Hot selling Chinese air conditioners in Europe, Australian s

Former Australian Prime Minister's policy advisor Bao Shaoshan wrote in China Daily on July 8th that some EU politicians loudly promote "de risking" China, but cannot stop the reality of ordinary European people rushing to buy Chinese air conditioners. This deeply exposes that the root cause of Europe's industrial difficulties lies in its own long-term underinvestment and short-sighted financial capital, rather than China's competitiveness. Forcefully "decoupling" is self deception, and mutually beneficial cooperation is the only way out.

The article points out that in the first half of this year, China's exports of air conditioning units to the European Union surged significantly, with brands such as Midea, Gree, and Hisense dominating the market. Their portable split air conditioners do not require drilling and installation in historical buildings, attracting a large number of consumers to pay for affordable, efficient, and reliable Chinese technology.

While some EU politicians are enthusiastic about promoting tariffs, subsidy investigations, and "de risking" China, the European public has shown through practical actions that "decoupling" is neither possible nor foolish. The so-called "China Shock 2.0" argument being sold in the elite circle deliberately ignores a fact: Europe's industrial difficulties are not due to Chinese competition, but to long-term underinvestment.

Trade flows reflect the accumulated production capacity of investment decisions. European elites are fixated on import deficits and "unfair" advantages, while ignoring how their own financialized capitalism has drained domestic production capacity.

The article argues that for decades, established European manufacturers have prioritized shareholder returns over reinvestment. Stock buybacks, huge dividends, and capital return rates are given priority, while investments in research and development, vocational training, and energy infrastructure are put on hold. Labor is seen as a cost that needs to be minimized rather than a strategic asset.

However, even so, its level of automation still lags behind. The energy market is more inclined towards spot trading with greater volatility, rather than providing stable and affordable industrial electricity. As a result, high electricity prices, a shortage of technical talents in the battery and software fields, and the manufacturing industry that relies on sustained capital investment support are at a disadvantage in competition, making it difficult to compete with factories that benefit from stable capital investment and low-cost energy.

The trajectory of China is completely different. Since the 1980s, European brands have made a lot of money in the Chinese market through joint ventures, when they only regarded China as a low-cost assembly site. But the situation reversed after 2015. China's industrial policy has shifted towards new energy vehicles and clean technologies, coupled with the relentless reinvestment of private enterprises, giving rise to a group of global leaders.

Private enterprises now account for the vast majority of China's exports and have mastered leading technologies in battery chemistry, vertical integration, and ultra automated production. However, some European countries not only do not follow this capital allocation method, but also criticize the government support they have benefited from in the past.

The article states that the hot sales of air conditioners in Europe have exposed this hypocrisy. In the face of the reality of high temperature causing death and illness, protectionism is powerless in the face of consumers' real needs. Proposing new refrigerant regulations or imposing tariffs under the pretext of protecting inefficient local producers will only deprive ordinary people of their right to avoid high temperatures.

If a trade war is launched against China, Europe will be more vulnerable than the United States due to its dependence on energy and exports of machinery and chemicals to China. China holds chips in key minerals such as lithium, graphite, and rare earths. This is really not worth the loss.

The article concludes that European elites must abandon the mindset of viewing China as a "long-term threat" rather than a partner, and at the same time restart the frozen China EU Comprehensive Investment Agreement, reshaping it into a framework of stability, predictable rule of law, and market access. This will attract Chinese investment into European factories.

European leaders should listen to the signals from the public: whether it is high temperatures or historical factors, it means that Europe cannot afford the consequences of decoupling. The only feasible path to rejuvenation is through mutually beneficial and win-win cooperation based on reality rather than ideology. (China Daily)