Germany and China China and Germany
Germany-China relations are regarded as an important strategic relationship. With the strong rise of China on the global economic map, the relations between the two countries have developed rapidly, but both sides are full of more caution and doubts about this relationship, especially considering the Due to the following factors: Berlin fears the danger of China penetrating its economy, thus seeks to reduce Beijing’s influence there, and finally adopts a special strategy to deal with China.
The British “Financial Times” recently published an analysis article stating that “Germany’s first China strategy reflects changes in the world”, indicating that China is Berlin’s largest trading partner and an important market for the industrial sector.
However, Berlin said it had decided to “de-risk” relations between the two countries, ignoring Chinese Foreign Minister Chen Jiang’s warning that not taking risks could mean “lost opportunities, disengagement, instability and lack of development”.
Berlin’s adoption of an “inclusive” policy demonstrates the importance it now places on diversifying its supply chains and export markets, thereby reducing its vulnerability to external shocks. The strategy is to identify weaknesses, make German companies more aware of the risks of doing business in China and make it clear that Berlin will not bail them out if they run into trouble. Germany is concerned about over-dependence on the Chinese industrial parts supply chain and the Chinese market itself.
Reduce risk, not disengage
Dr Naji Obaidi, an economist from Berlin, told Sky News Arabia that “Germany’s new regime has been under pressure following a split in tone between Chancellor Olaf Scholz and Foreign Minister Analina Berbock. The strategy aims to unify Germany’s political discourse on China.”
“The aim of the strategy is not to enter into new dependencies that Beijing could exploit to impose certain agendas,” he noted, noting that Germany’s mantra in this context is “reduce risk, but not disengage.” , ie, but without breaking with China. As Germany’s largest trading partner.
- Berlin said the 64-page strategy was in response to China’s increasingly “aggressive” approach and angered Beijing.
- The document, which discusses security policy as well as economic and technological cooperation, is the result of months of deliberation within the German government on its China strategy.
- The German Chancellor said in a tweet: “Our goal is not to break away from (China), but to reduce future economic dependence (…) This strategy is to deal with China, which has changed and is becoming more and more strict.” “
Concerns about widespread reliance on Beijing are growing in Germany given the current tensions between Beijing and the West, which are largely caused by Sino-Russian relations.
German economic research center IfW Kiel Center warned in a report last February of the need to diversify sources of supply related to commodities and raw materials away from China.
China’s positive move
Dr. Abdul-Masih Shami, an expert on international relations in Berlin, said in an exclusive interview with Arab Economic Sky News that the main reason behind Germany’s new strategy toward China is that Beijing has reduced trade with the largest economy in Europe, The Berlin War was largely fought after the Ukrainian War due to Germany’s tense stance.
- In the first four months of 2023, German exports to China will drop by 11.3% year-on-year.
- The decline has raised widespread concerns about the EU’s overall economic strength and the broader challenges facing the continent’s industrial powerhouse.
- Falling demand in Asia’s largest economy (China) also threatens to derail Berlin’s strategy to overcome the industrial challenges it faces.
The Financial Times published a report saying that “Germany’s drop in exports to China has shaken Europe’s largest economy,” citing economists as saying:
- German automakers are losing market share in China.
- Chemical producers and other energy-intensive businesses are being affected by high energy prices.
- The appreciation of the euro against the dollar makes German goods less competitive.
Shami believes that “Germany taking this step (a new strategy aimed at reducing dependence on Beijing) is an escalation in the wrong direction. Instead of trying to repair relations with Beijing and build on a new basis based on current data and circumstances.” relations.” In the new balance of power in the world, it (Germany) is dealing today with superior logic, carrot-and-stick policies, threats and intimidation, which negatively affects not only Germany but Europe as a whole.
He added, “Germany is basically going through an unprecedented crisis on different levels, and all these challenges it faces don’t bring it comfort and don’t give it a lot of room to abandon China as a major partner relations, especially after the defeat of Berlin to Germany.” Postwar Russia, it was a partner. “This is a very important strategy for Europe. Germany has lost this relationship with Russia, and today it wants to lose China, which will lead to an inevitable collapse of the German economy and influence. Due to the relationship with Russia and China relations, the economic and technological level that Europe enjoys, and the power that Europe enjoys.
Chinese Foreign Ministry spokesman Wang Wenbin commented on the above-mentioned German strategy: “We believe that competition and protectionism in the name of (reducing risk) and radically reducing dependence have given normal cooperation a political character.” Contrary to expectations and creating artificial risks.”
He explained that talking about “the so-called competition of regimes, interests, and values goes against the trend of the times and will only exacerbate the division of the world.”
Misunderstanding of the West
Shami explained the basic political background of Germany’s decision in this context, as follows:
- Germany’s strategy clearly reflects Europe’s misguided policy toward Beijing after the Ukraine war.
- The West still believes in its ability to pursue a “carrot and stick” policy towards China and therefore does not want to believe that the world has changed and Beijing will not accept this policy, especially since it is Europe’s most important trading partner.
- China has extended a hand of cooperation to Europe, always proposing the concept of partnership and integration, while Europeans want to take what they want and give what they want in a minimal and traditional way. This approach is unacceptable to China.
- Everyone knows that China is the factory of the world and the main source of many industries, raw materials and important resources. It is impossible to follow the superior logic of Europe, especially Germany.
In 2022, China will remain Germany’s largest trading partner for the seventh consecutive year. The trade volume between the two countries amounted to 297.9 billion euros ($318.9 billion), up 20 percent, according to the German Federal Statistical Office “Destatis”.
Germany’s trade deficit with China was 84.3 billion euros (the highest since the agency began keeping records in 1950). In 2022, imports from China will increase to 191.1 billion euros, an increase of 33% over the previous year. In contrast, German exports amounted to 106.8 billion euros (only 3% more than in 2021).
Contrary to Germany, many European countries have emerged. According to Eurostat data, in the first quarter of this year, exports to China from the 27 EU member states increased by 2.9% year-on-year.
In the first three months of this year, China accounted for just 6% of Germany’s total exports (the lowest share since 2016). This contradicts previous expectations that Germany’s huge manufacturing sector will benefit from increased demand from China after the “zero crown” policy is lifted.
prudent strategic relationship
Mohamed Khafaji, a journalist and writer from Berlin, told the “Sky News Arab Economy” website that Germany and China have a long-term strategic relationship. For more than 20 years, this relationship has begun to show an evolving curve. From China’s revival to The strategic partnership between Germany and China. It has become clear to the world that the Germans have long felt the threat to the German economy from a Chinese renaissance, and have invested in China’s growth since the turn of the century in order to gain a foothold in the global economy.
He went on to say: “Germany did not lead Germany to a conflict with China, but deliberately cooperated with China, concluded an economic partnership, and then many industries were developed in Germany and then exported to China, and vice versa, just like China. It is the same as a broad country. The market in many areas of the German economy is in a leading position. For example, 40% of German car sales are in China. China is also trying to obtain many technologies from Germany, including certain technologies for mobile phones, but Germany does not allow many things , because it wants to be a limited partnership to a certain extent”.
Given the development of relations between the two countries and Germany’s heavy reliance on relations with China, many German experts have warned that such a partnership could harm China while benefiting the German economy, Kafaji noted, saying that the past year , Germany’s imports from China have increased relative to Germany’s exports, which shows that China’s hegemony in the German market is increasing, so Germany seeks an appropriate way to stand in front of the wheels of China, which is spinning at a high speed in Berlin, And start to control some economic aspects.
Therefore, “the partnership between the two countries is an economic partnership full of prudence, suspicion and suspicion”, and in the eyes of journalists specializing in German affairs, this prudence is also Chinese, because it turned out that the Germans did not allow Beijing acquires some companies and acquires certain types of technology that Germany considers strategic.
Politico: Europe divided over trade relationship with Beijing