister is supporting the improvement of bilateral

of pandas. Although recently there are quite a lot

China regards pandas as symbols of good friendship

political guidelines are reflected in the placement

of Confucius Institutes in many countries, initially, the selection of the host countries seemed to follow

relations with China. The media makes it quite clear that and a desire for building relations.

Although China has been giving pandas to other

economic interests. The placement of giant pandas

countries in the hope of good political and economic

U.S. Deputy Secretary of State was filmed hugging

ble, hairy, non-human diplomats have become sys-

raises similar strategic questions. In 2006, when the

a panda in China, the Chinese media immediately interpreted the event as an evidence that the Deputy

connecting point with the country, such as the New Silk Road (Belt and Road Initiative). Projecting soft power also requires active channels and mechanisms through which the audience can be reached. The English language programs and publications mainly destined for foreign consumption of the Confucius Institutes and the Chinese news agencies as well as the think tanks operating abroad are all well suited for this task. The majority of these have been established in the past fifteen years. A relevant example is the Xinhua News Agency with over 150 offices around the world, with the number planned to reach 200 by the year 2020. Beyond mediating and spreading Chinese culture, they also wish to increase the impact of the Chinese narrative in a world previously dominated by the West. It is worth noting, however, that in their case, it is particularly

ties since the age of the Tang Dynasty, these adoratemic representatives of the Chinese foreign policy over the last few decades.

true that the content of soft power and cultural narrative intended for international distribution is determined by the central government. This type of cultural mission also has the drawback that it does not necessarily give a complete picture of Chinese culture—it is but a slice of a rich and diverse world. The Confucius Institutes—the largest-scale undertaking of the Asian country for the use of soft power—play an important role in creating a positive country image. Emulating the British Council, Goethe Institutes, French Institutes, and other national cultural institutes, the Confucius Institutes began to appear worldwide in the early 2000s and proved to be the most effective means of spreading Chinese language, traditions, and culture. Currently, there are over 500 Confucius Institutes around the world and their reach of the general CULTURE & SOCIETY

Statue of Confucius

public is also increasing. In 2017 alone, more than 12.7 million people attended their cultural events, ranging from the celebration of the Spring Festival through calligraphy to Chinese knotting techniques. In parallel with the institutes, Confucius Classrooms have also been established, serving a similar purpose in primary and secondary schools. The Confucius Institutes are non-profit organisations established and financed by the PRC: the annual budget of individual institutes is in the USD 10,000200,000 range while the host institutions provide the location and equipment. The institutes’ centre is in Beijing: it is the National Chinese Language Tuition Council (or Hanban, as is popularly abbreviated), which, together with the Ministry of Education, are responsible for devising and coordinating the program. The institutes are established through the cooperation of an overseas higher education institution or similar educational–cultural institute and a corresponding Chinese partner institution, with both sides required to have the Hanban’s approval and support. In recent years, the activities of the institutes have also been pulled under the umbrella of the Belt and Road Initiative, thereby promoting cooperation with the countries taking 86

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part in the initiative primarily through mutual understanding and establishing closer relations among people. While it is evident that soft power can influence political, economic, and consumer decisions, it is difficult to quantify its effect. Despite some scepticism, the results of the past two decades are undeniable. It is clear that China is committed to increase its soft power and will continue investing in it for the future. The Beijing leadership’s goal is to increase the country’s international competitiveness, appeal and influence through a soft power focused on culture, as the above remain a priority in their ambition to become a major power. However, building up the soft power of a country can take generations, and despite the USD 10 billion annual budget, the process still is in its infancy—even the Confucius Institutes have a history of just fifteen years.

CHINESE BUSINESS ETIQUETTE Bernadett Hári

Chinese culture, the thinking of Chinese people and their business protocols are fundamentally different from ours. This is the reason why in order to conduct successful negotiations and strike a good deal with company executives of the world’s second largest economy, we must be aware of these differences. But what is actually required and what factors do we have to take into account during such business meetings? We may run into difficulties even in the initial phase of first contact before any negotiations, given that Chinese people are reluctant to meet strangers. Their expression guanxi—which literally means connection—hints at this. If we wish to set up a meeting with an unfamiliar company, it pays to find an intermediary or a person already connected to that firm and can put in a good word

for us. Guanxi may be difficult to comprehend from a Western perspective—the emphasis here is on reciprocity. Personal meetings, lunches, dinners are important in China, so it is quite difficult to maintain a long-term relationship from abroad without frequent trips there. The very important incipient stage of any business meeting is the exchange of business cards. We must always hand out our business card with two hands, making sure that the bottom of the writing on it points towards the partner. The receiving person must also take the business card with two hands and must carefully read it before pocketing. As in Hungarian, Chinese names begin with the surname. Positions/titles are paramount: thus when addressing a person, we should try to always use both the surname and the title. A company head named Wang should thus be addressed as “Director Wang.” Position-hoarding is common among the Chinese, so they consider it essential to have the most possible titles on their card. The higher the positions and the larger their number is on the card, the more respect is given to the person. If possible, the business card should be double-sided, with English on one side and— provided we are in mainland China—Mandarin on the other.

We must pay attention to a number of things when exchanging business cards with our Chinese partners. CULTURE & SOCIETY

Chinese people in frequent contact with foreigners often adopt an English first name (e.g. Anne Zhao), which makes addressing them much easier. Conversely, those foreigners who have lived in China, speak the language or visit the country often also tend to adopt a Chinese first name as it is just as difficult for them to memorise a foreign (say, Hungarian) first name as it is for us to remember theirs. Greetings begin with a handshake, but it is not as firm as the European handshake. We should not expect the Chinese to bow like the Japanese, they will at most nod or bow slightly from the shoulder. Seating order is also regulated, although foreigners are not necessarily expected to follow it. If we arrive as foreigners, chances are that our place has already been designated, so we only need to follow the instructions: usually the head of a group sits in the middle, and guests are seated facing the door. If we are hosting a meeting, we should let the Chinese find their preferred seating. This way, they can sit according to their hierarchy. We must be prepared that negotiating with the Chinese is not an easy process: it requires patience and can be quite lengthy. The first meetings are almost always courtesy calls, with strong emphasis on introductions; any agreement will only come after several rounds. Eating is an important part of any business meeting, so when receiving a Chinese partner, we should always couple meetings with a lunch or dinner. Proper hospitality is very important to them and we can expect the same courtesy when being their guests. Alcohol consumption is an important part of dinners, especially for men. We must be prepared for our host to offer a toast which we must return. We should not be surprised if hot water is offered during a business meeting, as the Chinese consider hot water beneficial to health. We can also earn some points by offering Chinese guests hot water and tea. Conversely, the Chinese rarely take cold drinks or coffee, although the younger generation is more amenable to these “Western” drinks. We should always bring gifts to the first meeting: as a general rule, the Chinese will only look at the gifts after the meeting—but of course, there are exceptions. We should 88

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The most important guest

The 2nd most important guest

The host

The host’s best friend

Entrance

A seating diagram of Chinese business dinners

avoid watches as a gift, as they represent the passage of time. We should also avoid anything white or presented in fours, because the Chinese associate them with death. White is the colour of mouring while the number four spoken in Chinese only differs from death in the tone. Wrappings should be predominantly red and gold, two colours preferred in China. During any meeting, the Chinese are mainly interested in the opinion of the other side’s leader. Other participants may also speak, but the word of the leader is decisive. While this is changing, and there are already some exceptions, generally the Chinese do not speak English very well. We must therefore clarify the language of the meeting beforehand and provide interpreters if necessary. We should also be aware that the Chinese shy away from saying no, thus phrases such as “I am not certain,” “It is conceivable,” or “Maybe” usually mean “No.” After having established trust with our Chinese partner, verbal agreements and the given word are very important and taken very seriously—although there may be exceptions. Business dinners are also quite important prior to reaching a deal, but these also have their own, convoluted protocol. The way we sit down, the moments when we can

Table at a Chinese business dinner with rotating glass plate in the middle

raise our glass are important, and we should also note that those who do not consume alcohol may be at a disadvantage. Eating is very important for the Chinese. We can say with only a slight exaggeration that their entire live revolves around meals. For the same reason, food is a good and safe topic for discussion: the Chinese are very proud of their varied cuisine. If we go to China for a business meeting, the discussion will usually be followed by lunch or dinner. Chinese eat three times a day, with the meals taken from 7 to 9 in the morning, midday between 12 and 2, and from 6 to 8 in the evening. Should a meeting be scheduled to end just before one of these times (e.g. 11:30), we can expect a meal invitation. We should avoid scheduling a meeting for the above-mentioned intervals as it is generally considered rude. Business lunches and dinners usually take place in the function rooms of restaurants at a round table. Dishes are ordered by the hosts and placed in the middle of the table so everyone can sample them. Unlike in the West, individual orders are not possible. The meals are placed on a revolving glass plate in the middle of the table, and anyone can sample any food by turning it. The Chinese do not use knife and fork, but will

provide them out of courtesy for foreign guests who cannot handle chopsticks. When using chopsticks, we should pay attention to never plant them vertically in a rice mound as that would remind our hosts of the incense used at funerals. When finished eating, we should either place the chopsticks on the edge of the plate or in the chopstick holders provided in better restaurants. The most important guest or guests are seated facing the door, next to the main host. Lesser guests are seated further away from the host and main guests and nearer to the doors, in decreasing order of importance. Opposite the host and nearest to the door sits the hostâ&#x20AC;&#x2122;s best friend or sponsor who deals with the restaurant staff and handles payment. The order of the meals is also fixed: Chinese start meals with cold starters (usually vegetables), followed by the warm dishes. Side dishes are rarely ordered at business meals because normally there are many dishes, and the Chinese only eat rice if by the end of a meal, they did not have their fill. Sweets are not really customary: there is fruit instead. We should at least attempt to taste every dishâ&#x20AC;&#x201D;even those unfamiliar or not to our likingâ&#x20AC;&#x201D;as this is considered a courtesy towards the hosts. When a new dish is brought at the table, the host will place CULTURE & SOCIETY

some of it to the main guest or at least turn the round plate towards him to sample it first—another customary gesture of courtesy. Unlike in Europe, a large number of dishes are ordered at business dinners, most of which will goes to waste (more recently, the remaining food will sometimes be wrapped for takeaway, but never at formal dinners). We should always leave something on our plate at the end of the dinner, because emptying it will be a signal that we have not eaten enough, prompting the host to order another dish. Alcohol consumption is a very important part of business dinners. Those who do not drink may find themselves at a disadvantage during actual negotiations. This generally applies to men, because women who drink too much are frowned upon (although this does not necessarily apply to foreign women). Chinese mainly drink brandy (baijiu) and beer (pijiu). Their brandies are at least as strong as Hungarian ones, but their beers have a lower alcohol content. Wine is becoming increasingly popular in China, with a preference for sweet ones. Chinese are very attentive hosts and always make sure to refill their guests’ glasses. Guests should not pour their own drinks and are only expected to drink alcoholic beverages when prompted by the hosts raising their glasses, giving a toast or an encouragement to drink. Ganbei means “to the bottom” and is usually taken literally—so we should empty our glasses. With a large number of people around the table, instead of clinking, we should raise our glass then touch its bottom to the table, a gesture meant to replace clinking. We should pay attention not to raise our glass above that of the host as a sign of respect. Becoming inebriated at a dinner is not disagreeable. On the contrary: the more alcohol one drinks, the more the host will consider the evening a good one— thus drinking may be instrumental in eventually striking a deal. As previously mentioned, this primarily applies to men. Face (mianzi) is of paramount to the Chinese. This translates into prestige or authority and avoiding loss of face. This means they will do everything to avoid shame, including as hosts. If we have previously hosted our Chinese partner— maybe in our country—we can be sure that it will be reciprocated in an appropriate manner; 90

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otherwise, they will lose face in front of us. If food consumption is modest or the guest does not drink enough, does not enjoy the dinner, that is also a loss of face for the host. Presents are another example of the loss of face. At the first meeting, Chinese will generally offer a present to their counterpart, and we can expect an item of quality, representative of Chinese culture wrapped with great care. Anything else would also result in a loss of face for our Chinese partner. We should always make sure that the value of our present must not be significantly higher than the one we received, as this would also result in a loss of face for the host. We could go on and on with examples, as Chinese take their face and the loss of it very seriously, both in their private and professional lives. The above examples primarily apply to more formal business dinners. As China is a huge country, we should be prepared for regional variations or different customs. However, if we do our homework before visiting and pay attention to these customs during business dinner, our efforts will certainly be appreciated by our Chinese hosts. They will of course not expect a foreigner to be familiar with and observe all their customs and will not be offended should we fail in some respect. But a little attention to these details can significantly speed up the otherwise long and convoluted process of business negotiations. As we have seen above, we must pay attention to many details if we wish to establish a successful business relationship with a Chinese partner. It pays to inform ourselves before the meeting about the specific customs and ways of thinking, as our Chinese hosts will surely appreciate the thoughtfulness, paving the way for a long-term and harmonious partnership.

CHINESE HIGHER EDUCATION: IS BEIJING UNIVERSITY THE HARVARD OF THE FUTURE? Noémi Eszterhainé Szőke

Education has always played an important role all through the long history of China because it ensured highly qualified bureaucrats who were essential for the effective operation of the state. The civil service exam in Imperial China used to be famous for being very demanding: only the most talented students were chosen to work in ministries or at the imperial court out of millions. However, by the end of the 19th and the beginning of the 20 th century, it became more and more evident that the knowledge ensured by the once effective education and examination system, based on mostly classical texts and works of philosophy and ethics, could meet the expectations of the modern world less and less. After identifying this tendency, the reform of the existing prominent educational institutions (e.g. Wuhan University, 1893; Peking University, 1898) and the establishment of new ones (Fudan University, 1905; Tsinghua University, 1911) started, according to the western model. Thus, Chinese institutions could offer qualifications which were suitable for the technical and scientific expectations of modern times. Education, especially higher education was granted a special importance in the policy launched by Deng Xiaoping in 1978, called reform and opening-up, which aimed at developing Chinese society and economy. Realizing the society- and economy-changing power of skilled workforce, the first step was to enable more and more people to get a degree in higher education. THE CHARACTERISTICS OF CHINESE HIGHER EDUCATION The core of Chinese higher education—similarly to Western universities—is built up on graduate and postgraduate programs. Programs at the graduate

or BA level are usually 4 years long. These are followed by a 2- or 3-year-long MA and a 3-yearlong PhD programme. Besides these, there are many different vocational programs, postgraduate training courses, while on a few specific fields (e.g. medical science, engineer training, music) programs remained undivided. The structure of higher education is highly centralised, most of the institutions are state-owned (directly coordinated by the Ministry of Education or the provincial government). However, since the announcement of the reform and opening-up, by a series of reform programs, the government has constantly been aspiring to work out a flexible system which suits local needs better. The basic idea is that the government should control macro level planning, while on local level, institutions would have greater control over micro planning, management, and local alternatives. The financial background of institutions is made up of state and non-state resources. The former takes about the 60% of the total budget, and the rest is mostly raised through tuition fees, and in a smaller proportion, through donations and private investments. Currently, the annual spending on education is slightly more than 4% of the GDP (the OECD average is around 4.5%), but the long-term goal is to raise the role of non-state financial sources, especially in higher education. Everyone has to pay tuition fee in the Chinese higher education. The amount differs in each university, but it is fairly reasonable, and follows the average salaries. Disadvantaged students are supported by scholarships and subsidised loan schemes. There are private institutions as well, but their quality of education is often behind the stateowned ones because they tend to enrol students who due to their lower grades, are not admitted to public institutions and cannot afford studying abroad either. One of the most remarkable characteristics of the Chinese education system is the extremely difficult academic entrance examination, the so-called gaokao (“high exam”), which is an unavoidable prerequisite for being accepted by almost all higher education institutions, except for several private ones, at the undergraduate level. The exam has been in force in its present CULTURE & SOCIETY

Preparing for the academic examination requires great effort from secondary school students

form since 1977. Gaokao is an infamously difficult exam that requires memorizing huge amounts of theoretical knowledge, and in most of the provinces, it is organised only once a year. Students prepare for this single exam for years, putting a lot of effort into it, since millions fight for the available higher education places year by year: in 2017 nearly 9.5 million student took the exam and 3.72 million got admission to universities. Besides the three compulsory subjects (Chinese, mathematics, and a foreign language), students have to take exams in three additional subjects in the field of science or social sciences, depending on the focus of their further education. The maximum reachable and minimum entry points differ in every province, and universities also define their entry requirements which are higher in case of better institutions. In addition, universities have their individual quota plans regarding the number of students they can receive from a given province or region. So, beyond educational performance, a lot depends on which province the students come from (what kind of household registration, or hukou they have), and how fierce the competition is. Students living in provinces and regions with a bigger number of top institutions have much better chance to be accepted by one of them. The enrolment quota of institutions does not depend on the population of the region but on their own plans. There is usually a fixed quota for each region, which is higher in case of their home province. In some of the densely populated provinces, competition is very intense, while in other regions, e.g. Beijing or Shanghai which are direct-controlled, province-level municipalities, the number of institutions with good reputation is 92

CULTURE & SOCIETY

A group of graduate students at Peking University

higher, and students born in these regions have more chance to study at a good university. So, it can happen that a student of a given province is only able to go to a weaker university, while another region’s student with similar gaokao results can go to one of the top institutions. Due to this, between 2009 and 2014, the 97% of the poorest counties did not send students to Tsinghua University. REFORMS In order to enhance the quality of higher education, there have been three important reform projects in the last three decades. The first, in 1992, was named “211.” The number, on one hand, refers to the 21th century, and on the other hand, it signs the one hundred and more higher education institutions that participated in it. The main goal of this program was to improve the quality of education and research in these institutions, which could also serve as a base for the social and economic developments of the future. In 1998, related to the “211” project, another grand higher education reform program, the “985” (a name referring to the date of the reform) was launched, which granted additional financial support to 39 institutions out of the “211” in order to turn them into competitive institutions in the fields of science and technology on global level . The scale of the program is well represented by the fact that between 2009 and 2013 the selected 39 institutions received RMB 13.9 billion government support (which is more than USD 13 million/year/ institution), the other 73 “211” institutions received RMB 5.1 billion, while 670 institutions outside the program received only RMB 7.9 billion in total. Thanks to the reforms, higher education in China has gone through a huge transformation.

Number of enrolments at undergraduate higher education level 8000000 7000000 6000000 5000000 4000000 3000000 2000000

2014

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1000000

Number of traditional higher educational institutions 3000

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Number of Regular Students for Normal Courses in HEIs by Discipline, 2016 Philosophy 0%

Engineering 29%

History 1%

Agriculture 2% Law Education 3% 3% Foreign Languages 4% Economics 5% Science 6%

Health 7%

Literature 8%

Administration 16%

Art 8%

Teacher Training 8%

By the second half of the 1990s, the number of students enrolled in higher education has dramatically increased. At the time when the reform and opening-up was launched, about 1.55 % of the people at higher education age attended a university, while now this rate is over 40%, and it is estimated to reach 50% by 2019. The number of undergraduate students has increased tenfold during the past twenty years.

It was only possible because there has been a remarkable increase in the number of higher education institutions as well. Today, in total, there are about 37 million students in Chinese higher education. About 7 million students graduated in 2017, twice as much as in the U.S. It is worth mentioning that unlike in many other parts of the world, interest in IT, science, and technology programs is not at all low in China. In 2016, 4.6 million students graduated in these fields, and the government aims to further support these programs to boost Chinaâ&#x20AC;&#x2122;s transformation into an innovative society. According to the forecasts, the number of graduates in these fields will be the highest in the world by 2030. In view of quantity indicators, Chinese higher education is already the number one in the world. At the same time, quality improvement could not keep pace with the quantitative growth. On one hand, there are big differences within the country itself regarding the quality of the programs of different institutions, while on the other hand, Chinese higher education institutions are still underrepresented globally. Currently two Chinese universities, Peking (number 27) and Tsinghua (number 30) can be found among the worldâ&#x20AC;&#x2122;s top 100 universities. Realizing the challenge that quality development is also needed, the Chinese government announced its third big reform program in 2015: it aims to double the number of top universities and international training programs. As part of the reform, 42 universities were chosen to be developed to join the top universities of the world, and further 95 institutions were selected to start world-class training programs. The extent of financial support for research and development is well represented by that Tsinghua received about USD 290 million central and local governmental support in 2016 and an additional USD 29 million from the National Social Sciences Fund. This equals to the 37% of the total 2017 government spending on higher education in Hungary. The strategic importance of higher education emphasised by the announcement of reform and opening-up is still relevant. At the 19 th National Congress of the Communist Party, held in October 2017, president Xi Jinping mentioned the importance of education in his CULTURE & SOCIETY

THE FOUR CLASSIC NOVELS OF CHINESE

Buddhist monk Xuanzan, Sun Wukong (the Monkey

Viktória Anna Papp

Prohibitions and Friar Sand, on a quest for the holy

LITERATURE (SIDAMINGZHU)

Besides being universally known in China, the four

key novels of classic Chinese literature have had and still have an enormous influence on other works and have seen innumerable adaptations in movies, theatre

plays, and TV shows. A common characteristic of these novels is that they were not written in traditional

King), and their two companions, Pig of the Eight writings of Buddha. The novel has also inspired

Hungarian poet Lőrinc Szabó’s poem Szun Vu Kung Lázadása (“The Revolt of Sun Wukong”). The Dream

of the Red Chamber is a novel about love and court

intrigue by Cao Xueqin, offering a vivid and detailed portrayal of 18th century social and cultural life.

literary Chinese but rather the spoken language of

their respective times, thus offering us a faithful representation of their eras’ spirit and political and social environment. Water Margin is the earliest of the four, a loose collection of episodes depicting the

outcasts of society forming an independent group to

fight against the Song imperial troops. Both Water

Margin and the Romance of the Three Kingdoms are wuxia novels, a genre depicting the adventures of ancient martial artists. The Romance of the Three

Kingdoms is a description of the political and military conflicts and battles between the kingdoms of Wei

led by Cao Cao, Shu led by Liu Bei and Wu, led by Sun Chuan. Journey to the West or The Legend of

the Monkey King by Wu Cheng’en is the story of the

Sun Wukong, the Monkey King

CULTURE & SOCIETY

A scene from Water Margin: Wu Song fights the man-eating tiger

speech as one of the key factors of the further development of the country and as an important element of Chinaâ&#x20AC;&#x2122;s international recognition and increasing soft power. Quality enhancement and wider international recognition is served by the steps taken toward the internationalisation of Chinese higher education. In the recent years, the government has been eager to support this tendency by enabling scholarships and exchange programs. The number of foreign students has been remarkably increased: currently, there are about 442,000 international students studying in China from 205 countries around the world; for a comparison, this number was only about 55,000 in 2006. 11% of these students is supported by Chinese government scholarships. There are approximately 545,000 Chinese students studying abroad, but most of them pay for their own tuition. The most popular target countries are the U.S., Great Britain, Australia, and Germany. THE FUTURE Chinese higher education has dramatically improved in the last decades. Presently, the undergraduate level of higher education is available for a wide range of the population. However, massification and some elements of the traditional Chinese education still challenge the government. There is a sharp difference between the actual knowledge and skills of fresh graduates and the labour market demands. Some typical elements of traditional Chinese education (mugging, the lack of encouragement for creative thinking and real-life experience) have negative effects on the chances of Chinese students to find a job in fields which require complex and global approaches. It is not a big problem in case of jobs which mainly require theoretical knowledge or hard skills, such as IT and natural sciences, but it can be a serious challenge in case of positions which require soft skills (communication and management skills, analytical thinking). Another problem is the quality difference between top and average universities in China. Even the first big reform programs aimed at the development of selected institutionsâ&#x20AC;&#x201D;8 institutions out of the 42 selected in the 2015 reform are

located in Beijing and another 6 in Shanghai, while most of the rest is also located in the more developed eastern coastal region of the country. For at least the partial solution of this problem, the best universities try to help weaker institutions through partnership agreements, granting them access to special equipment and development plans. It is hard to tell whether the successful quantity improvement of higher education in China will be followed by quality improvement because there are often less visible, years-long local attempts for improvement besides the country-wide reform programs. As part of these projects, the government directs provinces to reform selected areas (e.g. the content of entrance examinations, the structure of training programs, etc.) of the higher education. In this case, provinces get free hand in building and testing their programs, and successful development schemes can later be applied in other provinces and regions. There is no lack of determination, money, and ideas in China, so it can easily happen that by the mid-century, Chinese universities will be as attractive as prominent Western European or American institutions in the eyes of the students who consider studying abroad.

CULTURE & SOCIETY

CHINESE HOLIDAYS— TRADITIONS, CULTURE, AND DEVELOPMENT Dr Li Lei and Zhang Zhao

Chinese culture has developed a sophisticated festival culture system. There are four most important festivals in the Chinese calendar, namely the Spring Festival, the Qingming Festival, the Dragon Boat Festival, and the Mid-Autumn Festival. On 16 December 2007, with China’s State Council passing the new “National Holiday Policy,” the Qingming Festival, the Dragon Boat Festival, and the Mid-Autumn Festival became the national holidays. The population highly values New Year’s Eve, Spring Festival, Lantern Festival, Qingming Festival, Dragon Boat Festival, Qixi Festival, MidAutumn Festival, and Double Ninth Festival.

Decorated portal for the Spring Festival 96

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I. CHINESE TRADITIONAL FESTIVALS IN THREE THOUSAND YEARS The traditional Chinese festivals are the continuous practice and vivid manifestation of Chinese historical memory and cultural accumulation. The ancestors gradually formed the concept of the natural cycle and time, regarding them with reverence on the basis of long-term insight into the universe. In the face of the immenseness of nature and universe, people started to think about the meaning of life by marking points in time and developing religious and folk rituals in relevance to peace and harvest in festivals. This helps to form a systematic chronicle of festivals with colourful meanings. Chinese traditional festivals are rooted in ancient farming culture. The most traditional Chinese festival, the Spring Festival, was called zai during the Yu dynasty, sui during the Xia dynasty, nian during the Zhou dynasty. Zai, nian, and sui all refer to the grain growth cycle. The crops are ripe once a year, so the Spring Festival happens once a year and bears the meaning of harvest. The Qingming Festival is one of the twenty-four solar terms. During the Qingming Festival, China’s

climate becomes warm and plants start flourishing. People begin agricultural work at the time. There is a rural proverb in the south of the Yangtze River: “The Qingming and Guyu are coming soon, let us do some farming quickly,” or another: “Plant trees before Qingming.” The origin of the Mid-Autumn Festival, held on the 15th day of the 8th month in the lunar calendar, is related to the maturing time of rice. People like socializing and watching the full moon together to celebrate a good harvest during this holiday. In a year’s time, Chinese traditional festivals follow each other according to the agricultural cycles with planting in spring, cultivating in summer, harvesting in autumn, and accumulating in winter, enriching the Chinese cultural development. II. THE FAMOUS CHINESE TRADITIONAL FESTIVALS 1. Spring Festival Chinese New Year or Spring Festival is China’s most important festival and holiday. The Spring Festival falls on the 1st day of the 1st lunar month, which often comes one month later than in the Gregorian calendar.

All people living away travel home for the holiday; hence, the half a month period around the Spring Festival is the busiest time for transportation systems. Airports, railway stations, and longdistance coach stations are crowded with homebound Chinese. The 23rd day of the 12th lunar month is called the Preliminary Eve. People offer sacrifice to the Kitchen God on this day. Before the New Year comes, people completely clean the indoors and outdoors of their homes, wash their clothes, bedclothes, and all their utensils. All the door panels are pasted with Spring Festival couplets, displaying Chinese calligraphic signs with black characters on red background. The content varies from house owners’ wishes for a bright future to good luck wishes for the New Year. Pictures of the Door Gods and the God of Wealth are also hung on front doors to ward off evil spirits and welcome peace and abundance. The Chinese character “fu” (meaning blessing or happiness) is a must. The character put on paper can be pasted normally or upside down, for in Chinese the “reversed fu” is homophonic

Dragon Boat Race in Foshan CULTURE & SOCIETY

with “fu comes,” both being pronounced as “fudaole.” Apart from that, two big red lanterns can be placed on both sides of the front door. Red paper-cuttings can be seen on window glasses and brightly coloured New Year paintings with auspicious meanings may be put on the walls. People attach great importance to the Spring Festival Eve. Every family gathers to eat dinner together on this day. The meal is more luxurious than usual. After the dinner, the whole family will spend time together, chatting and watching TV. In recent years, the Spring Festival Gala broadcasted by China Central Television Station (CCTV) is an essential entertainment for the Chinese both at home and abroad. According to the custom, each family stays up to see the New Year arrive. After waking up on New Year’s Day, everybody puts on his or her best clothes. First, they extend their best wishes to their parents, then each child gets some money as a New Year’s gift wrapped up in red paper (hongbao). People in northern China will eat jiaozi, or dumplings for breakfast, as they think the jiaozi dumpling resembles a gold ingot from ancient China. Therefore, people eat them and wish for money and treasure. Burning fireworks was once the most typical custom in the Spring Festival. People thought the spluttering sound could help drive evil spirits away. The lively atmosphere not only fills every household but permeates into the streets too. A series of activities such as lion dancing, dragon lantern dancing, lantern festivals, and temple fairs go on for days. The Spring Festival ends with the Chinese Lantern Festival, which is held on the 15th day of the 1st lunar month. 2. Qingming Festival The Qingming Festival is one of the 24 seasonal division points in China, falling between 4 and 6 April every year. Tomb-sweeping is regarded as the most important custom in the Qingming Festival from which the name of Tomb-Sweeping Day derives. Cleaning the tombs and paying tribute to the dead by offerings are the two important elements of remembering the past relatives. The dead 98

CULTURE & SOCIETY

person’s favourite food and wine are placed on the tomb for them along with paper scraps resembling money. This is all burned then in the hope that the deceased is not in lack of food and money. Today, with cremation taking over burying, the custom has been extremely simplified in cities, and only flowers are presented to the dead relatives and revolutionary martyrs. Not only is it a day for commemorating the dead, but it is also a time for people to enjoy themselves. Everything in nature puts on a new look, as trees turn green, flowers blossom. So, visitors can be seen everywhere during the month of the festival. It is a fine time to go out and to appreciate the beautiful scenes of nature. 3. The Dragon Boat Festival The Dragon Boat Festival, the 5th day of the 5th lunar month, has a history of more than 2,000 years. It usually takes place in June in the Gregorian calendar. Allegedly, Qu Yuan, a poet, a minister, and a counsellor of King Huai of Chu during the Warring States period, was the originator of the festival. Legend has it that Qu’s outstanding success at the court made his rivals envy him so much that they defamed him before the emperor. King Huai believed the accusations and expelled Qu from the court—but Qu, still being loyal to the emperor, threw himself into the river instead. The villagers nearby rushed for his help with their boats carrying rice dumplings, and although they tried to save him desperately, they were too late. The villagers then beat drums and splashed the water with their paddles in order to keep fish and evil spirits away from Qu’s body. To remember the loyal poet, the Chinese hold dragon boat races throughout the country and eat zongzi, a glutinous rice wrapped in bamboo or reed leaves, during the Dragon Boat Festival. The dragon boat racing event is held every year in different places of China. The activity is more popular in southern China, where there is an abundance of rivers and lakes. During the Dragon Boat Festival, it is a very important custom to hang calamus and wormwood clusters on the doorframe. Both calamus and wormwood releases an aroma that can repel pests.

HARMONY IN DIVERSITY—WESTERN FESTIVALS

gifts to each other on this day to express love. Men mostly

Dr Li Lei and Zhang Zhao

give men chocolate, watches, or ties. People often go to

IN CHINA

In the globalised era, festivals are becoming the means

that facilitate intercultural communication across the

give women flowers or jewelry as a gift. Women usually restaurants to have a candlelit dinner. A dinner date on Valentine’s Day is usually the key to the development of the love relationship between couples.

On the day, many men propose to their girlfriends,

globe. The opening China embraces Western festivals

and many couples also choose to register their marriage

the Chinese society.

with the Lunar New Year’s Lantern Festival, which is an

and reshapes them according to the unique features of

on this day. On 14 February 2014, the day coincided

ancient Chinese Valentine’s Day, that has turned into a

Localised Christmas

holiday of family gathering. The concurrence of these

literally meaning the peaceful and reassuring night. The

cultural connotation to the festivals in 2014. What is more,

In China, Christmas Eve is translated as “Ping’an Ye,”

translation adds a connotation to the meaning of the festival, which is in line with China’s ancient Confucian tradition of harmony. The same way Westerners celebrate

Christmas Eve, Chinese friends and relatives also gather

two festivals of East and West added an even deeper

“2014214” has become a very popular phrase for the two festivals since its Chinese pronunciation is similar to “love you forever.”

Besides the above, Mother’s Day, Halloween, and

on the day; however, the Chinese have developed a local

Thanksgiving Day are also becoming more and more

The local idea of the “Christmas apple” is based on the

festivals is intercultural communication across borders

tradition of giving apples to each other.

Chinese translation, “Ping’an Ye.” The pronunciation of

“apple” in Chinese is pingguo, which is similar to ping’an

that means peace. This is how apples become a local cultural symbol of wishing each other the best. It can

be deemed as a creative cultural practice but also an extension of local cultural tradition. The Chinese believe

that receiving an apple on Christmas Eve will bring peace and harmony to them.

Many parents buy a Christmas tree for their children

to wish them good health, strength, and energy. In the

morning of Christmas, some parents, alike in the Western countries, prepare gifts for their children in secret.

Christmas also contributes to the market. The main

commercial streets and shopping malls in many cities

are beautifully decorated from early December, and

popular. What contributes to the import of Western

becoming more frequent, China’s developing economy, and the improving living standard in the country. The Chinese make those festivals local by adding elements of Chinese traditional culture to them, which further

diversifies the society of China. At the same time, the opening China has a better understanding of the

outside world and can explore the universalities among human beings from different backgrounds. Love, peace,

gathering, happiness, and the hope for a brighter future are the common values which appear in both the Western

and Chinese culture of festivals, indicating that there is universal consensus about how we see life and that

people pursue common values regardless of which part of the world they live in.

the oncoming period is called “Christmas season.” Consumption driven by the festival covers a wide

range of industries from retail through film to catering.

Many shopping centers are open until midnight in the Christmas season. This way, Christmas in China is like a shopping carnival.

Another Version of Romance

With the development of globalisation, many Chinese

also celebrate Valentine’s Day now. People in China send

Valentine’s Day is very popular among the Chinese youth

CULTURE & SOCIETY

People traditionally make perfume pouches, a small cloth bag stuffed with vanilla, herbs, realgar and flower petals for the holiday and carry them on their belts or in their pockets. With a nice fragrance, perfume pouches are considered to have positive effects on health. 4. The Qixi Festival Falling on the 7th day of the 7th lunar month, the Double Seventh Festival in China, also known as Qixi Festival, is what Valentine’s Day is to the Western countries. As it is a day of great importance for girls, the event is also called the Young Girls’ Festival. The festival has been endowed with the meaning of great romance because of the beautiful legend about Niu Lang, a cowherd, and Zhi Nu, the heavenly weaving girl living in the other side of the Milky Way. The couple can meet only once a year, on the 7th day of the 7th lunar month, when a flock of magpies would form a bridge to reunite the lovers for one day. Particularly in recent years, with the promotion of shops, urban youth have celebrated it as the Chinese Valentine’s Day. It is now becoming a day of showing love and not a festival about a sad love

story among the Chinese youth. Young people and young couples go for a date and spend a romantic day together in the same way as young people in western countries celebrate Valentine’s Day. They give gifts or flowers to each other. 5. The Mid-Autumn Festival The Mid-Autumn Festival falls on the 15th day of the 8th lunar month, usually in October in the Gregorian calendar. People chose to celebrate it on 15 August, because it is the season when crops and fruits are all ripe and the weather is usually pleasant. On the day of the festival, family members gather to offer sacrifice to the moon, appreciate the bright full moon, eat moon cakes (yuebing), talk about life, their love and longing for a better life and express strong yearnings toward family members and friends who live afar. III. THE UNIQUE CULTURAL CONNOTATION OF CHINESE TRADITIONAL FESTIVALS Traditional Chinese festivals, as the carriers of culture, are about traditional values of loyalty, responsibility, diligence, and harmony. Year

During the Qingming Festival paper money printed for this occasion is being burned 100

CULTURE & SOCIETY

after year, the Chinese pass on these values and morals to the next generation during the festival.

with nature, people pray so that the New Year will bring good harvest, peace, and security.

1. Loyalty and Righteousness Loyalty and righteousness are two of the core concepts in traditional Chinese morality. The concept of loyalty can be traced back to ancient times. Due to the implementation of the hereditary system of patriarchal clan rule, the king–subject relation and parent–child relation are in line with each other. People incorporated the two “relations,” so loyalty and righteousness are deemed as a totality. In traditional Chinese festivals, the honour and remembrance of heroes (e.g. Qu Yuan), namely the pursuit of loyalty and righteousness, is one of the most important contents. The memory of heroes and their merits are passed on to the next generations by the festivals. Loyalty and righteousness have been appreciated by the educated class of officials in China and has become a core value for them. The merits originating from family–nation relations call on countless people to serve the country and its population.

3.Harmony and Beauty Harmony is the moral that has been practiced and advocated by the Chinese for thousands of years. Harmony and beauty mean reunion and coronation, which is one of the basic spirits in the Chinese culture, especially in case of traditional festivals. Although the Spring Festival is the first day of the lunar year, people mostly celebrate it from the lunar December in the old year to the 15th of the lunar January in the New Year. During lunar December, people clean their houses, worship the Kitchen God, and families reunite on the lunar New Year’s Eve. Family members make dumplings together. Processing flour and dumplings have the connotation of smoothly entering the New Year together. In the time of the Lantern Festival, family members eat sweet soup balls, expressing the people’s hope for a happy reunion and harmony. The Qixi Festival expresses people’s hope for a happy marriage. The mooncakes in the MidAutumn festival show people’s hope for reunion. In addition, the Qingming willows and cattails, and the Double Ninth cornel all indicate people’s pursuit of harmony and beauty. Traditional Chinese festival culture is an important part of the Chinese cultural heritage. It enriches the connotations of Chinese folk culture and represents people’s collective historical memory. The values embodied in those festivals can contribute to Chinese wisdom, global diversity, and global governance. Those values, including loyalty and righteousness, “unity between humans and nature,” harmony and beauty, united diverse beauty, emphasise the harmony between humans and nature, among nations, which is a valuable knowledge in the current world. In this sense, we believe that ancient and continuous traditional Chinese festivals will sustain their vigour and vitality and constantly contribute to the development and flourishing of the Chinese and other peoples all over the world.

2. Nature and Humanity The idea of nature and humanity was put forward by Confucian scholar Dong Zhongshu about 2,000 years ago. Traditionally, Chinese imagine the universe as a big world and the human society as a small world. Essentially, humans and nature are interlinked, so people should follow the rules of nature and reach a balance between nature and humanity. “The unity of heaven and man” is the combination of nature returning to the essence of life. The most basic meaning of the “unity of heaven and man” is to fully affirm “the unity of nature and spirit.” People celebrate traditional festivals for different purposes and in different ways. During the Spring Festival, people name days as rooster day, dog day, pig day, horse day, ox day, goat day, human day, grain day, heaven day, and stone day. Those designations embody the respect people have towards nature. People believe that “if they worship nature, it will treat them well.” In this month-long dialogue

CULTURE & SOCIETY

101

CHINESE FILM INDUSTRY— PAST, PRESENT, AND FUTURE Noémi Eszterhainé Szőke

Film-making in China has a long history. The first Chinese movie was shot in 1905, and in the following years, film-making grew into a separate industry in the country. The centre of Chinese cinema was Shanghai (sometimes also called as Hollywood of the Far East) and Hong Kong. The first golden age of Chinese film-making was in the 1920s and 1930s, which came to an end with the Japanese invasion of the country. After the long war years, Chinese film industry revived, and by the end of the 1940s, millions

The legendary Bruce Lee 102

CULTURE & SOCIETY

of viewers bought cinema tickets. The topics of mainland Chinese movies were typically inspired by Socialist Realism in this period. The most emblematic movies of the Hong Kong film industry were martial art or so-called wuxia films. These films were the first to bring worldwide recognition to Chinese actors. In spite of his tragically short career, Bruce Lee, who first appeared on the screen in the early 1970s, quickly became one of the icons of the 20 th century. He revolutionised wuxia movies (besides stories taking place in historic times, plots of modern heroes appeared) and made martial art films and martial art itself popular worldwide. Another famous figure of wuxia movies is Jackie Chan, who became popular with his kung fu comedies, and made a successful Hollywood career. Similarly, Jet Li became first well-known in China, then in other parts of the world with wuxia films. Apart from martial art movies, triad movies also characterise the Hong Kong film industry. The genre has been popular in China

and worldwide ever since John Woo’s A better tomorrow (Ying hung boon sik, 1986). The 1980s can be regarded as a milestone in Chinese film-making, for the works of the so-called Fifth Generation directors, who emerged during the decade, first brought significant attention to mainland Chinese movies abroad: more and more productions earned success at international film festivals. The series of international successes started when Red Sorghum (Hong gaoliang, 1987) by the still very active Zhang Yimou, best-know of his generation, won the Golden Bear award. This was followed by numerous other recognitions: Ju Dou (1990) and Raise the Red Lantern (Da hong denglong gaogao gua, 1991) were nominated to the Academy Awards, while The Story of Qiu Ju (Qiu Ju da guan si, 1992) won the Golden Lion. Chen Kaige’s 1993 movie, Farewell My Concubine (Bawang bie ji), won the Golden Palm. Most of these films feature the muse of the Fifth Generation, Gong Li.

Gong Li, the muse of the Fifth Generation of filmmakers is still a big star today

In the second half of the 1990s, the Sixth Generation of filmmakers appeared on the scene. Their work was characterised by low budget movies, amateur actors, unconventionalism, daring topics, and strong social criticism. Although it was not the recognition of critics’ and the wider audience that motivated them, many of their works—for example, Wang Xiaoshuai’s Beijing Bicycle (Shiqi sui de dan che, 2001) and Shanghai Dreams (Qinghong, 2005), or Jia Zhangke’s Still life (Sanxia haoren) in 2006— were well received. The 1990s brought changes to the Chinese film industry not only from an artistic but from a financial aspect too. Thanks to director Feng Xiaogang’s new marketing strategy, by the second half of the decade, the first Chinese blockbusters, the so-called hesui pian (Chinese New Year) films, appeared. These films typically target a wider audience, and their release date is always around the New Year festive period. Hesui pian movies have produced enormous revenues for the Chinese film industry, and by the early 2000s, Chinese movies started matching Hollywood productions by their financial weight in the global market. Besides domestic blockbusters, this period also saw the first internationally recognised and financially successful movies produced. The pioneering one was Ang Lee’s Crouching Tiger, Hidden Dragon (Wo hu cang long, 2000), which was followed by Zhang Yimou’s Hero (Yingxiong). The former won four Academy Awards and has been the most commercially successful foreign-language film in the US. Both movies were made in Chinese– American co-production and are spectacular representatives of the wuxia, which feature the whole elite of Chinese film-making and music production. The success of Crouching Tiger, Hidden Dragon and Hero encouraged numerous similar high-budget super productions to follow one after another. The changes that the Chinese film industry saw in the recent decades have already had palpable effect on the global film industry. Western film studios cannot neglect the Chinese market anymore, neither can they ignore the expectations of the Chinese audience, as it is the second largest market worldwide by ticket CULTURE & SOCIETY

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sales (for example, in 2016, the weekly box office results hit a record in China with USD 557 million worth tickets sold). As the domestic market in the US started shrinking, Hollywood film-making, which has played a leading role in the global film industry throughout the 20th century, is leaning more and more on the expanding Chinese market. Due to this tendency, many Chinese– American co-productions have been made in the last several years in a way that their target market was not necessarily the US, but the Far Eastern giant. The 2016 Warcraft made only USD 25 million in its premier week in the USA, while it brought USD 156 million in China. Apart from co-productions, big Chinese companies like Alibaba or Tencent, have also invested enormous amounts into the American film industry in the recent years. The private property developer and largest cinema chain holder Dalian Wanda acquired Legendary Entertainment in 2016, which has produced blockbusters like Jurassic World, Christopher Nolan’s popular Batman Trilogy, and Interstellar. By this, the company has further increased its

already huge interests in the global film industry after purchasing market-leading American, European, and Australian cinema chains, such as AMC Entertainment, Odeon&UCI, and Hoyst, in the beginning of the 2010s. The good prospects of Chinese film-making are ensured by the fact that the industry is technically self-sufficient: it has all the necessary professionals and big, modern studios with the latest equipment (the world’s largest film studio— the Hengdian Studios, established in 1996, with its 330 hectares surpasses the combined size of the Paramount and the Universal studios— can also be found in China), while it also has a domestic market big enough to maintain the industry. In the recent years, the most successful Chinese movies, such as Monster Hunt (Zhuo yao ji, 2015) with USD 385 million, The Mermaid (Mei ren yu, 2016) with USD 554 million, and the new record-holder, Wolf Warrior 2 (Zhan lang 2, 2017: 2, 2017) with USD 874 million revenue, were all 100% domestic productions. This tendency is further propelled by the fact that the share of Hollywood movies in the expanding Chinese film

In the world’s biggest film studio, the Hengdian Studios, even a copy of the Forbidden City can be found 104

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MODERN CHINESE MUSIC Noémi Eszterhainé Szőke

When it comes to Chinese music, it is often a musician

playing a traditional pentatonic melody or a colourfully

dressed opera singer that comes to one’s mind. But after the announcement of its “reform and opening-up,”

music life in China also became invigorated, and by today, it has become unbelievably diverse. Besides pop music, rock, metal, and punk have also become

very popular since the end of the 1980s. In the

beginning, foreign albums dominated the market, but domestic bands soon appeared. Nowadays, any kind

of music style that exists in Western countries can be

found in China too. Rap, soul, and R&B have been particularly popular in the recent years. Chinese music

life is characterised by a vivid club life, big festivals (the most famous among them is Midi Music Festival, first organised in 1997), and county-wide popular talent shows which attract hundreds of millions of viewers. Today, China is one of the musical centres of the world,

with the biggest light music market. Along with light music, classical music has also gained ground in

The extravagant pianist, Lang Lang

China. Learning classical music and the enhancement

Although playing Western classical music has

government, and competing parents are also eager

financial resources invested in the last few decades

of musical literacy is strongly supported by the central to provide their children with some level of classical

music education. Piano is the most popular instrument; by estimated numbers, there are about 35-40 million

students learning to play the piano in China today.

no long history in China, the intensive efforts and have started to bear fruit. Globally recognised

artists, such as the Academic Awards winner music

composer Tan Dun, or the extravagant pianist Lang Lang prove this well.

market has continuously decreased: from 49% in 2012 to 32% in 2017. The Chinese film industry has become internationally fully acclaimed and has bright future ahead. Although it is unlikely that Chinese movies will dominate the global film market at such an extent as US productions, it is sure, that the Chinese taste, style, and the demands of the Chinese market will strongly shape the film industry of the future. Using Chinese actors or shooting locations in Western movies can boost box office revenues, which will likely make a huge effect on global film market, especially in the case of block-buster movies.

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TOP

Innovative Companies

Tencent The name of the internet service company, established in 1998, is probably not as wellknown as Alibabaâ&#x20AC;&#x2122;s, however it is the 5th most valuable company in the world. It invented applications such as the Chinese messenger QQ or WeChat, which has around a billion active users, as well as several popular online, mobile, and PC games. In 2017, Tencent was the first Asian company, the estimated market value of which reached USD 500 billion. At the same time, it also surpassed the American social media giant Facebook in value.

Jack Ma, the founder of Alibaba

Alibaba Group The e-commerce company, founded in Hangzhou in 1999, is no doubt the symbol of a new, innovative generation in China. Since its establishment, Alibaba has been expanded by numerous successful subsidiaries, such as the online shopping website Taobao, the online payment platform Alipay, or the video-sharing website Youku Tudou. Today, Alibaba is among the 10 most valuable companies in the world, and since 2016, it has been the largest retailer. Last year, on the Singlesâ&#x20AC;&#x2122; Day (11 November) in China, Alibaba reached a record in sales by USD 25.4 billion in just one day. 106

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Xiaomi, Vivo, Oppo All the three consumer electronics companies were founded in the first decade of the 2000s (the latter two are sister companies) and their main profile has become smartphone production by now. Regarding the world market shares, the three companies are among the global top 10. Their strategies are different: in order to reduce

costs, Xiaomi sells its products online, and it uses social media platforms for promotion instead of expensive marketing campaigns and advertisements; on the contrary, Vivo and Oppo spend huge amounts of money on marketing, an important element of which is the sponsorship of sports events and sport clubs.

Huawei The name of the telecommunication and consumer electronics company is well-known in Europe. Founded in 1987, Huawei had a great role in the establishment of the modern Chinese telecommunication system. The company started its operation outside China in 1997, and it gained foothold in the European telecommunication market in 2004. It has 16 research and development centres and dozens of innovation hubs worldwide. Its extensive partner network helps maintaining the innovation capability of Huawei. The company is the smartphone market leader in China, while globally it is ranked 3rd.

The Wanda Plaza in Nanchang

Dalian Wanda The real estate company group was founded in 1988, and it is the worldâ&#x20AC;&#x2122;s biggest private property developer today. From the early 2000s, the profile of the company has been expanded by significant investments in the entertainment and film industry. After purchasing the American AMC Theatres in 2012, the company has gained the majority of the US film theatre market. The large-scale acquisition process continued in the following years and Wanda has become the biggest cinema chain operator in the world today. CULTURE CULTURE&&SOCIETY SOCIETY

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TOP

Rockets and became the first Chinese to play in the NBA. Yao was selected eight times for the NBA All-Star Game, and five times into the All-NBA Team. One of his face expressions captured during an interview even became a popular meme around the world.

Sportsperson

Yao Ming The Shanghai-born basketball player is one of the most famous Chinese athletes. He started his career at the Shanghai Sharks, and then in 2002, he signed for the American Houston 108

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Li Na Tennis player Li Na started her professional career in 1999. Li was the first Asian tennis player who won a Grand Slam: first in 2011, at the Roland Garros, then in 2014, at the Australian Open. She won nine times in single and two times in pair at WTA. In 2014, she was the second on the singles world ranking list, but in the same year, she announced her retirement due to her knee injury.

Ma Long Since 2015, Ma has been ranked number 1 in the world and has hit numerous records in Chinaâ&#x20AC;&#x2122;s national sport, table tennis. He is a threetime Olympic and nine-time world champion and has won seven world cups. He is the first man in the world to win all the important titles in single. And he is still only 29 years old.

Fu Yuanhui The most appealing character of the 2016 Rio Olympic Games was the then 20-year-old swimmer Fu. With her funny grimaces and childlike, honest interviews, she quickly made her way into the heart of millions of people. At the Rio Olympic Games, Fu won a bronze medal, and in the same year, she also won a gold medal at the Tokyo Asian Swimming Championship. Her popularity has been unbroken since then.

Lin Dan Two-time Olympic champion and five-time World champion Lin has been the most successful single badminton player of all time. By the age of 28, he completed the badminton Super Grand Slam, which was a unique achievement. He was the first who won in single at two Olympic Games in a row (in 2008 and in 2012). By winning the 2017 Malaysian Open, Lin, who is often called Super Dan by the fans, won every major title in professional badminton. CULTURE CULTURE&&SOCIETY SOCIETY

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Jiuzhaigou National Park The first national park of China was inscribed by UNESCO as a World Heritage Site in 1992. Located in the southwestern part of the country, covered by mountains, valleys, turquoise lakes, and rainfalls, the national park is a real jewel-box. It is a popular tourist spot for those who want to hike in the beautiful nature or just relax a bit.

Natural Spectacles

Zhangye Danxia These special geological formations, located in Gansu province, are often referred to as rainbow mountains. Their unusual appearance is caused by the numerous colourful rock layers with different mineral content. Surprisingly, this special natural spot has only been getting greater attention since the early 2000s; that is the reason why this beautiful landscape has managed to avoid massive tourism. 110

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Namtso Lake Located in the northern part of the Tibet Autonomous Region, at 4,718 metres above sea level, this lake, as its name (which in Tibetian language, means “Heavenly Lake”) also indicates, is the world’s highest altitude salt water lake, and one of the three holy lakes of Tibet. Many pilgrims and tourists visit Namtso every year to pray or just simply enjoy the view. The contrast between the high, snowy peaks and the vast flatland near the lake creates a spectacular sight. Huangshan Huangshan, or the Yellow Mountains, is one of the most beautiful mountains in China. They got their name from the mythical Yellow Emperor. Cloudy peaks, marvellous rock formations, and evergreen pines lend a unique beauty to the place. Huangshan has inspired uncountable art and literature works since ancient times. It is a highly popular destination of domestic tourism.

Li River The green, stunning karst hills along the banks of Li River in Guanxi province make the top natural landscape of China. Popular programs are river cruising and bamboo rafting for the more adventurous. Here, one can enjoy the beauty of nature and see the traditional local cormorant fishers in action at the same time.

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Feast Dishes

Jiaozi Jiaozi is a traditional food for New Yearâ&#x20AC;&#x2122;s Eve and one of the most favourite dishes of Chinese people in general. The thin pastry dumpling can be round or half-moon shaped, it can be boiled, steamed, or fried. The filling can be both sweet and salty, made with vegetables, mushrooms, or meat. However, during the Spring Festival, one must avoid sour fillings, as it would forecast a bitter and poor year to come.

Zongzi Zongzi is a kind of sticky rice dumpling wrapped into bamboo or other strong leaves, typically made during the Dragon Boat Festival. The Chinese eat zongzi to commemorate the death of the statesman and famous poet Qu Yuan, who became a symbol of patriotism and loyalty. The sticky filling of zongzi can be both salty and sweet. The characteristic form of zongzi is a triangular. Traditionally, it is made at home, when the whole family is together and the recipe is passed on from generation to generation.

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Mooncake Mooncake is the typical pastry of the Chinese Mid-Autumn Festival. Its shape is usually round or square, with good fortune characters or floral motives, and sometimes the Jade Rabbit, the legendary character from the story of the festival, on it. It can be made in numerous versions, with salty or sweet fillings. The most traditional cakes are filled with lotus paste, sweet bean paste, or duck yolk, which represents Moon. Longevity Noodles Longevity Noodles (changshou mian) is a typical birthday dish, but it is also popular during the Spring Festival. The noodle is made of wheat flour instead of rice because it must be stronger and longer than usual noodles. It can be boiled or fried, served in soup, with meat or vegetarian toppings. It is important that the noodles, which represent the long, prosperous, and happy life, cannot be cut or torn because it would symbolically mean the shortening of life.

Spring rolls Spring rolls are a very popular snack not only in China but also all over the world. The thin pastry is filled with various seasonal vegetables or meat, then it is rolled up and pan-fried or deep-fried. Their golden colour symbolises wealth and prosperityâ&#x20AC;&#x201D;this is the reason why spring rolls are an inevitable part of the Chinese Spring Festival. CULTURE CULTURE&&SOCIETY SOCIETY

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THE ANTALL JÓZSEF KNOWLEDGE CENTRE

In its nine years of existence, the Antall József Knowledge Centre (AJKC) has organised many series of events and conferences for both university students and the Hungarian and international professional community. The Knowledge Centre is named after József Antall (1932–1993), a Hungarian educator, librarian, historian, and statesman, who served as the first democratically elected Prime Minister of Hungary after the fall of communism (from 23 May 1990 to his death on 12 December 1993). Talent management is a major part of József Antall’s legacy, and thus filling the gaps in various academic fields is a key mission of AJKC. We are a Budapest-based think-tank conducting research in nationally, regionally, and internationally relevant subjects such as the Visegrád Four (V4) cooperation, the future global role of the U.S., China, Russia, the Middle East, security policy, sustainable development, and technological and social innovation. Our work is divided among three international offices (EU–V4, Transatlantic Relations, Asian and African Relations), three topical offices (Security Policy, Sustainable Development, Talent

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Management), and regional offices in Brussels and two Hungarian university cities, Pécs and Győr. Our main goal is to further domestic and international relations between various institutions, as well as to promote professional collaboration through organizing international conferences, workshops, joint research, and series of lectures. The Publishing Office of the Centre publishes books with the intent to make the works of influential political and social science thinkers of the present and the recent past available in Hungarian. AJKC’s publishing activities also include the publication of academically notable political and social science works primarily concerning security policy and international relations, as well as university textbooks. In our autobiography series, emblematic figures of the Cold War period (Ronald Reagan, George Bush, Margaret Thatcher, and Helmut Kohl) share their personal experiences about the crucial years and decisions that shape our lives even today. Our professional publications contain articles reflecting the defining political, social, and economic trends of the 21st century, taking into account the latest developments in geopolitics,

political history, economic sciences, and psychology. The think.BDPST conference is AJKC’s most ambitious professional event. The goal of think. BDPST is to put Hungary on the map of major regional conferences (GLOBSEC, Krynyca Economic Forum, Prague European Summit) by organizing the region’s largest and most comprehensive innovation forum, thereby facilitating better dialogue among representatives of companies, government, and academia. The event is co-organised by the Ministry of Foreign Affairs and Trade and with the support of the International Visegrád Fund. AJKC pays special attention to the role of the People’s Republic of China. The Centre organises an annual conference examining various aspects of the Belt and Road Initiative, promoting cooperation between Chinese and European specialists. The Chinese “16+1” Cooperation—a platform for wide-ranging joint Central European–Chinese projects—has inspired the Understanding China contest for students. The contest was jointly organised by AJKC, the Central and Eastern European Centre

for Asian Studies (CEECAS), and the Hungarian Embassy of the People’s Republic of China. Participating students from all 16 Central and Eastern European states submitted their works. These were judged by a panel of experts, and the best works will be published in a dedicated volume. The China-related scientific activities of AJKC require intensive cooperation with Chinese partner organisations, a prime example of which is the opening of the Budapest-based China– Central and Eastern European Institute, jointly founded by AJKC and the China Academy of Social Sciences (CASS). Talent management and promoting cooperation among higher education institutions is one of the main missions of AJKC. With this in mind, we organise the annual Danube Regatta, an eight-oar and dragon boat race, with the participation of a growing number of Hungarian university teams. In 2018, the race had 18 Hungarian teams compete for supremacy, and university teams from the other V4 member states also participated. In addition to talent management, the Danube Regatta is also about the versatile utilisation of the Danube and improving Hungary’s international image.

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PAST EVENTS

Cyber warfare in the future 11 April 2018

The V4 and the Eastern Mediterranean— Perspectives of cooperation 24 April 2018

Danube Regatta—V4 races 5 May 2018

At the event co-organised with the Wilfried Martens Centre, the invited speakers looked into how nations could increase their resilience to cyberattacks and what measures should be implemented at a national and supranational level. The first panel discussed how to increase resilience against cyberwarfare at a supranational level and whether the current tools are sufficient to protect our countries and their people in the digital age. The second panel analysed cyberattacks from a national perspective with emphasis on national security strategies.

The first panel focused on mapping out the main political and social challenges in the Eastern Mediterranean region. The second panel was centred on establishing cooperation and synergies between the V4 and the states of the Eastern Mediterranean region. The speakers were Efraim Karsh, director of the Begin-Sadat Centre for Strategic Studies, EPRS analyst Elena Lazarou, Sherin Gharib, research fellow of the Austrian Institute for International Affairs, Dimitrios Triantaphyllou, research fellow of the Kadir Has University’s Centre for International and European Studies, Tamás Szigetvári, chief scientific researcher of World Economy Institute of the Hungarian Academy of Sciences’ Economic and Regional Research Centre and Adam Balcer, the foreign policy projects manager of the WiseEurope Institute.

This sixth regatta jointly organised with the Hungarian Tourism Agency was one of the priority events of the Hungarian V4 presidency. It was attended by 18 Hungarian teams and teams from the other V4 member states and consisted of eight oar and dragon boat races as well as a beach volleyball competition. The rowing teams competed on the most beautiful Danube stretch of the Hungarian capital between Parliament and the Technical University Pier. This was followed by beach volleyball, wall climbing and e-sports. The eight oar professional regatta was won by the team of the Széchenyi István University, the first heat of the dragon boat race by the Semmelweis University and the second heat by the University of Physical Education.

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PAST EVENTS

Antall József Summer School 2–12 July 2018

In 2017, the Knowledge Centre organised the Summer University named after József Antall, whose name the institution bears, for the first time. Its primary goal was to reinforce and highlight the Visegrád Four cooperation in the area of education. Every year, 30-35 MA and PhD students are invited. The event offers the opportunity for students interested in Central European studies to expand their knowledge and understanding of the recent history of the V4 region and Hungary. During the two-week event, participants are presented with a clear picture of the historical, economic, financial, foreign policy, security policy, multilateral, innovation, energy, cultural, and sustainable development relations of the Central European region. In addition to the varied professional programs, the participants of the summer university also have the opportunity to attend a series of cultural events geared towards enhancing intercultural dialogue. The students have the opportunity to visit the Hungarian Parliament, a one-day field trip to the Visegrád Royal Castle, which has a special historical significance for the Visegrád Cooperation, because the first summit of V4—initiated by then Prime Minister József Antall—took place here in 1991. The fifth Summer University has also offered the chance to its former students to pass on their accumulated knowledge to the younger generation and was complemented by an alumni meeting where the former students gave an account of their activities and attended management training. The summer school held between 2–12 July 2018 was focused on the relations of the V4 with other countries and regional groups, the V4’s role in the European Union, and the challenges faced by the EU, the integration of the West Balkans, cross-border security threats, and changing forms of regional cooperation. This year, we also gave the chance to our alumni—many of whom, we are proud to say, have since gone on to important governmental, business or academic positions—to hold lectures in their respective fields of expertise.

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NEW RELEASES

Xi Jinping: The Governance of China

Richard Susskind—Daniel Susskind: The Future of the Professions

“In response to growing international interest and so that the rest of the world can better understand the philosophy of the Chinese government and the country’s domestic and foreign policy, the State Council Information Office, the Party Literature Research Office of the CCP’s Central Committee and the China International Publishing Group have jointly issued a book— The Governance of China. This volume is a selection from the most important works of Xi Jinping between November 15, 2012 and June 13, 2014. It contains Xi Jinping’s speeches, discussions, interviews, directives and greeting letters. The 79 writings have been organised in 18 chapters and supplemented with footnotes, so the readers can have a better understanding of the Chinese social system, history and culture. The book also contains 45 photographs of Xi Jinping at work or in everyday situations. Most of the pictures were taken after the Chinese Communist Party’s 18th Congress in 2012.” (Excerpt from the Chinese publisher’s foreword.)

The authors give a fascinating overview of how every profession will change in the not so distant future due to technological development. We are witnessing a gradual transformation: currently, the acquisition and social distribution of expertise is also undergoing fundamental changes, leading to the eradication of traditional crafts. This thesis may sound frightening at first, and this is why the authors urge a new approach and offer a glimpse into the opportunities brought by these changes. Richard Susskind has published several volumes about the future of legal services and has held lectures on the topic around the world in the past twenty years. The feedback led him to the conviction that his theory applies not only to the legal profession but to practitioners of medicine, auditing, journalism, education, and other professions. He has expanded his research and this volume can be a meaningful and thoughtprovoking reading for any professional.

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NEW RELEASES

Tibor Frank—Tamás Magyarics: Handouts for U.S. History

Mózes Csoma: The History of Korea

This textbook by Tibor Frank and Tamás Magyarics was first published in 1995, the English version in 1999 and the current issue comes after a ten-year pause. The third, improved, and extended edition includes five new chapters that complement the previous essential volume with the events of the recent past. The volume is an overview of the history and multicultural society of the United States of America from its establishment to the present: the world power and what impact it has on the history of the world’s other countries. The learned authors analyse everyday USA since the time of discovery and the first settlers, guiding us through the Civil War, two world wars, Cold War, and multiculturalism. They also look at current political, economic, and cultural trends. They both hope that the third edition of their already popular textbook will gain the attention of students and history enthusiast alike, as the book offers a comprehensive overview of the state that has for so long shaped not only its own fate but that of many other countries. The reader will find additional guidance in the accompanying maps, addenda, and extensive bibliography.

The situation of the Korean peninsula has become a hot international affairs topic in the last years. Korea researcher Dr Mózes Csoma gives us an overview of the peninsula’s history from the beginnings to the latest developments, while also pointing out the differences in the North and South Korean interpretations of the various periods. The Cold War division has also had an impact on historians’ interpretations of ancient, medieval, and modern history: the textbooks of the Republic of Korea and Democratic People’s Republic of Korea present these eras and their historical figures in diverging ways. In discussing 20th-century developments, the author relies heavily on previously unpublished archival material containing a plethora of new information regarding the development of relations on the peninsula. For this monography the author also conducted a series of interviews with diplomats and eyewitnesses, providing valuable accounts of Korean political processes and trends.

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NEW RELEASES

Jakub J. Grygiel—A. Wess Mitchell: The Unquiet Frontier

Tamás Magyarics (ed.): American Conservative Thinkers

While in recent years, the United States has sounded a global foreign policy retreat, in the belt spanning from the Baltic Sea to the South China Sea, three authoritarian regimes—Russia, Iran, and China—are making increasingly confident efforts to restore their respective erstwhile empires. While these three emerging powers are busy restoring their former glory, the United States has turned its attention to its allies on the fringes of the U.S. zone of influence. The two authors argue that the emerging revisionist powers are exerting pressure on border land countries—such as Russia’s pressure on Hungary—in the hope that the lack of a meaningful American response proves that the U.S. is in decline, and its disappointed allies increasingly turn towards their emerging neighbours. The Unquiet Frontier calls for a new, comprehensive, and active U.S. foreign policy. It advocates a strategy that should dissuade these emerging powers from aggression through a network of East European, Middle Eastern, and East Asian alliances and would succumb to the self-fulfilling prophecy of a new multipolar world order.

The volume aims to introduce us to the multicoloured post-WWII American conservative thought from value conservativism through (neo)-liberal economic concepts to foreign- and security policy realism and neo-conservativism. The collection not only includes authors well-known in Hungary, such as Milton Friedman or Robert Kagan, but also less recognizable ones such as Robert H. Brok, a scholar of law of United States fame on account of his political and constitutional thoughts. On the one hand, the book wishes to add detail to the image of a United States dominated by liberalism, and also offers guidance for the better understanding of U.S. political, economic, social, and cultural trends.

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OUR

TING

NTR

THO

Tamás Péter Baranyi Historian, doctoral candidate

The Middle Kingdom

Editor in Chief, Research leader

Zsolt Csepregi MA, International relations International coordinator

The Stabilizing Role of the Belt and Road Initiative in Eurasia The 21st-century Maritime Silk Road

Cecília Varsányi MA, Economic sciences

The Decarbonisation of China—Myth or Reality?

Head of office, Sustainable Development

Mihály Kálóczi MSc, Environmental engineering

The Decarbonisation of China—Myth or Reality?

International relations referent

Viktória Anna Papp BSc, International Relations International Law and China LLM International relations referent

The 19 th Congress of the CCP—Announcing the “New Era”

Vica Versa: Chinese in Hungary—

Hungarians in China

The Chinese Soft Power

The Four Classic Novels of Chinese Literature

Emese Schwarcz MA, International relations

Panda Diplomacy

Asian and African relations referent

Counrty Profile Noémi Eszterhainé Szőke MA, History International relations referent

Colourful China

Chinese Higher

Education: Is Bejing University the Harvard of the Future? Chinese Film Industry—Past, Present and Future

Top 5 Modern Chinese Music

The Four

Great Chinese Inventions Chinese Languages ANTALL JÓZSEF KNOWLEDGE CENTRE

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REFERENCES OF

PICTURES AND USED DATA Inner cover: The Great Wall of China: Shutterstock

Page 34: Gross domestic product (GDP) in current prices (in trillion US dollars), Source: World Bank Page 35: Gross Domestic Product (GDP) at purchasing power parity

20–21 Page: Shanghai: Shutterstock

(in trillion Intl. dollars), Source: World Bank

Page 22: Cover of Bamboo Annals, 1806: https://hu.wikipedia.org/wiki/

Page 36: Currency composition of foreign exchange reserves (in %),

Bambusz-%C3%A9vk%C3%B6nyvek#/media/File:Zhusu_Jinian.png

Source: IMF

Page 23: One phase of the paper-making process (Ming era wood-

Page 37: Estimated real GDP growth in the coming years (%), Source:

cut): https://commons.wikimedia.org/wiki/File:Making_Paper_4.PNG#/

World Bank

media/File:Making_Paper_3.PNG

Page 37: World Bank estimates for global growth, measured in real

Page 23: Chinese compass: Shutterstock

GDP and expressed in percentages (2017–2019), Source: http://www.

Page 23: Chinese characters carved into movable clay blocks:

visualcapitalist.com/chart-global-growth-happening/

Shutterstock

Page

Page 23: One of the early methods of using gunpowder: the rocket:

D e ng _ X iao ping # / m e dia / F ile:D e ng _ X iao ping _ a nd _ J im my_

https://upload.wikimedia.org/wikipedia/commons/5/5e/Chinese_

Carter_at_the_arrival_ceremony_for_the_Vice_Premier_of_China._-_

rocket.png

NARA_-_183157-restored(cropped).jpg

Page 24: Zhongguo: Shutterstock

Page 39. Shutterstock

Page 24: Qin Shi Huangdi: https://commons.wikimedia.org/wiki/

Page 43: Chinese goods in Belarus, en route to European markets:

File:Qinshihuangdi3.jpg

Shutterstock

Page 25: Opium imports into China 1650–1880: https://en.wikipedia.

Page 45: The most important land and maritime strategic projects

org/wiki/History_of_opium_in_China#/media/File:Opium_imports_into_

of the Belt and Road Initiative, Source: Pallas Athene Innovation and

China_1650-1880_EN.svg CC BY 4.0

Geopolitical Foundation

26–27 Page:

Page 46: The ancient Silk Road linking India and China: Shutterstock

1: Shutterstock

Page 47: The Khunerjab pass on the border of China and Pakistan:

2: Shutterstock

Shutterstock

3: Shutterstock

Page 48–49: Freight train in the Tian Shan Mountains, Xinjiang prov-

4: https://hu.wikipedia.org/wiki/Caj_Lun#/media/File:Cai-lun.jpg

ince: Shutterstock

5: Shutterstock

Page 50: Shanghai—the world’s busiest container port: Shutterstock

6: https://en.wikipedia.org/wiki/Wu_Zetian#/media/File:Empress_Wu_

Page 51: The 2016 Riga Summit between China and the CEEC: https://

of_the_Zhou,_published_c_1690.jpg

www.flickr.com/photos/latvianmfa/30553648810

7: https://en.wikipedia.org/wiki/Song_dynasty#/media/File:Jiao_zi.jpg

Page 52: China’s trade with CEE countries between 2011 and 2017, in

8: https://en.wikipedia.org/ wiki/ Yuan _dynast y#/media /

million USD, Source: Ministry of Foreign Trade of China

File:YuanEmperorAlbumKhubilaiPortrait.jpg

Page 53: China’s FDI in CEE countries in stock, million USD, Source:

9: https://en.wikipedia.org/wiki/Zheng_He#/media/File:KangnidoMap.

Statistics on China’s Outflow FDI, Ministry of Commerce, National

jpg

Bureau of Statistics, State Administration of Foreign Exchanges, China

10: https://commons.wikimedia.org/wiki/File:Flag_of_the_Qing_

Page 54: China’s FDI in CEE countries in flow, million USD Source:

dynasty_(1889-1912).svg

Statistics on China’s Outflow FDI, Ministry of Commerce, National

26–27 Page: An overview of the civilisations in China and in the

Bureau of Statistics, State Administration of Foreign Exchanges, China

American and European continent, Source: https://images.chinahigh-

Page 57: Shutterstock

lights.com/allpicture/2017/07/99a04d09f69f4ac7b474c509.jpg

Page 58: Where the most important meetings take place: the Great Hall

Page 29: Shutterstock

of the People: Shutterstock

Page 30: Xi Jinping at the 2017 World Economic Forum in Davos:

Page 59: Structure of the CCP: Source: AJKC

Shutterstock

Page 60: Postage stamp issued on the occasion of the 19th National

Page 31: The Chinese People’s Liberation Army—one of the world’s

Congress of the Chinese Communist Party: Shutterstock

largest armies: Shutterstock

Page 62: People’s Bank of China headquarters in Beijing: Shutterstock

Page 34: The pace of Chinese GDP growth (%, 1985–2017), Source:

Page 66: Shutterstock

World Bank

39:

Deng

Xiaoping:

https://en.wikipedia.org/wiki/

Page 67: The Shenzen Stock Exchange is one of China’s three stock

Page 93: Number of traditional higher educational institutions between

markets, besides Hong Kong and Shanghai: Shutterstock

1987 and 2016, Source: National Bureau of Statistics of China

Page 68: The most toxic countries in the world: https://www.theecoex-

Page 93: Number of Regular Students for Normal Courses in HEIs by

perts.co.uk/most-toxic-countries

Discipline, Source: National Bureau of Statistics of China

Page 69: Population growth of China, Source: World Bank: https://data.

Page 94: Sun Wukong, the Monkey King: Shutterstock

worldbank.org/indicator/SP.POP.TOTL?locations=CN

Page 94: A scene from Water Margin: Wu Song fights the man-eating

Page 69: Death from air pollution per million inhabitants,-

tiger: Shutterstock

S o u rc e:

Page 96: Decorated portal for the Spring Festival: Shutterstock

O E C D,

h t t p s: // w w w. s t at i s t a .c o m /c h a r t /4 8 01/

europe-matches-asian-giants-in-air-pollution-deaths/

Page 97: Dragon Boat Race in Foshan, China: Shutterstock

Page 69: China’s population pyramids: 1960, 2015, 2050, Source:

Page 99: Valentine’s Day is very popular among the Chinese youth:

World Bank: https://asiapacificcurriculum.ca/learning-module/

Shutterstock

chinas-one-child-policy

Page 100: During the Qingming Festival paper money printed for this

Page 70: Changes in savings, investments and household consump-

occasion is being burned: Shutterstock

tion, Source: IMF,: https://qz.com/541214/bad-news-everyone-china-

Page 102: Bruce Lee: Shutterstock

justcommitted-itself-to-growing-6-5-a-year-until-2020/

Page 103: Gong Li: Shutterstock

Page 71: Energy intensity in selected countries and regions, 2015:

Page 104: Hengdian World Studios: Shutterstock

https://www.eia.gov/todayinenergy/detail.php?id=27032

Page 105: Lang Lang: Shutterstock Page 106: Alibaba Founder Jack Ma: Shutterstock Page 106: Tencent logo: Shutterstock

74–75 Page: The Terracotta Army: Shutterstock

Page 106: Xiaomi smartphone: Shutterstock

Page 76: Lahu women wearing traditional cloths (Kunming area):

Page 107: Huawei logo: Shutterstock

Shutterstock

Page 107: Wanda Shopping Plaza, Nanchang: Shutterstock

Page 76: Yao women: Shutterstock

Page 108: Yao Ming: Shutterstock

Page 76: Nakhi man in traditional clothing: Shutterstock

Page 108: Li Na: Shutterstock

Page 77: The compared ratio of ethnic groups in China (without the

Page 109: Ma Long: Shutterstock

Han), Source: National Bureau of Statistics of China

Page 109: Lin “Super” Dan: Shutterstock

Page 78: Shutterstock

Page 109: Fu Yuanhui: Shutterstock

Page 79: Ladies of the Chinese community in Budapest dance at the

Page 110: Jiuzhaigou National Park: Shutterstock

2018 Chinese New Year celebration: Shutterstock

Page 110: Zhangye Danxia Geopark: Shutterstock

Page 81: Shanghai, Park Hotel: Shutterstock

Page 111: Huangshan: Shutterstock

Page 84: Lion guarding a gate: Shutterstock

Page 111: Li River: Shutterstock

Page 85: Shutterstock

Page 111: Namtso Lake: Shutterstock

Page 86: Statue of Confucius: https://www.flickr.com/photos/

Page 112: Jiaozi: Shutterstock

rob_web/466866299

Page 112: Zongzi: Shutterstock

Page 87: We must pay attention to a number of things when exchanging

Page 113: Mooncake: Shutterstock

business cards with our Chinese partners: Shutterstock

Page 113: Longevity Noodles: Shutterstock

Page 88: Table at a Chinese business dinner, with rotating glass plate

Page 113: Spring roll: Shutterstock

in the middle, Source: Shutterstock Page 89: A seating diagram of Chinese business dinners: AJKC Page 92: Preparing for the academic examination requires great effort from secondary school students: Shutterstock Page 92: A group of graduate students at Peking University: Shutterstock Page 93: Number of enrolments at undergraduate higher education level between 1987 and 2016, Source: National Bureau of Statistics of China

NEXT ISSUE 2018. 3st Issue Free of Charge

IN FOCUS: ENVIRONMETNAL MIGRATION In the next English language issue of In Focus magazine, we will take a look at the phenomenon of environmental migration. While at first glance the expression itself may seem self-explanatory, it is quite controversial: we can hardly find any historical example where the environment did not influence the movement of people. However, in most cases, this influence was an indirect one. Why should one be named environmental and the others not? Does this concept stand up to scientific scrutiny? Should climate change become severe, what effect would that have on already convoluted international legislation? How can we deal with the issue taking into account both humanitarian and security policy considerations? Our next issue begins with the definition of the phenomenon and the enumeration of potential theoretical problems. We will also give a detailed overview of potential climate change scenarios and their multiplicator effect. While we look at the issue of migration, we will also travel back in time and around the globe. We will examine examples from Italy to Algeria, from the Pacific archipelago to Bolivia, from the arctic region to South Africa to see what impact water shortages, droughts, rising sea levels, and global warming have on global migration. We are not dealing with doomsday scenarios, and besides the problems, we will also be looking into potentially successful countermeasures, from greening deserts to the heroic fight against rising water levels.

Environmental Migration

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