During a meeting with Chinese Vice Premier He Lifeng in Frankfurt in early October 2023, German Finance Minister Christian Lindner emphasized the importance of developing economic ties between Berlin and Beijing and enhancing joint cooperation on some critical issues, particularly poverty alleviation and climate change.
Important Indicators
There is proof that Germany is pursuing a foreign policy aimed primarily at strengthening bilateral relations with China, which confirms the growing rapprochement in German-Chinese relations, the most prominent of which are:
1. Supporting Chinese policies:
Germany affirmed its support for China's position on the G20 debt restructuring framework for the poorest countries. This comes after the Chinese government responded to calls from some countries, including Germany, to speed up the process of restructuring Chinese debts owed to African and Asian countries that are unable to repay China, proving the effectiveness of China's role in global politics, particularly on the economic front. This stance reflects Germany's intention to retain existing relations with Beijing while expanding prospects for cooperation between them to exchange investments and commercial operations that contribute to maximize each other's economic gains.
2. Defending China's economic interests:
This was clearly demonstrated by Germany's rejection of the European Union's proposal to impose fees on electric cars imported from China, which represented approximately 43% of European countries' electric car resources in 2021. While China expressed concern about the European Union imposing moving customs duties on Chinese electric cars entering the European market, German Chancellor Olaf Scholz expressed his dissatisfaction with the European proposal and refused to rely on the Union's protectionist measures to protect the European automobile industry in the face of intense competition from cheaper Chinese cars. This is an important sign that Germany is taking more flexible positions, in contrast to the European Union and the United States, which are taking stricter foreign policies in dealing with issues in dispute with China in the context of protecting European and American interests and confronting China's dumping policies in European and American markets.
3. Mutual visits:
The visit of Chinese Prime Minister Li Qiang to Berlin in June 2023, and his meeting with German Chancellor Olaf Scholz, was one of the most significant. This visit was notable given that it was his first international tour since taking office in March 2023, further highlighting Beijing's high regard for Berlin. Prior to that, Scholz visited Beijing in November 2022, with the goal of improving vital commercial relations with China.
Convergence Motives
The rapid development in bilateral relations between Germany and China has sparked questions regarding Berlin's motivations for this growing rapprochement, particularly on the economic front. This can be explained by a number of objectives that Germany aims to attain, the most important of which are as follows:
1. Maximizing economic gains:
Germany recognizes the significance of establishing commercial relations with China, the world's second largest economic power, as China is Germany's major trading partner. Germany has also become China's fifth-largest commercial partner globally. The Chinese market is an outlet for German products, particularly those manufactured by German automakers (Volkswagen, BMW, Mercedes), whose sales volume in the Chinese market increased to around 40%. Volkswagen has also made a one-billion-euro investment in Anhui. In terms of Chinese investments in Germany, Chinese firms have successfully entered the German market, most notably BAIC and Li Shufo, who became partners in Mercedes and now possess 10% of the company's shares. On the other hand, BASF SE, the largest German petrochemical company, succeeded in pumping its investments into China (at the Verbund site in Zhanjiang, Guangdong Province, southern China) with a value of around 10 billion euros in 2030, with the goal of compensating for losses caused by high energy costs and strict environmental regulations in Europe. This is a key sign of Germany's desire to generate financial gains that help to the building of its national economy through greater economic ties with China.
2. Securing energy supply:
After the Ukrainian war disrupted Russian gas supplies to European countries as a result of Germany's rejection of Russia's invasion of Ukraine and implementation of sanctions on Moscow, China has become a significant source of energy for Germany. Berlin also relies on Chinese solar cells and "CATL" electric car batteries manufactured at two facilities outside of Germany, one of which is located in the country. As a result, China can help Germany meet its energy needs.
3. Diversifying partners:
The German-Chinese rapprochement reflects the current German government's foreign policy orientations, which aim to diversify international partners in order to achieve a degree of balance in relations with various countries around the world, particularly major powers such as Russia and China. Berlin believes that diversifying its overseas relationships allows it to expand economic interests prevent security concerns.
4. Strengthening Germany's international role:
At a time when political tensions between China, the US, and the European Union are rising, Germany and China are becoming closer partners. This is particularly so on the economic and political levels, as a result of Germany's efforts to serve as a mediator between China and the US on a number of controversial issues, mainly on human rights and Taiwan. Germany believes that these issues or crises represent a great chance to strengthen its international role by attempting to resolve them or, at the very least, preventing further escalation, whether between the parties to these crises or international parties led by the United States and China.
Existing Challenges
Despite the rapprochement in bilateral relations between Germany and China, there are a number of challenges that may have a negative effect on the current pattern of relations between the two nations, as detailed below:
1. Internal pressures:
German Chancellor Olaf Scholz is facing criticism from the political opposition within German society for what it describes as Germany's exaggerated reliance on Chinese energy imports, as well as the continuation of trade exchange operations with China, in a way that may lead to more German economic dependency on China, negatively affecting Berlin’s actions at the international level. Due to Scholz 's support of a foreign strategy oriented on shifting east towards China, these accusations extended to the ruling coalition within Germany. The coalition opposed Scholz's travel to China in November 2022, and the strength of these internal critiques intensified when the opposition criticized him for allowing the big Chinese shipping business Cosco to buy a share in Hamburg Port Container Terminal. Six ministries in the German government asked Scholz not to complete the deal, prompting him to allow the Chinese company to purchase a smaller share than agreed upon, in response to internal criticism in this regard. Thus, these criticisms represent mounting internal pressures that may have a significant negative impact on the German-Chinese rapprochement.
2. The new German strategy towards China:
In June 2023, Germany described China as a partner, but it is also a competitor. Germany's new strategy sees Beijing as a "systematic adversary,” with the country attempting to alter the international system based on certain rules and principles that align with its orientations and interests to achieve political goals. Germany also believes that Beijing's rapid economic rise would negatively affect the economic interests of European countries. China, on the other hand, criticized Germany's portrayal of it as an adversary. The Chinese Foreign Ministry issued a statement expressing its refusal to regard Beijing as an adversary or enemy, transforming their existing positive cooperation into competition and disagreement over political and security issues, ultimately leading to division and confrontation. This policy underscores Germany's concern of over-dependence on China, which would undermine German interests, while remaining committed to Beijing as Berlin's greatest trading partner. In this light, Germany recently announced a review of the investment law in order to limit Chinese investments in the country, after Berlin blocked China from attempting to dominate a new communications company for reasons of preserving national security.
3. Western American pressure:
Germany continues to improve its economic ties with China, in contrast to the foreign strategy that the European Union and the United States have both chosen towards China. At a time when economic collaboration between Berlin and Beijing is growing, Chinese-Western tension is rising as a result of China's support for Russia's invasion of Ukraine. In this context, Western countries and the US are putting pressure on Germany to disengage from China and not pursue a separate, independent foreign policy in its dealings with the country that conflicts with American foreign policy seeking to economically isolate China. However, Berlin has not responded to these efforts and continues to insist on developing a partnership relationship with China, which may cause tensions in West German and American relations.
The German commitment to building partnership relations with China indicates the continued disagreement and lack of unity with the European Union on international matters, which are marked by sensitivity in dealing with them. The European Union wants to deal with China through a unified and agreed-upon policy among all Union countries, whereas Germany is moving toward dealing individually outside the European Union framework, further increasing the latter's criticism of Berlin's recent approaches to China.
4. Ongoing controversial issues:
There are several controversial issues which may jeopardize German-Chinese relations, as follows:
- Stance on Taiwan: The stance on Taiwan is a deciding factor in the future of German-Chinese ties. German Education Minister Bettina Stark, a member of the Free Democratic Party, visited Taiwan in March 2023, sparking Chinese worries. The visit was the first of its sort by a German official in 26 years, which China regards as interference in its domestic affairs, prompting the cancellation of a visit to Beijing scheduled at the time for German Finance Minister Christian Lindner. This is an indicator of the potential impact of the Taiwan issue on relations with Germany, especially since Berlin's position is consistent with the American position in favor of Taiwan, which is one of the causes of tension in Sino-American relations.
- Human rights violations: Europe and the US accuse China of violating human rights and freedoms, particularly civil liberties and the rights of ethnic minorities in Xinjiang and Tibet. The allegations went so far as to have German Foreign Minister Annalena Baerbock describe Chinese President Xi Jinping as a dictator, prompting China to object to these comments and reaffirm its rejection of foreign involvement in its internal affairs. In this context, China accuses the US of attempting to distort its worldwide reputation in the guise of defending human rights. Despite this, Germany is eager to engage the Chinese government directly on human rights matters.
The current pattern of relations between Germany and China demonstrates the predominance of the economic element as an indicator of relations between the two countries. Despite political disputes between the two nations on a number of areas, current indicators point to Berlin continuing to retain commercial links with Beijing. It also rules out the possibility of tensions in German relations with the European Union and the United States, as Berlin pursues a balanced foreign policy that allows it to maximize economic gains with China while maintaining political, economic, and security ties with its European and Western neighbors.
