China and Germany agreed to expand mutual market access based on a level playing field and strengthen cooperation in the fiscal and financial areas. Chinese Vice Premier He Lifeng and German Minister of Finance Christian Lindner co-chaired the third China-Germany High-Level Financial Dialogue in Frankfurt and reached consensus on 25 topics, China’s Ministry of Finance said in a joint statement. Both sides agreed to communicate on signing a memorandum of understanding (MOU) on insurance supervision, and China welcomes qualified German insurance companies to apply for operational licenses in areas they specialize in. Chinese and German authorities will discuss exempting specific requirements for Chinese banks’ branches in Germany, while China is willing to encourage at least one Chinese bank to establish a subsidiary in Germany as its European hub. Both sides will support German financial institutions conducting renminbi business, encourage qualified German entities to issue and invest in renminbi-denominated bonds and promote the listings of depository receipts of domestic shares on each other’s stock markets. Both countries will also cooperate on central bank digital currencies and sustainable finance. During the last financial dialogue in 2019, central banks from both sides signed a memorandum of understanding to strengthen cooperation, the China Daily reports.
The South China Morning Post adds that the Lindner-He talks were the first of their kind in four years. The talks came at a time when the two countries are struggling to manage the risk of economic downturn and follows the publication of a German plan to “de-risk” its relationship with China by reducing its reliance on goods produced in the country. At a National Day event in Berlin to mark the 74th anniversary of the founding of the People’s Republic, Ambassador Wu Ken said China was willing to deepen cooperation with Europe and Germany on the basis of mutual benefit. “We hope Europe will show more openness and self-confidence on the issue of electric vehicles and Huawei’s 5G technology,” Wu said. He was responding to reports that Germany’s Interior Ministry is planning to force local telecoms operators to rid their networks of Chinese-supplied critical components by 2026, including parts supplied by Huawei Technologies and ZTE Corporation. In their last round of talks in January 2019, both sides signed agreements to strengthen coordination in banking, finance and capital markets, and pledged to further open market access and deepen cooperation in a bid to broaden economic ties.
Ambassador Wu said China understood German’s concerns and fears but the “fear of change and competition should not lead us to stray from the path of cooperation or to put up barriers”. “In the face of a century of changes and the ‘turn of the times’, as well as increasing global challenges, awareness of worries and risks is necessary and beneficial. I hope that the German government and society can continue to view students and scholars from China with an open mind rather than with suspicion or even vigilance,” Wu said, calling on both sides to renew efforts to improve ties and understanding. “We need to sow more seeds of friendship in the hearts of the young generations of the two countries. They are not risks, but the future of the two countries, as well as builders of bilateral ties,” the Ambassador said.
But there were also signs of tension. German envoy for international climate action Jennifer Morgan was given the cold shoulder on trip to Beijing as she was granted just one meeting with a government official, China’s climate envoy Xie Zhenhua, during her three-day visit to Beijing. She was told senior officials were too busy to meet her, which was regarded as a sign of displeasure over Foreign Minister Annalena Baerbock’s calling President Xi Jinping a “dictator”. The German Ambassador Patricia Flor was called to the Foreign Ministry for a dressing down, while Ministry Spokeswoman Mao Ning described the remarks as “extremely absurd, seriously infringing on China’s political dignity and an open political provocation”. Morgan’s requests to meet officials from several Chinese ministries were rebuffed. Morgan is seen as close to Baerbock, who plucked her from her role as head of Greenpeace to lead Germany’s climate policy last year, a move that required Morgan, an American, to take on German citizenship.
