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Monthly Archives: October 2026 - 4. page

Germany Faces Deepening Manufacturing Downturn Amid “China Shock 2.0”

Germany is facing growing pressure on its manufacturing sector as exports to China and industrial employment decline. According to the Centre for European Reform, exports to China from all major European economies except the Netherlands have fallen over the past five years, with Germany and Sweden recording some of the sharpest declines. Germany’s exports to China as a share of GDP fell from about 0.71 percent in 2022 to 0.48 percent in 2025. Jürgen Matthes of the German Economic Institute estimated that China-related exports supported about 1.1 million German jobs at their 2021 peak, but roughly 400,000 have since disappeared.

The employment losses have triggered growing labor unrest. On September 21, more than 175,000 workers joined a nationwide strike, disrupting production at more than 200 factories. Germany’s industrial sector is reportedly losing about 15,000 jobs per month. Volkswagen expects its 2026 revenue to fall by €6.9 billion from the previous year and plans to cut 50,000 jobs in Germany by 2030. Porsche reported a 16 percent decline in global vehicle deliveries in the first half of 2026, while auto-parts supplier ZF reported a €2.1 billion loss and plans to eliminate 11,000–14,000 German jobs by the end of 2028.

The broader EU-China trade imbalance has also widened. European Commission President Ursula von der Leyen warned on September 16 that the EU’s trade deficit with China had reached €1 billion per day and that the economic relationship was approaching a “tipping point.” Eurostat data showed an EU goods trade deficit with China of €359.8 billion in 2025, while the second quarter of 2026 alone recorded a deficit of €103 billion. Germany’s trade deficit with China reached €89.9 billion in 2025, while German exports to China fell another 14.5 percent in the first five months of 2026.

Analysts have described the trend as “China Shock 2.0,” with Chinese competition increasingly affecting Germany’s exports and domestic industrial production. MERICS economist Esther Goreichy said the pressure was hitting two major pillars of Germany’s economy—exports and industrial production. The report also highlights BASF, whose Ludwigshafen workforce fell below 30,000 for the first time since 1954, while the company has invested €8.7 billion in a large production site in Zhanjiang, Guangdong.

Source: Aboluo, September 28, 2026
https://www.aboluowang.com/2026/0928/2438857.html

Briefings | | |   Economy/Resources Geo-Strategic Trend

Chip Curbs Reframed: Can China’s AI Models Keep Running on Domestic Computing Power?

An article from the Huxiu business outlet argues that Chinese large models will keep running even if top chips become unobtainable. Domestic chips already carry real workloads and is capable to support the running of large models. Zhipu operates a 100,000-card inference cluster that handles all live traffic for its GLM-5.3-Flash model, and its anonymous Ox-Alpha model has processed 62 trillion tokens on overseas platforms. Meituan trained LongCat-2.0 on domestic hardware. Efficiency lags, though: Huawei’s Ascend 910C reaches roughly 30-35 percent training utilization versus 40-50 percent for Nvidia H100 clusters. Since cost per token depends on chips, software, and model design, firms are optimizing the latter two.

Four firms are taking different paths. Zhipu is going asset-heavy, acquiring compiler firm Zhongke Jiajia and raising $5 billion in September. Management says 30 billion yuan ($4.2 billion) of compute, split 40 percent training and 60 percent inference, could generate up to 40 billion yuan ($5.6 billion) in annual revenue, a theoretical estimate. MiniMax, whose cloud costs exceeded 90 percent of cost of sales, is moving from renting to building domestic clusters that are not yet carrying live traffic. DeepSeek bets on model efficiency, yet raised V4-Pro prices in August due to chip limits; its 160,000-card cluster is reportedly not due until late 2027 or early 2028, and prices may fall once Huawei’s Ascend 950 ships in volume. Kimi uses open-source models and ecosystem partnerships to shorten the adaptation cycle for domestic chips; its models were quickly adapted by Huawei, Alibaba’s T-Head, Hygon, Moore Threads and Biren, but demand after K3’s launch forced it to pause new consumer sign-ups.

Adaptation solves “can run”; owned compute solves “can afford.” The author urges tracking capacity, efficiency, and cost per token, ranking Zhipu the surest short-term bet, DeepSeek the highest-upside medium-term one, and MiniMax and Kimi as unproven.

Source: Huxiu, September 25, 2026
https://www.huxiu.com/article/4893261.html

Briefings | | |   Economy/Resources

Former PLA Eavesdropper and Special Forces Veteran Among Chinese Nationals Accused of Spying in South Korea

Two Chinese nationals with People’s Liberation Army (PLA) backgrounds have been charged or detained in South Korea over alleged military espionage, according to a report that cites a prosecution indictment. The case has fueled suspicion that Beijing is running organized intelligence operations there.

The first suspect, a man in his 60s identified as A, allegedly served 40 years in a PLA signals-monitoring unit under the General Staff Department in Beijing, retiring as a lieutenant colonel. Prosecutors say he intercepted military communications 13 times between March 2024 and August 2026, using radio receivers and antennas set up in hotel rooms near air force towers and runways. Seven of the incidents took place at Gunsan, which hosts both South Korean and U.S. air forces. He allegedly took 13.9 terabytes of recordings and frequency data back to China. He was arrested at a Gunsan hotel after re-entering the country shortly before the Ulchi Freedom Shield exercise. He says it was “a hobby.”

The second suspect, B, is an ethnic Korean Chinese in his 40s and a Chinese Communist Party member who allegedly served in PLA special forces and public security from 1998 to 2006. Running a military-uniform shop near Camp Humphreys, he allegedly cultivated a U.S. soldier and a South Korean civilian employee at U.S. Eighth Army headquarters with meals and gifts. He is accused of obtaining footage of Apache and F-35 training, parachute drills and exercise review materials, then passing summaries to outside parties through Chinese messaging apps and social media. B says he was merely building rapport for his business.

Experts note a string of similar cases, including Chinese nationals convicted for photographing naval and air bases. They warn that dissolving the military counterintelligence command and curtailing prosecutors’ powers, leaving roughly 100 police investigators on counterespionage, could worsen the problem.

Source: Chosun Daily, September 29, 2026
https://cnnews.chosun.com/client/news/viw.asp?nNewsNumb=20260965450

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