Germany aims to “reduce critical dependences” on its main trading partner, according to Chancellor Olaf Scholz.
After months of contentious discussion on how to handle Berlin’s main trading partner, China, Chancellor Olaf Scholz said that Germany has released a new strategy to deal with a more “assertive” China.
Our goal is not to break ties with Beijing. After announcing the new approach on Thursday, Scholz tweeted that it was “a response to a China that has changed and become more assertive.” However, going forward, we aim to eliminate crucial dependence.
Foreign Minister Annalena Baerbock said that the goal of the strategy was to be “realistic but not naive” and that it would be a part of the European Union’s approach to China.
The German government’s approach toward China has been the subject of months of internal debate, which led to the creation of the paper.
Scholz, a Social Democrat, has supported a more pro-trade approach, while Baerbock, of the Greens party, has advocated for a more aggressive posture against Beijing and a stronger focus on human rights.
Beijing is referred to as a “partner, competitor, and systemic rival” in the coalition government’s new China strategy, which represents a well balanced effort between the two.
China is Germany’s greatest commercial partner, but the study said that although Germany’s dependence on China has grown recently, China’s dependence on Europe has been steadily diminishing.
The administration said that their intention was not to “hinder China’s economic progress and development.”
De-risking is critically required at the same time, it said.
Order on a global scale
Berlin “is watching with concern how China is attempting to shape the international order in accordance with the interests of its single-party system and thereby relativize the tenets of the rules-based international order, such as the status of human rights.”
Germany accused China of working against German interests, placing international security “under increasing pressure,” and disrespecting human rights in its first national security plan, which was published last month.
The “biggest threat in relation to economic and scientific espionage and foreign direct investments in Germany” according to a study by Germany’s intelligence agency was China.
The tougher stance has frightened Beijing but also caused concern in Germany’s heavily reliant German industry.
Corporate behemoths like Volkswagen and Siemens have recently revealed expansion plans that mainly depend on the Chinese market.
Ralf Brandstaetter, chief operating officer of Volkswagen, praised the new China strategy’s political objective of “strengthening our own position, reducing one-sided economic dependencies, and creating incentives for more diversification” on Thursday.
The head of China for the German automobile manufacturer stated in a statement, “We don’t look naively at the economic behemoth China has become.
Germany must “create autonomously controllable value chains” and “reduce dependencies as well as strengthen our position in other regions” to avoid geopolitical risks, he said.
‘De-risking’
Germany “wants de-risking, not decoupling,” according to Scholz.
He did, however, highlight Berlin’s initiative to widen its trade partners, stating that Germany is “committed to actively broadening our economic relations with Asia and beyond.”
After the United States stepped up its economic sanctions on China, Beijing is concerned that its main trading partner in the EU may follow suit. As a result, Beijing is using the apparently innocuous term “de-risking” to gradually distance itself from the Asian economy.
Li Qiang, who made his first overseas trip since being appointed China’s prime minister last month and visited Germany, emphasized the importance Beijing placed on strengthening ties with the EU as criticism from the group becomes more vocal.
He urged Berlin to avoid “using de-risking in name to carry out decoupling” and demanded a “level playing field” for Chinese businesses.
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