Past Speakers

Feiyu Xu’s lecture vividly illustrated how rapidly artificial intelligence (AI) has evolved into a key technology of the present and the future. Xu described AI as systems capable of performing tasks once reserved for human intelligence—from recognizing and combining images and language to independently learning and generating new content. In its ability to link language, image, and action, modern AI differs fundamentally from earlier technologies: it extends human perception, memory, and creativity—and is beginning to think on its own.

Xu explained how AI has shifted from classification to generation. Earlier models functioned like students who depended on labeled examples, while today’s “foundation models” learn autonomously. They identify patterns in unstructured data and derive new solutions. This makes them not only more powerful but also more unpredictable—a comparison Xu likens to “a child released into the world without knowing what it might become.” Humanity thus faces a double challenge: creating intelligence it must also supervise and restrain.

Economically, this shift has triggered an unprecedented investment wave. Never before, Xu noted, have hundreds of billions flowed into a single technology in such a short time. The dominant players—Nvidia, Microsoft, Google, Apple, and Amazon—control the global AI landscape through chips, cloud infrastructure, and software. Yet China’s DeepSeek project demonstrated that even with much less capital—six instead of hundreds of millions of dollars—AI models can reach near-Western quality. For Xu, this marks a turning point: a “Sputnik moment” that could reshape the global AI power balance.

Xu compared three major regions: the United States, China, and Europe. The U.S. remains the center of foundational research and capital, home to top talent, the largest data centers, and the leading models. Its culture of risk-taking and entrepreneurial freedom accelerates innovation, while Europe struggles with regulation and hesitation. China, by contrast, excels through speed, scalability, and state coordination. With over 700 million surveillance cameras, 30,000 hospitals, and vast data reserves, it is building an AI infrastructure unlike any other. Where Europe debates, China tests, standardizes, and scales applications.

Xu praised China’s determination to become a global leader in AI innovation and application by 2030—while criticizing Europe’s lack of ambition. “If you start out aiming to be only number two,” she remarked, “you’ll end up last.” Europe, she argued, needs renewed courage for leadership, less bureaucracy, and greater investment power. Rather than funding research “with a watering can,” focus and talent retention are essential. Venture capital culture is equally decisive: while multimillion-dollar seed rounds are standard in China, in Europe even €100,000 can be considered success.

In the final part of her talk, Xu outlined the rise of autonomous enterprises and “co-governance,” where humans and AI agents make joint decisions. Executives will be assisted by digital copilots that analyze data, make predictions, and steer processes. Hierarchies, responsibility, and ethics will fundamentally change. What happens when an AI agent makes an error? How do we govern machines that are no longer mere tools but co-actors?

Despite her enthusiasm, Xu emphasized the need for trust, transparency, and control. The European AI Act, she said, could provide a moral foundation despite its strictness. AI will not only reshape the economy and administration but society as a whole—potentially even enabling the design of tissues and organs through synthetic biology.

Xu concluded with an appeal: digitalization is not a passing train one may miss—it is an infrastructure, like roads or electricity, essential for a nation’s future. AI is not a hype but a new reality—one that will permanently redefine our understanding of work, knowledge, and responsibility.

In the Q&A session, the audience focused on the societal, ethical, and practical implications of AI. Xu stressed that AI agents should assume responsibility gradually—only for limited tasks until proven reliable. “Humans must control, test, and validate,” she said. A structured “lifecycle of handover” is vital before large-scale deployment.

When asked whether AI enhances or weakens human perception, Xu replied that concentration and attention depend on education, not technology. While she acknowledged the risk of superficiality, she believes AI could help societies better understand human behavior and foster greater awareness. Yet she voiced concern for democracy: Europe, she warned, is losing its capacity to act, while authoritarian systems make faster decisions.

Finally, Xu addressed AI’s limits: it can raise the average but cannot replace excellence. Human creativity and empathy remain irreplaceable. She cautioned against military uses—AI drones and autonomous weapons pose a global risk that only international oversight can contain.

China Forum Lecture & Discussion Series “China – Challenge and Opportunity,” 2025

At the ChinaForum of the MoneyMuseum Zurich on August 25, 2025, Felix Lee summed it up in one sentence: “China is indispensable – and that is Europe’s greatest dilemma.”

Few countries have changed as fast as China: from isolated agrarian backwater to global powerhouse. German-Chinese journalist Felix Lee has watched this transformation up close, first as Beijing correspondent and now as author of China – Finding a Way Out of a Dilemma (with Finn Mayer-Kuckuk). His central question: What future does China face, and how should Europe – especially Germany – handle its growing dependence?

For decades, European companies thrived on the China boom. Volkswagen at one point ran 39 factories there. BASF, Mercedes, Audi – up to 40% of their sales come from China. Europe provided the technology and investment, China the markets and profits. Now the tide has turned: this tight embrace has locked Europe into structural dependence that looks dangerous in today’s geopolitical climate.

Politics and business pull in opposite directions. Berlin talks “de-risking,” meaning less exposure to China. But companies hear the word differently: to them, it means more presence in China, hedging production risks while staying in the world’s biggest market. For VW or BASF, pulling back is unthinkable. Result: political strategies fall flat, while economic reality deepens the ties.

The problem runs deeper. China dominates rare earth processing, critical for batteries, telecom, and green tech. Breaking that grip would take decades. Europe is stuck: economically tied, politically suspicious, strategically adrift.

China, meanwhile, faces its own cracks. The one-child policy has left a shrinking workforce and a rapidly aging society – a “demographic time bomb.” Corruption and lack of rule of law undermine trust. Yet, Lee notes, the regime still has resources to keep going for years.

And still, China advances. It pushes tech innovation, expands influence in the Global South, and opens new markets – while the West seems mired in caution and self-doubt. The picture is paradoxical: fragility and dynamism side by side. Journalists, Lee admits, often overplay extremes. Reality sits in the uneasy middle.

For Europe, the challenge is clear: find a sober, realistic stance toward China. Neither blind partnership nor knee-jerk distancing will work. The continent must rediscover its own strengths – economic, political, cultural – and act with confidence. China’s single-minded focus on Germany shows how well it exploits Europe’s weak integration.

The dilemma remains: China is both partner and rival. Europe must learn to live with the tension. Lee offers no easy answers, but his message is sharp: Europe needs long-term strategy, not short-term gains. Whether it succeeds may decide not just Europe’s future, but the balance of the global system itself.

Felix Lee (b. 1975, Wolfsburg) studied sociology, economics, and politics, trained at the Berlin School of Journalism, and reported for taz from 2003–2022, including nine years as Beijing correspondent. His book China, My Father, and Ibecame a Spiegel bestseller, won the 2023 German Business Book Prize, and stayed in manager magazin’s Top 10 for a year. His latest, with Finn Mayer-Kuckuk, is China: Finding a Way Out of a Dilemma.

At the ChinaForum of the MoneyMuseum Zurich, held on June 5, 2025, at Club Baur au Lac, Professor Genia Kostka presented a nuanced perspective on China’s digital ambitions.

At the core is the tension between Beijing’s centrally steered vision and the fragmented, sometimes contradictory realities across China’s provinces. While the state sends strong “signals” about its intended direction, local implementation remains fragmented, experimental, and highly context-dependent.

China has clearly set its goal: to become a global leader in digital transformation. Cities like Shenzhen serve as showcase projects for smart city initiatives. Yet, as field research shows, many of these projects remain in pilot stages. They are less evidence of widespread digital reality and more symbolic demonstrations of technological ambition. In many places, basic digitalization efforts stumble over familiar obstacles: poor data quality, lack of standardization, and weak coordination. Cities such as Chengdu reveal how deeply structural weaknesses run—for example, in attempts to consolidate population data.

A central theme of the lecture was the pronounced regional differences within China. While major cities are equipped with cutting-edge infrastructure, other provinces struggle with environmental problems or economic stagnation. In those regions, digitalization is simply not a priority. The result is a patchwork of digital realities rather than a monolithic digital empire.

Perhaps surprisingly, surveys report high levels of acceptance even for controversial measures like the Social Credit System. Even if results may be skewed by “preference falsification” (the tendency of people not to answer truthfully), support levels of around 70 percent remain striking. Yet this support is not driven by ideology but by pragmatism: people mainly ask what concrete benefits the system brings to them. Privacy concerns rank low; instead, many Chinese citizens express a desire for reliable state structures, better education, and functioning rule of law 

Another key point in Kostka’s analysis is the shift in political legitimacy. Once grounded in economic growth, the Chinese Communist Party increasingly emphasizes nationalism and a distinct “Chinese path” deliberately set apart from the West. Party membership is seen as a vehicle for social mobility—the Party as a career-making network.

On a global scale, Europe lags behind in investment in digital key technologies. While China and the United States dominate, Europe could claim a different kind of leadership—ethical leadership—especially in debates around the social consequences of artificial intelligence. But here too, Europe faces its own bureaucratic hurdles.

The lecture closed with a crucial question: How can such a dynamic, heterogeneous system be understood at all? Classic Western methods—surveys, interviews—often fall short. Instead, deeper ethnographic approaches are needed: an understanding of how people use technologies in their daily lives and the meanings they assign to them. Only from this perspective can China’s digital transformation be truly grasped—beyond simplified narratives.

Prof. Dr. Genia Kostka is Professor of Chinese Politics at Freie Universität Berlin. She studied in Hong Kong, at the London School of Economics and Political Science, and at Johns Hopkins University, and earned her PhD at the University of Oxford. Her research focuses on digital governance, environmental politics, and political economy.

As part of the ChinaForum of the MoneyMuseum Zurich on February 27, 2025, at Club Baur au Lac, Professor Susanne Weigelin-Schwierdrzik presented on the topic China and the Future of Europe.

 I am pleased to be here this evening. The world has fallen into disorder in recent weeks, and this turmoil is also reflected in our thinking. That is why I want to address two central questions today:

1. China and Europe – Rivals, Partners, or Something Else?

Much debate revolves around whether China is Europe’s rival, partner, or challenger. But such terms fall short. Relations between China and Europe are not simply bilateral; they are embedded in a larger geopolitical structure that I call the strategic triangle: China, the United States, and Russia.

Every decision in China-Europe relations is shaped by the rivalry and interplay of these three powers. Yet many analyses overlook this bigger picture. Countless books explore China-Europe relations, but often they miss the decisive point: these ties are deeply influenced by the triangular dynamics of the great powers.

We are now seeing a geopolitical shift. Under President Biden, the U.S. was viewed as a reliable European partner. But under Trump, things could change. His vision seeks to reorder the world, possibly aligning with Russia against China – a kind of “reverse Kissinger.” Nixon and Kissinger in the 1970s drew China into partnership against the Soviet Union. Trump, in contrast, seems to aim at drawing Russia to his side against China.

For Europe, this shift has major consequences. Until now, our focus has been on Ukraine and transatlantic ties. But in this new order, China plays a decisive role. Beijing knows it risks isolation. That is why Foreign Minister Wang Yi appeared at the Munich Security Conference in unusually diplomatic and conciliatory tones toward Europe – a sign of China’s urgent search for new allies.

2. Is Europe a Great Power or a Middle Power?

Another key question: Is Europe truly a great power? Many assume the answer is yes. But this is an illusion. Europe tends to imagine itself as a world power, when in reality it is a middle power.

What defines a middle power? The ability to maintain constructive relations with all great powers. Europe sits geographically between the U.S., Russia, and China. Economically, we are tied to China, in security we depend on the U.S., and geographically we neighbor Russia. Instead of using this unique position wisely, Europe remains stuck in self-delusion.

Trump, by contrast, voices the geopolitical reality bluntly: world order is based on hierarchy, not equality. While the EU pretends that all states are equal, the UN structure tells a different story – veto powers versus non-veto powers. Europe ignores this hierarchy and believes moral appeals suffice to wield influence. But the current world order is shaped by power politics, not idealism. To misread this is to make strategic mistakes. Europe must therefore embrace its role as a middle power rather than pretending to be equal to the U.S. or China.

3. China’s Strategy and Europe’s Future

China itself faces enormous challenges: slowing growth, an economy under strain, and domestic stability that depends on continued prosperity. A U.S. strategy may be to apply enough economic pressure to push China into internal crisis – much like the Soviet Union in the 1980s. Should China stumble economically, Beijing might one day see the risk of military conflict over Taiwan as the lesser evil.

For Europe, the implications would be catastrophic. A Taiwan conflict would shake the global economy, and Europe cannot afford a destabilized China. At the same time, Europe must decide how it positions itself strategically.

4. The Ukraine Crisis as China’s Opportunity?

An interesting angle: China might reinsert itself into global diplomacy through the Ukraine crisis. If the U.S.-Russia conflict stagnates, China could step in as mediator. This would not only strengthen China’s global standing but also open doors for closer ties with Europe.

One scenario: China or India could send neutral peacekeeping troops to Ukraine to fill a security gap. This would have several advantages:

1. Russia would find it hard to fight Chinese or Indian soldiers.

2. China could redefine its global role and break free from isolation.

3. Europe could use diplomacy to strengthen its place in a new world order.

Whether Europe seizes this chance is uncertain.

5. Conclusion: Europe’s Role in a New World Order

Europe must face facts: it cannot act as a great power. Its path forward is to embrace middle-power status and position itself skillfully between the three great powers.

The greatest risk is being sidelined by Trump’s and Putin’s geopolitical realignment. If they reach an understanding and isolate China, Europe too could be pushed to the margins.

What can Europe do? It must use its relationship with China strategically, not out of naivety, but from self-interest. Only by pursuing pragmatic policies toward China can Europe avoid being crushed between the U.S. and Russia.

Professor Susanne Weigelin-Schwierdrzik studied Sinology, Japanese Studies, and Political Science (1973–1978) in Bonn, Beijing, and Bochum. From 1989 to 2002, she served as Professor of Modern Sinology and Vice Rector for International Relations at Heidelberg University. From 2002 to 2020, she was Professor of Sinology at the University of Vienna, and since 2012 she has been a member of the Austrian Academy of Sciences. Since 2022, she has been on the Academy Council and Program Director for China at the Center for Strategic Analysis in Vienna. Her research focuses on 20th-century Chinese history, East Asia, and China’s foreign policy. Her most recent publication is China and the Reordering of the World (Vienna, 2023).

 At the ChinaForum of the MoneyMuseum Zurich on September 3, 2024, held at the Club Baur au Lac, Jörg Wuttke — former President of the European Chamber of Commerce and Chief Representative of BASF in Beijing, now Partner at Dentons Global Advisors – Albright Stonebridge Group — spoke about China’s economic and geopolitical developments.

One of the central questions was why China, despite having all the prerequisites, did not manage to dominate the 21st century.

Wuttke emphasized that with its population size, industrial capacity, and innovative strength, China could have taken a leading global role similar to Germany’s in the 20th century. Yet, due to political choices—particularly under Xi Jinping—the country has taken a confrontational course that has alienated international investors.

A key point of the talk was the increasing politicization of China’s economy. While Deng Xiaoping in the 1980s had opened and reformed the country to integrate it into the global economy, Xi Jinping now pursues a strategy of self-reliance and of making other countries dependent on China. This shift has seriously undermined China’s potential to dominate the century. The renewed focus on state-owned enterprises and the continuing closure of the Chinese market to foreign investors have slowed economic growth and made the country less attractive for Western capital.

Wuttke pointed out that China’s market is losing importance as an export destination and investment site, particularly for small and medium-sized enterprises. Multinationals such as BASF and Volkswagen still invest, but overall enthusiasm for China is waning—partly because of intense competition from Chinese companies that have become global leaders in fields like electric mobility and digital technology.

Another major topic was the deepening U.S.–China rivalry. Xi Jinping’s policy, Wuttke noted, is increasingly confrontational toward Washington, which in Beijing is seen as a response to perceived U.S. attempts to contain China’s rise.

Despite its economic strength, China faces significant challenges—industrial overcapacity and a shrinking population among them. Many sectors produce vast quantities without generating profits, especially the automobile industry, where over 100 Chinese firms manufacture electric vehicles but only a handful are profitable.

Wuttke concluded that while China will remain an essential player in the world economy, it will not dominate the 21st century as long as it continues its current path of isolation and confrontation.

“We wanted to change China – now China has changed us.”

Wuttke’s statement captures a central realization that has emerged in the West’s relationship with China. Western governments and companies originally entered the Chinese market believing that trade, investment, and cultural exchange would open and modernize the country along Western lines. Integration into the global economy was expected to lead to political and social convergence toward democracy and free-market principles.

That expectation did not materialize. Under Xi Jinping, China has pursued its own economic and political objectives without adopting fundamental democratic or market-liberal values. Instead, it has increased Western dependence in strategic sectors such as technology, automotive production, and supply chains. Western companies deeply invested in China now find themselves under pressure to adapt to Chinese rules—state control, censorship, and a heavily politicized business environment.

In essence, Wuttke’s remark underlines that the West’s hopes of transforming China have been reversed: rather than China becoming more like the West, the West has had to adjust to China’s realities.

 Nationalism is an omnipresent phenomenon that plays a central role both in established democracies and in authoritarian systems. Examining its dynamics in China not only offers insight into Chinese society but also sheds light on global developments. In particular, the combination of nationalism and digital media is crucial for understanding modern political discourse.

In China, nationalism is deliberately used by the Communist Party as a political instrument. Official narratives draw on historical traumas—such as the Nanjing Massacre—or territorial claims—such as the Diaoyu Islands—to create a collective sense of “we.” These narratives are amplified through media technologies. Subtle examples, such as weather forecasts for uninhabited islands or algorithmically steered discussions on online platforms like Bilibili, create symbolic connections to national identity. Yet, the line between state control and organic discourse is blurred. While the Party influences algorithms and content, many nationalist movements also arise from citizen initiatives or commercial mechanisms that reward popularity and engagement.

Digital infrastructure plays an ambivalent role. On one hand, it enables control and targeted dissemination of content; on the other, networks often develop their own dynamics. Popular comments—even extreme or toxic ones—can be boosted by engagement algorithms, shaping the discourse in unpredictable ways. This demonstrates that nationalism in digital contexts is emergent and cannot be completely controlled, not even by an authoritarian government like China’s.

However, the phenomenon extends far beyond China. Across the world, nationalism is increasingly filtered and reinforced through digital media. Subtle reminders of national belonging—from passports to currencies—and global events such as sports competitions create symbolic connections. Technology, in this sense, is neither neutral nor purely deterministic; through its design and algorithms, it shapes how communities are perceived and imagined.

The lessons from China show how nationalism is both constructed and instrumentalized. It is not monolithic: different actors—from the Party to citizen groups—use similar narrative tools to pursue their own political objectives. Recognizing that nationalism is ultimately a social construct helps us understand and critically examine its mechanisms.

Key Insights and Open Questions

1. The Complexity of Nationalism in China

   Nationalism in China is a dynamic phenomenon shaped both by the state and by grassroots initiatives. The close intertwining of government control and individual mobilization shows that nationalism cannot be fully managed—neither technologically nor ideologically.

2. The Role of Social Media

   Social media amplify nationalist narratives through algorithms that favor emotional content. Yet they are more than propaganda tools: they also provide space for counter-movements—through humor, creative self-criticism, and alternative discourses.

3. Nationalism as a “Double-Edged Sword”

   On the one hand, nationalism can strengthen social cohesion and political legitimacy in the short term. On the other hand, it risks causing division, isolation, and internal instability in the long run.

4. The Global Perspective

   The discussion made clear that phenomena such as nationalism or digital propaganda are not uniquely Chinese problems. They reflect global challenges—from manipulation of public opinion to the question of how societies can deal responsibly with the power of technology.

The evening encouraged participants to see nationalism not as a fixed or monolithic concept but as a multifaceted and evolving phenomenon. Education, media literacy, and regulation were highlighted as essential tools for making digital spaces more democratic and inclusive.

Florian Schneider

Florian Schneider (PhD, University of Sheffield) is Professor of Modern China at the Leiden University Institute for Area Studies and Director of the Leiden Asia Centre.

He is the editor of the academic journal Asiascape: Digital Asia and author of Staging China: The Politics of Mass Spectacle, China’s Digital Nationalism, and Visual Political Communication in Popular Chinese Television Series.

Recognized as an expert on governance, digital media, and political communication in China, he received the Leiden University Teaching Prize in 2017 for his innovative pedagogy. His research focuses on the role of digital technologies and visual communication in Chinese politics and society.

 Semiconductors are the heart of the modern economy and are crucial for national security. Accordingly, they stand at the center of the technological rivalry between China and the United States. The global semiconductor value chain is highly fragmented, characterized by extensive international division of labor, strong specialization, and high barriers to market entry. As a technology on which virtually every sector of the economy depends, access to the necessary types of semiconductors has direct implications for a nation’s economic and national security.

At the ChinaForum of the MoneyMuseum Zurich, held on April 4, 2024, at the Club Baur au Lac, Jan-Peter Kleinhans, Director of the “Technology and Geopolitics” program at the Stiftung Neue Verantwortung, provided insights into the world of semiconductors, the dependencies of the global semiconductor value chain, the competitiveness of China’s ecosystem, and the resulting implications for Europe.

Kleinhans began by clarifying a common misconception: there is no such thing as “the” semiconductor. Instead, there are many different types. For example, semiconductors used in power electronics differ fundamentally from those used as microcontrollers. Depending on their end use, the product requirements can vary enormously. Specialized microcontrollers used in the automotive industry, for instance, must remain fully functional even at 125°C. These variations have led individual firms to specialize in specific niches within the semiconductor industry.

The complexity of the industry is compounded by extreme division of labor along the global value chain. Only a handful of companies, known as Integrated Device Manufacturers (IDMs), perform several steps of chip production in-house. Even they, however, rely on third-party production machinery. Most companies specialize in only one or a few stages of production — for example, Apple and Nvidia focus on chip design, while TSMC in Taiwan specializes in the highly complex process of wafer fabrication.

This multitude of global players makes it difficult to clearly identify dependencies. Nonetheless, Kleinhans pointed out that critical dependencies in the supply of certain key semiconductor types are a real concern. For instance, a single company dominates an indispensable step in the manufacturing of cutting-edge chips: the Dutch lithography machine producer ASML. Without ASML’s tools, none of the world’s most advanced chip factories could function. Similarly, South Korean companies dominate DRAM memory production. These “chokepoints” are of enormous geopolitical significance.

According to Kleinhans, these chokepoints play a key role in the technological contest between the United States and China. Washington, through export controls, industrial policy, and alliances, aims to prevent China from gaining a dominant position in advanced semiconductor manufacturing. Beijing, on the other hand, is acutely aware that it still lags far behind the global leaders in several key segments. In chip design software, for example, Chinese firms are estimated to be 5 to 10 years behind their American counterparts. China therefore remains highly dependent on foreign suppliers and is far from technological self-sufficiency.

Nevertheless, the development of China’s semiconductor ecosystem should be taken seriously. U.S. restrictions have succeeded in slowing China’s progress in cutting-edge chips, but Chinese firms are rapidly becoming more important in other areas of the semiconductor value chain, with enormous growth potential. This potential stems largely from China’s vast domestic demand. Major consumer industries — cloud computing, smartphones, and electric vehicles — account for roughly 70% of global chip demand. Although foreign suppliers still dominate, Chinese firms are expanding quickly, a trend accelerated by U.S. export controls. For example, revenues of Chinese manufacturers of semiconductor production equipment have quadrupled in the past five years. A Chinese ecosystem is clearly emerging, even if the country remains excluded from the most advanced nodes for now.

What does this mean for Europe?

In recent years, the European Union has recognized the need to identify and reduce critical dependencies while protecting strategic industries such as semiconductors. The pandemic-induced supply shortages and the industrial policies of both the U.S. and China have made this urgent. The EU Chips Act aims to double Europe’s share of global semiconductor production from 10% to 20% by 2030. However, the initiative faces several obstacles — limited resources, lack of technical expertise, and, as Kleinhans notes, an absence of strategic coherence. Unlike the U.S., Europe’s primary objective is not to deny China access to chokepoints, nor does the Chips Act focus on securing long-term European chokepoints to maintain stabilizing interdependencies.

In the final discussion, Kleinhans ventured a look into the future. A complete decoupling between China and the rest of the world is unlikely, he argued, because the semiconductor industry is simply too globally interconnected. A partial decoupling, however, is plausible — particularly in markets where China is both a major producer and the largest consumer, such as the automotive sector. There, China’s vast domestic demand will likely have the strongest impact on future global value chains. Yet, as Kleinhans concluded, steering this demand through industrial policy or export controls will remain a formidable challenge.

The Expert

 Jan-Peter Kleinhans is a renowned expert in the field of technology and geopolitics. As Director of the “Technology and Geopolitics” program at the Stiftung Neue Verantwortung, he brings deep expertise at the intersection of technology, economics, and international politics.

China’s Digital Yuan and the Geopolitics of New Financial Infrastructures

Summary of the lecture by Dr. Maximilian Mayer, University of Bonn,

held on November 28, 2023, at the Club Baur au Lac in Zurich.

Lecture and discussion series “China – Challenge and Opportunity,” 2023

 China is taking the lead in the digitalization of its currency and the introduction of blockchain systems. These innovative developments must be viewed against the backdrop of rising geopolitical and geo-economic tensions. The launch of digital central-bank currencies and cryptocurrencies requires new global infrastructures that move within a field of tension between integration and geopolitical exclusion.

What exactly is the digital yuan, China’s central-bank digital currency launched by Beijing? What challenges does China face in strengthening the role of its digital currency both domestically and abroad—and thereby possibly reducing its dependence on the U.S. dollar? And what could this mean for our global monetary order?

Dr. Maximilian Mayer from the University of Bonn addressed these and other questions in his lecture on November 28 at the Club Baur au Lac in Zurich.

At the outset, Mayer explained that the renminbi—introduced in 1949–1950 and literally meaning “people’s money”—serves not only an economic but also a political function within the Chinese system. The People’s Bank of China does not act independently but follows, within the dual Party-State structure, the dictates of the Communist Party. One of Beijing’s central goals, he said, is to ensure very tight macroeconomic and financial control, as reflected in the recently tightened capital-flow restrictions. Because of this lack of practical convertibility, the renminbi (or yuan) cannot currently function as a truly global currency.

Beijing hopes to achieve two things with the digital yuan. First, it seeks to build its own payment ecosystem, independent of private providers such as WeChat Pay or Alipay. Second, it aims to strengthen the yuan globally as a competitor to the U.S. dollar. According to Mayer, neither goal is realistic. One practical issue: how do you persuade a billion potential users to adopt the digital yuan? Despite incentive programs and bonuses, it so far accounts for only 0.16 percent of the cash in circulation. The advantage over existing electronic-payment platforms remains unclear.

For the yuan to gain global traction—the second goal—China would first need to develop the infrastructure enabling the People’s Bank of China (PBoC) to settle such transactions with other central banks. China favors “permission-based blockchains,” which, according to Mayer, pose some of the greatest technical and regulatory challenges compared with other nations’ approaches.

To experiment with this, China launched the mBridge pilot project, aiming eventually to process cross-border payments in digital currencies without relying on SWIFT. This development is positive, Mayer said, and its governance structure is decentralized—or multipolar—rather than controlled by Beijing. It offers a glimpse of what future global monetary infrastructure might look like. Still, the yuan itself remains non-convertible.

Technically, the digital yuan does not operate directly on a blockchain, though the wallets that hold it do. Connections with systems in other countries would again rely on blockchain technology. One major hurdle is the massive data volume, which makes transactions slow. Crucially for Beijing, unlike cryptocurrencies, the PBoC can still maintain monetary sovereignty and uphold capital-control policies.

To replace the dollar, China would need both to loosen macroeconomic controls and to build the necessary infrastructure. The former seems unrealistic for now. While mBridge exists as a pilot, and China conducts part of its bilateral trade with Saudi Arabia in yuan and riyals, this remains the only area where partial decoupling from the dollar is occurring.

Mayer does not foresee a bifurcation of systems. They are still largely interoperable on a technical level. In fact, he sees a trend toward greater interconnection. Nevertheless, the so-called “weaponization of interdependence” has motivated countries like Brazil, India, China, and Russia to seek more independence from the dollar—though this remains unrealistic at present.

In the discussion that followed, Mayer tempered expectations of a near-term digital euro. He also addressed questions about the future role of Bitcoin (“unlikely as a currency, but it will persist as an asset”), the status of Hong Kong’s financial center (“the regulatory environment has deteriorated dramatically”), the programmability of the digital yuan (a problem, since it would undermine fungibility), and potential “Orwellian” motives of governments using digital currencies to combat shadow economies (“it is indeed a defensive struggle to preserve monetary sovereignty”). He concluded with a forward-looking remark: international monetary governance is likely to become multipolar—but we may someday find ourselves nostalgic for the era when the system was controlled by a single actor.

The Expert

Dr. Maximilian Mayer

Dr. Mayer is Assistant Professor of International Relations and Global Technology Policy at the University of Bonn. He previously taught at the University of Nottingham Ningbo China, the Technical University of Munich, Tongji University in Shanghai, and the Center for Global Studies at the University of Bonn. His research focuses on infrastructures and technology in international politics as well as China’s technology, foreign, and energy policy. He has authored numerous scholarly articles and co-edited The Global Politics of Science and Technology.

At the ChinaForum hosted by the MoneyMuseum in Zurich on November 16, 2023, journalist and China expert Frank Sieren discussed the theme “China’s Rules – How China Defines the New World Order.” Drawing on insights from his book China to Go, Sieren argued that China’s rise marks not just a geopolitical shift but an epochal transformation in which the “Western minority can no longer dictate the rules of the global majority.” Under China’s leadership, he said, much of the Global South is asserting its own principles and demanding reform of global institutions, rejecting the West’s “rules-based order.”

Sieren began with a look back at Mao Zedong, whose image and ideology remain deeply rooted in China’s collective consciousness. Mao’s legacy, he explained, still shapes national thinking and resonates in Xi Jinping’s “Chinese Dream,” a vision connecting Mao’s revolutionary ideals with a promise of national rejuvenation and global prominence.

Demographically, Sieren noted, China faces a rapidly aging population and has therefore relaxed immigration policies to attract foreign talent, especially in science and technology. The country is seeking to become a magnet for international experts through new visa programs and incentives.

A central pillar of China’s global strategy, he said, is technological self-reliance, particularly in the race for chip supremacy. While the U.S. share of global chip production has fallen from 37% to 12% since 1990, China has surged from zero to 15%. Trump’s export bans triggered shortages and industrial disruptions, yet also spurred Beijing to invest massively in domestic semiconductor capacity, achieving a milestone in 7-nanometer chip production. In the long run, Sieren warned, U.S. sanctions might accelerate China’s technological catch-up rather than hinder it.

Beyond chips, China is positioning itself as a leader in innovation, aiming to dominate electric mobility by 2025 and advancing quickly in autonomous aerial technology, with flying passenger drones like the EH216-S nearing commercial readiness. In healthcare, China’s biopharmaceutical industry has reached world-class standards, exemplified by the FDA’s 2022 approval of Toripalimab, a cancer drug that may drive down global treatment costs.

On the geopolitical stage, Sieren highlighted the growing influence of BRICS nations—Brazil, Russia, India, China, and South Africa—representing 40% of the world’s population and 30% of global GDP. These countries increasingly shape G20 policy and seek new governance models independent of the G7, though internal divisions, particularly over Russia’s war in Ukraine, persist.

Economically, he identified a historic turning point: in April 2023, cross-border payments in yuan surpassed those in U.S. dollars for the first time. The yuan is gaining traction as a trade currency, particularly in emerging economies like Brazil, Russia, and the ASEAN bloc. The digital yuan could further expand its influence and eventually challenge the dollar’s dominance, signaling a potential shift in the international monetary system.

Domestically, China’s growth depends increasingly on domestic consumption, which accounted for two-thirds of GDP growth in 2021 but remains far below U.S. levels. Rising middle-class prosperity and confidence are essential, yet public discontent—manifested in “consumption strikes” after the zero-Covid policy—reveals growing social sensitivity.

Finally, Sieren noted that Sino-German relations have stabilized after tensions around Foreign Minister Baerbock’s visit, with renewed pragmatism evident in the 2023 intergovernmental consultations. Germany, he concluded, has realized that decoupling is riskier than continued engagement, even amid profound political and cultural differences.

Chinese is the language with the largest number of native speakers in the world. Over the past four decades, China has developed into an indispensable global player. Yet the Chinese language poses many challenges and pitfalls. What makes it so unique—and at the same time so difficult to learn? And why is a solid understanding of the Chinese language and its sociocultural context more important today than ever before?

In their China Forum lectures on March 13 at the Club Baur au Lac in Zurich, Prof. Dr. Andreas Guder and Dr. Marina Rudyak explored these questions.

Prof. Guder pointed out that today’s People’s Republic is a multiethnic and multilingual state—something still visible on its banknotes, which display five languages. While Standard Chinese (Putonghua) serves as the official language, nearly half the country still speaks so-called non-Sinitic languages—tongues of ethnic minorities that together make up roughly 10% of China’s population. The oldest evidence of the Chinese writing system dates back to around 1300 BCE, making it over 3,500 years old—and today, it remains the only non-phonographic writing system still in use anywhere in the world.

But what makes this language so hard for us to learn? One reason, Guder explained, is that Chinese has only about 400 basic syllables used to distinguish words. Including the four tones, that number rises to about 1,200—still fewer than Japanese. As a result, most Chinese words today consist of at least two characters or syllables. To simplify matters, the People’s Republic introduced simplified characters in 1964.

Even so, Guder noted, most sinology students in Germany finish their studies at roughly B1 language level, reaching B2 level only after an extended stay in China—comparable to that of a sixth-grader in China who already knows about 3,000 characters, covering 98% of the words used in daily life. For this reason, Guder calls for a rethink in how language acquisition is prioritized within Europe’s education system. Beyond immersion in the language and culture itself, he also emphasizes the role of language academies and translator-interpreter programs as essential to strengthening European China competence.

In the second part of the evening, Dr. Rudyak presented insights from the Decoding China Dictionary, which she co-initiated with David Bandurski, Katja Drinhausen, Jerker Hellström, and Malin Oud. Rudyak sees a global struggle over discursive power, noting that since 1989 the Chinese government has intensified efforts to redefine terms like democracy and human rights in ways that align with the ideology of the Chinese Communist Party (CCP).

She illustrated this with a quote from Xi Jinping at the United Nations:

“Let us work together to uphold and share the common values of peace, development, equality, justice, democracy, and freedom, and jointly build a new type of international relations.”

Behind phrases such as “a new type of international relations,” she explained, lie hidden messages—for example, the intent to reshape the existing international order according to China’s own preferences. We must be aware of this, she stressed.

Rudyak then discussed several core terms from the Decoding China dictionary.

Take democracy, for instance: before Xi Jinping, the narrative was that China was “too large for democracy.” Since 2014, however, China has begun to present itself as “the better democracy.” At the Munich Security Conference, former Foreign Minister Wang Yi elaborated that the true measure of democracy and human rights is whether a country’s people are satisfied and happy—a fundamentally different understanding from that in the West.

As another example, in response to international criticism after the Tiananmen crackdown in 1989, China formally outlined its own concept of human rights in 1991. Rather than emphasizing universal values, China stresses sovereignty and non-interference. For Beijing, the right to development is the highest human right, and collective interests always outweigh those of the individual. Thus, the Hong Kong protesters were described as troublemakers violating the legitimate rights of the majority.

During the ensuing discussion, the question arose whether this type of linguistic coding—or Newspeak—is uniquely Chinese. “No,” Rudyak replied, “every state has something like this.” However, because of China’s growing global importance, it now matters more than ever. For instance, many German politicians believed they were genuinely discussing human rights in talks with Chinese counterparts, without realizing that the Chinese side meant something entirely different.

According to Rudyak, the Decoding China Dictionary aims to enable what she calls “informed engagement” and foster strategic empathy—a better understanding of China’s strategic motives. This, she concluded, is only possible through language, which offers access to the worldviews, ideology, and history that shape China’s thinking.

The Speakers

Prof. Dr. Andreas Guder

Professor of Chinese Language and Literature and of Chinese Language Didactics at the Free University of Berlin. Chair of the German Association for Chinese Studies since 2004, his research focuses on fundamental questions of didactics and on teaching objectives in Chinese language education.

Dr. Marina Rudyak

Academic researcher at the Institute of Sinology, University of Heidelberg, and currently Acting Professor for Society and Economy of China at the University of Göttingen. Her research centers on China’s development policy and foreign policy discourse. She previously worked as a development policy advisor for the German Corporation for International Cooperation (GIZ) in Beijing.

When Western observers think of China’s digital transformation, they often oscillate between two images: a surveillance dictatorship and an innovation powerhouse. Kristin Shi-Kupfer, professor of contemporary Chinese studies at the University of Trier, argues that the truth lies in the tension between these extremes. In her Zurich lecture “Digital China – People Between Power and Powerlessness”, she explored how individuals—citizens, entrepreneurs, and officials—shape and are shaped by China’s digital society.

Shi-Kupfer began by noting that China’s population is now among the most digitally connected in the world. Mobile phones are omnipresent, serving as tools for communication, payment, and access to government services. This leapfrogging of traditional technologies—China skipped landlines and credit cards—has created an ecosystem dominated by domestic apps like WeChat, Alipay, and Douyin. Since the mid-1990s, the state has consciously protected this “Internet sovereignty,” shielding Chinese companies from foreign competitors and enabling the rise of national champions such as Alibaba and Tencent.

Yet China’s digital modernity comes with paradoxes. While citizens are deeply engaged with digital technology, they are increasingly aware of its dangers. Scandals such as the misuse of health-tracking apps in Henan have heightened sensitivity to data abuse. Still, unlike in Europe, China’s privacy laws apply to companies—but not to the state. This duality—vigilance toward private data collectors, tolerance toward state control—reveals a unique balance between trust and fear in Chinese society.

Shi-Kupfer identified three enduring dynamics shaping China’s digital landscape since the late 1990s. First, the tension between the party’s desire for control and the dynamism of private tech firms. Second, the rise of moral conservatism and patriotic values that increasingly influence media and consumer behavior. Third, a growing ambivalence among citizens, who both embrace digital innovation and fear its intrusive side.

To analyze these complexities, Shi-Kupfer proposed focusing on “the human factor”—individuals and groups who navigate, resist, or reinforce digital power structures. She mapped out several archetypes: planners and implementers balancing central directives and local realities; entrepreneurs torn between vision and party allegiance; developers wielding technical power but lacking creative freedom; activists and artists pushing boundaries through online expression; and users oscillating between self-presentation and subversion. This actor-centered view reveals a China where creativity, control, and contradiction coexist.

Looking ahead, Shi-Kupfer outlined three trends. First, an intensification of ideological and moral control, even extending to Western companies operating in China. Second, the likelihood that growing tensions could lead to fractures within the digital system. And third, the emergence of refreshing, rebellious creativity that escapes state control—most visible in digital art and the NFT scene.

The subsequent discussion raised key questions: Can China’s model be exported? How much autonomy remains for civil society? Does TikTok serve as a cultural bridge—or a tool of manipulation? Shi-Kupfer’s nuanced answer invites neither condemnation nor idealization. China’s digital transformation, she suggests, mirrors the struggle of human beings everywhere: to find meaning, freedom, and dignity in a world increasingly mediated by data and algorithms.

Prof. Kristin Shi-Kupfer is Professor of Contemporary Chinese Studies with a focus on digital media at the University of Trier and a Senior Associate Fellow at the Mercator Institute for China Studies (MERICS) in Berlin. Her research examines Chinese politics and society, digital transformation, social groups and media, media policy, human rights, and religion (especially Christianity) in the People's Republic of China.

Prof. Klaus Mühlhahn began by emphasizing that one of the major questions of our time is how to understand China's rise. He deliberately approached this question through the lens of institutions -- the socially legitimized rule systems that regulate coexistence. Looking back to the Qing dynasty's founding in 1644, he argued that many institutions established then--such as the civil service examination system and early corporate forms--still influence China today.

Mühlhahn noted that up to around 1830, the Chinese population's standard of living, prosperity, and technological sophistication compared favorably with that of Europeans. A vast integrated economy, a silver-based monetary system, state investment in infrastructure, low taxes, efficient markets, and relative peace made this possible under a largely "laissez-faire" government. Yet within a century, China fell dramatically behind the West economically.

By the early 19th century, China accounted for nearly one-third of global GDP, but industrialization in the West, military and commercial conflicts with foreign powers, and domestic crises reduced this share to below 10% by 1900 and under 5% by 1950. Western imperialism, viewing China as both market and strategic prize, collided with an empire unable--or unwilling--to modernize. Chinese silk production, for example, was crushed by British machine-made textiles, while currency crises, floods, and crop failures deepened the decline. Most critically, China's political institutions failed: rather than reforming, elites focused on maintaining power--what Mühlhahn called "elite capture."

Even after the fall of the empire in 1911, China remained trapped in turmoil, and new political experiments largely failed. The Communist victory in 1949 filled this institutional vacuum by adopting a Soviet-style governance model - one profoundly ill-suited to China's realities. Lacking technical expertise, the government's plans led to disasters such as the Great Leap Forward and the Cultural Revolution.

After Mao's death, Deng Xiaoping's leadership marked a pragmatic turning point. With controlled institutional experimentation--beginning with de-collectivization of agriculture -- Deng preserved what worked and abandoned what didn't. Massive state investments in infrastructure, technology, and education triggered spectacular growth. Record levels of foreign investment and new incentives attracted technology and capital. The result: a hybrid institutional system mixing state-owned enterprises that still embody socialist ideals with an expanding private sector that has produced world leaders in innovation.

Yet, according to Mühlhahn, the very institutions that powered China's rise now create new strains -- environmental degradation, social inequality, and limited domestic consumption. Progress requires more participation and feedback loops to correct policy failures. However, the Communist Party's fear of losing control prevents such reforms--e.g., it still bans independent labor unions. Mühlhahn argued that greater civic participation would make China's institutions fairer and more legitimate.

In the ensuing discussion, Mühlhahn highlighted that China between 1620 and 1820 already had a vibrant participatory culture, including intellectual salons--a kind of "Chinese Enlightenment." He also discussed issues of historical consciousness, the Taiwan question, and the lack of an open error culture. One participant suggested creating political special zones, modeled after economic ones, to enable controlled innovation. Mühlhahn concluded that China need not copy Western democracy but must find its own forms of participation.

The Expert:

Prof. Klaus Mühlhahn is a renowned German sinologist and author of Making China Modern -- From the Great Qing to Xi Jinping, now a standard reference on modern Chinese history, focusing on institutional evolution since 1644.

During the Cultural Revolution (1966–1976), the rallying cry for the Red Guards was 打破旧世界，创立新世界 (dapo jiu shijie, chuangli xin shijie) – “destroy the old world, create a new one.” In their revolutionary zeal, Mao’s followers aimed to eradicate the “Four Olds” – old ideas, culture, customs, and habits – and to build a completely new world. Under Deng Xiaoping, China embarked after 1978 on an unprecedented economic surge, often with less regulated markets than many industrialized nations. Yet the aspiration to create a new world in the name of socialism never disappeared. But what, today, remains socialist in China’s system? Do we underestimate the ideological relevance of Chinese socialism, which officially claims still to be in its “initial stage”?

These were the questions explored by Professor Dirk Schmidt in his lecture—the second event in the 2022 China lecture series organized by the MoneyMuseum in collaboration with the China Macro Group.

Schmidt began by noting that “in the West, socialism is no longer taken seriously.” Since the collapse of the Soviet Union, it has been seen as an “ideology of failure.” In China, by contrast, socialism is regarded as an ideology of liberation and modernization, one that made the country’s return to global prominence possible. Western observers, Schmidt argued, often judge China’s system through their own conceptual frameworks, interpreting the country’s economic miracle as the result of capitalist liberalization. Such simplifications, he warned, underestimate the enduring role of state planning and the Communist Party—institutions that remain central to China’s “socialist market economy,” now more than ever under Xi Jinping.

According to Xi, China’s rise was not achieved despite socialism, but because of it. He is even reported to have told U.S. President Joe Biden, “Your system is doomed to fail because you spend all your resources on trivialities like election campaigns—there’s little left for real problems.” China now views itself at a turning point, confident that its system offers advantages. The Western model of liberal democracy, based on “input legitimacy” through elections, is seen as outdated and inefficient. China instead promotes a kind of meritocracy, where “output legitimacy” and performance determine authority.

This can be observed in China’s industrial policy. Those who once doubted China’s efficiency have been proven wrong. The incentive structures embedded in the cadre system have shown remarkable effectiveness, and under Xi, market forces have been increasingly harnessed to serve political goals. For Western firms, this means their economic interests will be respected only insofar as they contribute to China’s socialist modernization goals by 2035.

Schmidt urged Western audiences to think “out of the box.” Statements like “decoupling is impossible” are unhelpful if we wish to prepare strategically for the future. We must learn to think the “unthinkable” and overcome our confirmation bias. The Leninist discipline and spirit of sacrifice within Chinese socialism, he added, should not be underestimated—especially in times of external crisis such as the COVID-19 pandemic. The goals and methods of the Chinese Communist Party are publicly stated in official documents; these must be read carefully and their implications understood.

In the discussion that followed, Schmidt observed that a full decoupling would expose Western industries’ deep dependence on China’s production ecosystems. Yet it would also hurt Beijing: China still relies heavily on foreign technology and cannot easily withdraw from global markets. In the short to medium term, Schmidt identified the ideological hardening under Xi as China’s greatest internal obstacle—it risks stifling creativity and entrepreneurial initiative.

His concluding advice: to deal with China effectively, the West must learn to think long-term, as China does, if it wishes to maintain competitiveness and resilience.

Prof. Ralph Weber, Chair of European Global Studies, University of Basel - May 2022, Club Baur au Lac, Zurich

Many have predicted the end of the Chinese Communist Party (CCP).

In 2015, David Shambaugh wrote in the Wall Street Journal that "the endgame of Chinese Communist rule has begun." Yet, just a few years earlier, in his 2008 book China's Communist Party: Atrophy and Adaptation, he had described a resilient CCP.

So, where does the 95-million-member party stand today? Which factors argue for or against its resilience? And what does the current Omicron crisis mean for Xi Jinping, who in the fall hopes for a third term in office?

Ralph Weber, Professor of European Global Studies at the University of Basel, addressed these questions in his lecture on May 17 at the Club Baur au Lac. This event marked the opening of this year's China lecture series organized by the MoneyMuseum in collaboration with the China Macro Group.

At the outset, Professor Weber made clear that he does not see Xi Jinping's third term in serious jeopardy--despite the ongoing Covid lockdowns. The Party, he argued, has skillfully used the post-Soviet external environment to "normalize" or "depoliticize" its own rise. Domestically, Deng Xiaoping had gradually opened China while never abandoning the socialist path. Western observers, Weber noted, were often too quick to hope for democratization--sometimes even "played" by the Party itself.

Weber identifies here a fundamental flaw in the concept of "change through trade." Western economic interests, combined with deliberate "perception management," made us believe that ideology no longer mattered. But it was never gone. The CCP constitution still states that the Chinese people must fight forces--both domestic and foreign--that oppose or attempt to undermine the socialist system.

Like Shambaugh, Weber sees 2008--the year of the Beijing Olympics and the Tibet demonstrations--as a turning point toward authoritarianism. Under Xi Jinping, China has become "an authoritarian regime with totalitarian tendencies." We should not forget this, he warned, even though globalization and the fall of the Soviet Union had led many to believe that Marx and Lenin were relics of the past.

Under Xi, the Party's influence over business and civil society has grown significantly. Through co-optation, manipulation, disinformation, and the strategic placement of personnel, it seeks to consolidate its "discursive power" and control the prevailing narrative. Xi, Weber said, has faced a dual and difficult mandate from the start: to strengthen both the economy and the Party. To understand this, "we need a sociology of the Party."

Few people or companies in the West, he argued, study in detail the individual actors within China's state and party structures and grasp the nuances. What is clear, however, is that under Xi, loyalty has again become central--visible even in the admission process of the many new party members, as Weber illustrated with a concrete example-

What could cause the Party to lose power? Of four possible scenarios--a self-reform, a military coup, internal political opposition, or a popular uprising--Weber sees none as likely at present. The repressive apparatus remains strong enough to sustain an increasingly rigid system, despite public frustration over the handling of the Omicron outbreak in Shanghai.

In the ensuing discussion with roughly fifty attendees, Weber emphasized that Xi is not solely responsible for China's authoritarian shift--it began under Hu Jintao. Yet under Xi, the "political, theoretical, and emotional identification" with the Party has intensified, as the official rhetoric puts it.

He also stressed that to understand China under Xi, we must once again engage with Lenin and Mao. When asked about local experiments in democracy, Weber was clear: though there were some pilot initiatives in the early 2000s, they have long since disappeared.

Should we, then, reassert our own values? Yes, Weber concluded. China's renewed ideological self-confidence should prompt us to reflect on which of our values are non-negotiable--such as human rights. Still, showing his personal connection to the country, he ended with a call for informed and nuanced engagement: we must not be naïve in dealing with China, but xenophobia is not the answer.

The Expert

For this four-part lecture series on China, which approaches the global power from different perspectives, it was essential to dedicate one lecture entirely to the CCP. Ralph Weber, who has studied Chinese political philosophy in depth, is among Switzerland's most knowledgeable experts on the Chinese political system.

Outlook

The next lecture, scheduled for Thursday, June 9, 2022, will feature Professor Dirk Schmidt from the University of Trier. He will examine China's economic policy in his talk "Turning Point -- The Return of Socialism in the Chinese Economy." Schmidt specializes in Chinese foreign and security policy, political economy, and relations between the PRC and Taiwan.