Chinese experts have criticized Germany's decision to cease granting promotional loans to China and deny China's developing country status, calling it a move that succumbs to pressure from the US' cold-war mentality toward China. They warn that Germany risks undermining its own economic interests and damaging the investment confidence of European enterprises in China.

Germany will no longer grant promotional loans to China from 2026 and no longer treat China as a developing country, the Federal Development Ministry (BMZ) confirmed on Tuesday. 

The German ministry said it has informed the Chinese Ministry of Finance in mid-September of the federal government's decision to permanently stop granting promotional loans to China, Reuters reported.

"We are no longer treating China as a developing country," German Development Minister Svenja Schulze said. "China is and remains an important partner, without whom we cannot successfully overcome global crises," she added.

The move reflects some German politicians' alignment with the US in strengthening "decoupling" from China and creating economic and trade barriers aimed at the country, Chen Jia, an independent analyst on global strategy, told the Global Times on Wednesday.

Under this Cold War mentality, Germany's push to implement a decoupling policy is not beneficial to EU-China cooperation, Chen noted.

Song Wei, a professor at the School of International Relations and Diplomacy at Beijing Foreign Studies University, said Germany's decision to cease granting promotional loans to China and deny China's developing country status was primarily influenced by US attempts to strip China of its developing country status.

For some time, the US has attempted to deprive China of its developing country status, which has been slammed by Chinese officials.

China's status as the world's largest developing country is rooted in facts and international law. It's not up to the US to decide whether China is a developing country, Chinese Foreign Ministry Spokesperson Wang Wenbin said at a press conference in June.
China's status as a developing country is supported by concrete facts. China's per capita GDP in 2022 was $12,741, or one-fifth of that of advanced economies and only one-sixth that of the US. 

The move by Germany will create an atmosphere of uncertainty, hinder the growth of bilateral trade and investment, and dampen the investment confidence of European business in China, experts said.

China and EU just concluded productive talks during the 10th High-level Economic and Trade Dialogue, with the two sides reaching multiple consensuses, China's Ministry of Commerce said in a statement on Tuesday.

Both sides agreed to further promote the two-way opening of the financial industry and encourage eligible financial institutions to invest and expand their business in each other's markets. 

In the context of a global economic downturn, Germany's cancellation of promotional loans will dampen the investment confidence and expectations of European enterprises in the Chinese market, which is not conducive to the deepening economic and trade cooperation between China and Europe, Song said.

From 2013 to 2022, promotional loans with a total volume of 3.451 billion euros ($3.62 billion) were agreed upon with China. No promotional loans were granted in 2023, according to the Reuters report.

Cui Hongjian, a professor with the Academy of Regional and Global Governance with Beijing Foreign Studies University, told the Global Times that these loans primarily support projects related to infrastructure, climate change, environmental protection, and sustainable development. The advantage lies in their relatively fixed and extendable repayment period, as well as the relatively favorable interest rates compared to market rates. 

Cui said that in the future, there may be a shift toward more commercial cooperation rather than policy-driven projects. Additionally, this change may not have a significant impact on large-scale projects, as the Chinese side has sufficient financial capacity for investment, Cui said.

China's major industrial firms saw their profit surge in August, reversing the downward trend and increasing by 17.2 percent from a year earlier, the latest sign of sustained recovery in the world's second-largest economy as stimulus kicks in.

The robust industry growth, which marks the first increase since the second half of 2022, may pave the way for a full rebound as a slew of economic indicators are also pointing to a positive consumption trend during the upcoming Golden Week holidays, observers said.

With consumption and manufacturing activities all in full swing, the domestic economy is expected to ride on the fast track of stabilizing growth, though challenges remain, they noted.

In the first eight months of the year, the profits of major industrial firms with annual main business revenue of at least 20 million yuan ($2.79 million) reached 4.66 trillion yuan, down 11.7 percent year-on-year, with the pace of decline narrowing by 3.8 percentage points from the first seven months, according to data released on Wednesday by the National Bureau of Statistics (NBS).

Of the 41 industrial categories monitored by the bureau, 30 posted better performance in terms of profit during the January-August period, with the losses in raw material manufacturing industry narrowing significantly due to rising commodity prices and recovered demand.

As the country's pro-growth policies continued to show their impact in August, industrial production saw a steady recovery, with the improvement in industrial profit gathering momentum, said NBS statistician Yu Weining.

Profit growth for equipment manufacturing was 3.6 percent for the period, growing from the 1.7 percent registered during the first seven months and leading the overall improvement, Yu said, noting that all business entities recorded better performance.

The reversal in August, reflecting that the overall operating conditions of the industrial sector are improving, was mainly driven by the rebound in market demand, improved prices of industrial products, the effects of macro-support policies, and the low base in 2022, Zhou Maohua, an economist at Everbright Bank, told the Global Times on Wednesday.

The rebound was in line with the momentum of China's official manufacturing purchasing managers' index (PMI) for August, which came in at 49.7, up 0.4 points from the previous month.

A reading below 50 indicates a contraction, while one above 50 indicates expansion.

"The recovery of the PMI represents stable market confidence and projection, and enterprises' profit recovery is the real consequence, which shows that the general situation is improving," Cong Yi, professor at the Tianjin University of Finance and Economics, told the Global Times on Wednesday.

All multiple indicators are upbeat signs for the country's overall economic recovery, and also reflect that a series of supportive measures have taken effect, Cong said.

Notably, in the first eight months of 2023, profit of the electricity, heat generation and supply industry surged by 53.4 percent year-on-year, and profits for electrical machinery and equipment manufacturing increased by 33 percent year-on-year. In addition, profit of auto manufacturing increased by 2.4 percent year-on-year.

NBS data also showed that profit of enterprises in the metal, mineral processing, and energy extraction sectors suffered a decrease, while the profits of coal extraction and washing enterprises declined by 26.3 percent year-on-year, and the profit of chemical raw material and production manufacturing enterprises declined by 51.1 percent.

Structural adjustment of China's industrial enterprises growth is ongoing, and it's a vital period now for shifting the country's economic drive force from traditional industry to emerging sectors, Cong said.

Nevertheless, some domestic industrial manufacturing industries are still in the destocking stage, Zhou said, noting that problems such as insufficient market demand and high cost pressures still pose difficulties for company operations. 

"Domestic macro policy support cannot be relaxed," Zhou said.

Chinese authorities have stressed stronger and more precise measures to bolster the recovery over the past months. In a fresh move on Wednesday, China's central bank said at a quarterly meeting that it would step up policy adjustments and implement monetary policies to expand domestic demand and restore confidence.

During the meeting, the bank emphasized the need to intensify the implementation of existing monetary policies, enhance counter-cyclical and cross-cyclical adjustments, and focus on boosting domestic demand and restoring confidence.

In light of the current domestic and international economic situation, the bank noted that "the current external environment has become more complex and challenging," with inflation remaining high and developed countries expected to maintain elevated interest rates. Additionally, it acknowledged that "the domestic economy continues to recover and improve with strengthened momentum, but still faces challenges such as insufficient demand."

Globally, downward pressure on the world economy has been intensifying. 

According to a Reuters report citing an S&P Global survey, business activity in the US, the world's largest economy, showed little change in September, with the vast services sector essentially idling at the slowest pace since February, and overall new order activity slipping to the lowest level in 2023.

As the 8-day Golden Week holidays approach, tourists are swarming to China's famous landmarks and scenic spots like Tian'anmen Square in Beijing, the Bund in Shanghai, and West Lake in Hangzhou, East China's Zhejiang Province. The vibrant atmosphere, buzzing with excitement and activities, serves as a vivid reflection of the unwavering confidence of the Chinese people in the country's economy and bright future.

An estimated around 800 million travel trips will be made during the eight-day Mid-Autumn Festival and National Day holidays which will kick off on Friday. With record demand for travel and the sustained economic impact of the Asian Games, this year's Golden Week holidays are poised to become the most vibrant and prosperous in recent memory. 

As an important window to observe economic vitality, the upcoming Golden Week holidays will lead a significant consumption rebound in the fourth quarter, playing a crucial role in driving economic growth throughout the entire year, experts said.

Despite downward pressure due to multiple factors, China's consumer market is currently displaying signs of recovery and growth. The resilience, potential, and dynamism of consumption remain strong and unchanged, experts said, refuting Western media and politicians' bearish outlook on Chinese economy.

Hundreds of millions hitting the road

Latest data on holiday travel, accommodation, and tourism products all pointed to a stark rebound from the levels seen in 2019, indicating a remarkable resurgence in consumption activity.

Wednesday marks the first day of the Golden Week holidays travel rush. The railway network in the Yangtze River Delta region is expected to deliver more than 2.5 million passenger trips on Wednesday, 600,000 above the 2019 level, representing growth of over 30 percent, according to China Railway Shanghai Group Co.

According to the China Tourism Academy, over 100 million travel trips will be made per day during the Golden Week holidays, far surpassing the levels of last year and 2019. In terms of commercial aviation, more than 21 million travelers will take flights in the span of eight days and an average of 14,000 domestic flights will be operated per day, up 18 percent from the same period in 2019. China Railway Group forecast that 190 million railway trips will be made during the holidays, up from the 138 million trips seen in 2019.

Hotel bookings for popular destinations have also surged. Data from Qunar showed that domestic hotel bookings for the holidays have increased by 514 percent compared to 2019.

Outbound tourism is expected to see a 20-fold year-on-year increase, according to online traveling platform Trip.com. Travel agency U-tour predicted the number of outbound travelers would exceed this year's May Day holidays by five folds.

According to the National Immigration Administration, the average daily number of inbound and outbound passenger trips during the holidays are expected to reach 1.58 million, three times higher than the same period last year.

Additionally, traveling to Hangzhou, East China's Zhejiang Province has become a spotlight and a unique spark for holidays spending as the eight-day holidays coincide with the main competition days of the Hangzhou Asian Games which last from September 23 to October 8.
Data from the online travel platform Fliggy shows that during the Asian Games, international flight bookings bound for Hangzhou have surged 20 times compared to the same period last year. Train ticket bookings have recorded a 4.7 times year-on-year growth, and hotel bookings near venues have increased by three times compared to last year. The other five cities in the province co-hosting the games also experienced a boom in tourist numbers.

With a substantial surge in bookings for flights, train tickets, accommodations, and tourism products, this holidays break is expected to unleash further consumption potential which vividly illustrates the positive trajectory of the Chinese economy, experts said.

In light of record booking and travel data, indicating a growing consumption enthusiasm, Tian Yun, a Beijing based economist attributed the growth to the lengthier holidays break and spill-out effect of events like the Asian Games, which have injected energy into the economy.
Accelerator of economic growth in Q4

Experts predict that thanks to effective macroeconomic stimulus policies and the boost from the Golden Week holidays, consumption will bounce back strongly in the fourth quarter, playing a crucial role in driving economic growth for the entire year. They have also dismissed smear and bearish outlook painted by some foreign media and Western politicians about the Chinese economy.

China's retail sales, a main gauge of consumption, beat expectations in August thanks to a bumper summer travel peak and consumption-boosting measures, data from the National Bureau of Statistics (NBS) showed.

Driven by the accelerated sales of travel and a wider range of spending options, retail sales of consumer goods in August recorded a year-on-year growth of 4.6 percent to 3.79 trillion yuan ($521.13 billion), 2.1 percentage points higher than the growth rate in the previous month, according to the NBS.

Experts said that the Golden Week holidays and the Asian Games will further accelerate the consumption recovery and economic growth in the fourth quarter, expecting more policy tools to kick in. In addition, the Belt and Road Summit in October and the China International Import Expo in November will both provide a strong boost to China's economy and development.

The extended holiday period provides a significant opportunity for a retail spending peak and is expected to have a significant impact on the GDP growth in the fourth quarter, acting as "an accelerator," Cong Yi, a professor from the Tianjin University of Finance and Economics, told the Global Times on Tuesday.

The Asian Games in particular will be a major boost for consumption-related sectors from sports and culture to catering for the host city and nearby cities in East China's Zhejiang Province as well as the Yangtze River Delta region, Cong added.

According to media reports, citing official information from Zhejiang Province, the preparations for the Asian Games between 2016 and 2020 are estimated to have added about 414.1 billion yuan to Hangzhou's economy, accounting for 7.6 percent of the city's total economic output during that time. It also led to an increase of around 103.3 billion yuan in government revenue, which is about 8.2 percent of the total revenue collected. Additionally, the Games has created job opportunities for approximately 670,000 people, accounting for 2.4 percent of the total employment during that period.

The consumption vitality generated by the Hangzhou Asian Games extends far beyond Hangzhou, with the ripple effect gradually emerging in various parts of Zhejiang Province and even the entire Yangtze River Delta region.

During the Asian Games, hotel bookings in Ningbo, Wenzhou, Huzhou, Shaoxing, and Jinhua cities have all increased by more than fivefold compared to 2019, with Shaoxing experiencing the highest growth rate of 720 percent in hotel bookings.
Beyond the tourism, the sports craze sparked by the Asian Games has ignited the sports economy, sports manufacturing and foreign trade. According to customs data, the export of sports goods from Yiwu, East China's Zhejiang Province reached 5.08 billion yuan in the first eight months of this year, a year-on-year increase of 33 percent.

Tian said that the sustained success of the Asian Games and other major events this year will continue to further drive not only domestic consumption but also international consumption, presenting a window for China's opening-up.

Expert noted that China's consumption potential remains untapped and a massive household saving indicates a significant market for emerging consumer goods and upgraded consumption needs.

By the end of August, the balance of savings deposits for urban and rural residents in China exceeded 7 trillion yuan for the first time, standing at 7.06 trillion yuan.

More can be done to stimulate the consumer market, Tian said, pointing to upgraded consumption demand and new consumption drivers.

New-energy vehicles, domestically produced 5G smartphones, domestically produced large aircraft, and the cruise economy will all become new growth points for China's consumer economy, Tian said.

He is confident that with the government's efforts, the gradual recovery of individuals from the pandemic's impact, the retail sales growth could reach 6 percent in the fourth quarter.

"It is expected that macro policies will focus on creating more jobs and promoting economic growth in the fourth quarter. It will also address long-term issues like aged care to boost market confidence," Tian said.
Li Yong, president of Chongqing Frontier Regional Economic Research Institute, told the Global Times that stimulating consumer spending through the issuance of shopping vouchers is a good method, especially for the catering and tourism sectors, which will encourage people to visit malls and take trips.

Experts also defied attacks by some Western politicians and media outlets that paint the Chinese economy as being at the cusp of collapse.

Cong dismissed smear from foreign media, as the trend of consumption upgrading in China's massive market of 1.4 billion people remains unchanged. He also noted that the bearish view on the Chinese economy is a long-standing line of attack from sections of the Western media, yet it has never managed to drag down China's economy.

"China is well on track to achieve the GDP growth target of around 5 percent for the whole year, and the final quarter growth will solidify the target," Cong said.

Tian predicted China's economic growth to grow at around 5.2 percent for this year.

"Actions speak louder than words. As China remains focused on its economic work, progressing at its own pace and avoiding empty rhetoric, there is no need to pay attention to Western attempts to discredit it," Li said, predicting China's economic growth would finish in a range of 5 percent to 5.2 percent this year.

A man with a hole in his forehead, who was interred in what’s now northwest Alabama between around 3,000 and 5,000 years ago, represents North America’s oldest known case of skull surgery.

Damage around the man’s oval skull opening indicates that someone scraped out that piece of bone, probably to reduce brain swelling caused by a violent attack or a serious fall, said bioarchaeologist Diana Simpson of the University of Nevada, Las Vegas. Either scenario could explain fractures and other injuries above the man’s left eye and to his left arm, leg and collarbone.

Bone regrowth on the edges of the skull opening indicates that the man lived for up to one year after surgery, Simpson estimated. She presented her analysis of the man’s remains on March 28 at a virtual session of the annual meeting of the American Association of Biological Anthropologists.
Skull surgery occurred as early as 13,000 years ago in North Africa (SN: 8/17/11). Until now, the oldest evidence of this practice in North America dated to no more than roughly 1,000 years ago.

In his prime, the new record holder likely served as a ritual practitioner or shaman. His grave included items like those found in shamans’ graves at nearby North American hunter-gatherer sites dating to between about 3,000 and 5,000 years ago. Ritual objects buried with him included sharpened bone pins and modified deer and turkey bones that may have been tattooing tools (SN: 5/25/21).

Investigators excavated the man’s grave and 162 others at the Little Bear Creek Site, a seashell covered burial mound, in the 1940s. Simpson studied the man’s museum-held skeleton and grave items in 2018, shortly before the discoveries were returned to local Native American communities for reburial.

It was one of the biggest climate change questions of the early 2000s: Had the planet’s rising fever stalled, even as humans pumped more heat-trapping gases into Earth’s atmosphere?

By the turn of the century, the scientific understanding of climate change was on firm footing. Decades of research showed that carbon dioxide was accumulating in Earth’s atmosphere, thanks to human activities like burning fossil fuels and cutting down carbon-storing forests, and that global temperatures were rising as a result. Yet weather records seemed to show that global warming slowed between around 1998 and 2012. How could that be?
After careful study, scientists found the apparent pause to be a hiccup in the data. Earth had, in fact, continued to warm. This hiccup, though, prompted an outsize response from climate skeptics and scientists. It serves as a case study for how public perception shapes what science gets done, for better or worse.

The mystery of what came to be called the “global warming hiatus” arose as scientists built up, year after year, data on the planet’s average surface temperature. Several organizations maintain their own temperature datasets; each relies on observations gathered at weather stations and from ships and buoys around the globe. The actual amount of warming varies from year to year, but overall the trend is going up, and record-hot years are becoming more common. The 1995 Intergovernmental Panel on Climate Change report, for instance, noted that recent years had been among the warmest recorded since 1860.

And then came the powerful El Niño of 1997–1998, a weather pattern that transferred large amounts of heat from the ocean into the atmosphere. The planet’s temperature soared as a result — but then, according to the weather records, it appeared to slacken dramatically. Between 1998 and 2012, the global average surface temperature rose at less than half the rate it did between 1951 and 2012. That didn’t make sense. Global warming should be accelerating over time as people ramp up the rate at which they add heat-trapping gases to the atmosphere.
By the mid-2000s, climate skeptics had seized on the narrative that “global warming has stopped.” Most professional climate scientists were not studying the phenomenon, since most believed the apparent pause fell within the range of natural temperature variability. But public attention soon caught up to them, and researchers began investigating whether the pause was a real thing. It was a high-profile shift in scientific focus.

“In studying that anomalous period, we learned a lot of lessons about both the climate system and the scientific process,” says Zeke Hausfather, a climate scientist now with the technology company Stripe.

By the early 2010s, scientists were busily working to explain why the global temperature records seemed to be flatlining. Ideas included the contribution of cooling sulfur particles emitted by coal-burning power plants and heat being taken up by the Atlantic and Southern oceans. Such studies were the most focused attempt ever to understand the factors that drive year-to-year temperature variability. They revealed how much natural variability can be expected when factors such as a powerful El Niño are superimposed onto a long-term warming trend.

Scientists spent years investigating the purported warming pause — devoting more time and resources than they otherwise might have. So many papers were published on the apparent pause that scientists began joking that the journal Nature Climate Change should change its name to Nature Hiatus.
Then in 2015, a team led by researchers at the U.S. National Oceanic and Atmospheric Administration published a jaw-dropping conclusion in the journal Science. The rise in global temperatures had not plateaued; rather, incomplete data had obscured ongoing global warming. When more Arctic temperature records were included and biases in ocean temperature data were corrected, the NOAA dataset showed the heat-up continuing. With the newly corrected data, the apparent pause in global warming vanished. A 2017 study led by Hausfather confirmed and extended these findings, as did other reports.

Even after these studies were published, the hiatus remained a favored topic among climate skeptics, who used it to argue that concern over global warming was overblown. Congressman Lamar Smith, a Republican from Texas who chaired the House of Representatives’ science committee in the mid-2010s, was particularly incensed by the 2015 NOAA study. He demanded to see the underlying data while also accusing NOAA of altering it. (The agency denied fudging the data.)

“In retrospect, it is clear that we focused too much on the apparent hiatus,” Hausfather says. Figuring out why global temperature records seemed to plateau between 1998 and 2012 is important — but so is keeping a big-picture view of the broader understanding of climate change. The hiccup represented a short fluctuation in a much longer and much more important trend.
Science relies on testing hypotheses and questioning conclusions, but here’s a case where probing an anomaly was taken arguably too far. It caused researchers to doubt their conclusions and spend large amounts of time questioning their well-established methods, says Stephan Lewandowsky, a cognitive scientist at the University of Bristol who has studied climate scientists’ response to the hiatus. Scientists studying the hiatus could have been working instead on providing clear information to policy makers about the reality of global warming and the urgency of addressing it.

The debates over whether the hiatus was real or not fed public confusion and undermined efforts to convince people to take aggressive action to reduce climate change’s impacts. That’s an important lesson going forward, Lewandowsky says.

“My sense is that the scientific community has moved on,” he says. “By contrast, the political operatives behind organized denial have learned a different lesson, which is that the ‘global warming has stopped’ meme is very effective in generating public complacency, and so they will use it at every opportunity.”

Already, some climate deniers are talking about a new “pause” in global warming because not every one of the past five years has set a new record, he notes. Yet the big-picture trend remains clear: Global temperatures have continued to rise in recent years. The warmest seven years on record have all occurred since 2015, and each decade since the 1980s has been warmer than the one before.

As astronomy datasets grow larger, scientists are scouring them for black holes, hoping to better understand the exotic objects. But the drive to find more black holes is leading some astronomers astray.

“You say black holes are like a needle in a haystack, but suddenly we have way more haystacks than we did before,” says astrophysicist Kareem El-Badry of the Harvard-Smithsonian Center for Astrophysics in Cambridge, Mass. “You have better chances of finding them, but you also have more opportunities to find things that look like them.”

Two more claimed black holes have turned out to be the latter: weird things that look like them. They both are actually double-star systems at never-before-seen stages in their evolutions, El-Badry and his colleagues report March 24 in Monthly Notices of the Royal Astronomical Society. The key to understanding the systems is figuring out how to interpret light coming from them, the researchers say.
In early 2021, astronomer Tharindu Jayasinghe of Ohio State University and his colleagues reported finding a star system — affectionately named the Unicorn — about 1,500 light-years from Earth that they thought held a giant red star in its senior years orbiting an invisible black hole. Some of the same researchers, including Jayasinghe, later reported a second similar system, dubbed the Giraffe, found about 12,000 light-years away.

But other researchers, including El-Badry, weren’t convinced that the systems harbored black holes. So Jayasinghe, El-Badry and others combined forces to reanalyze the data.

To verify each star system’s nature, the researchers turned to stellar spectra, the rainbows that are produced when starlight is split up into its component wavelengths. Any star’s spectrum will have lines where atoms in the stellar atmosphere have absorbed particular wavelengths of light. A slow-spinning star has very sharp lines, but a fast-spinning one has blurred and smeared lines.

“If the star spins fast enough, basically all the spectral features become almost invisible,” El-Badry says. “Normally, you detect a second star in a spectrum by looking for another set of lines,” he adds. “And that’s harder to do if a star is rapidly rotating.”

That’s why Jayasinghe and colleagues misunderstood each of these systems initially, the team found.

“The problem was that there was not just one star, but a second one that was basically hiding,” says astrophysicist Julia Bodensteiner of the European Southern Observatory in Garching, Germany, who was not involved in the new study. That second star in each system spins very fast, which makes them difficult to see in the spectra.

What’s more, the lines in the spectrum of a star orbiting something will shift back and forth, El-Badry says. If one assumes the spectrum shows just one average, slow-spinning star in an orbit — which is what appeared to be happening in these systems at first glance — that assumption then leads to the erroneous conclusion that the star is orbiting an invisible black hole.

Instead, the Unicorn and Giraffe each hold two stars, caught in a never-before-seen stage of stellar evolution, the researchers found after reanalyzing the data. Both systems contain an older red giant star with a puffy atmosphere and a “subgiant,” a star on its way to that late-life stage. The subgiants are near enough to their companion red giants that they are gravitationally stealing material from them. As these subgiants accumulate more mass, they spin faster, El-Badry says, which is what made them undetectable initially.

“Everyone was looking for really interesting black holes, but what they found is really interesting binaries,” Bodensteiner says.

These are not the only systems to trick astronomers recently. What was thought to be the nearest black hole to Earth also turned out to be pair of stars in a rarely seen stage of evolution (SN: 3/11/22).

“Of course, it’s disappointing that what we thought were black holes were actually not, but it’s part of the process,” Jayasinghe says. He and his colleagues are still looking for black holes, he says, but with a greater awareness of how pairs of interacting stars might trick them.