German Chancellor Olaf Scholz traveled to Beijing for an 11-hour visit, meeting the Chinese President and Premier and strengthening economic ties. It was the first visit of a Western leader since the start of the Covid pandemic in December 2019. A delegation with representatives from the largest German companies, including Volkswagen, BASF, Bayer, and BMW, accompanied Scholz.
Premier Li Keqiang said that China is ready to strengthen cooperation with Germany in priority areas such as trade, investment, manufacturing and vaccines. He said that China and Germany are both major economies and the two countries have constantly advanced their pragmatic cooperation to new levels as bilateral exchanges keep growing.
Noting that two-way opening-up and mutual benefit are distinct characteristics of China-Germany pragmatic cooperation, he said trade and economic cooperation represent the cornerstone of bilateral relations. Premier Li also promised to push for more direct flights between the two countries so as to facilitate people-to-people exchanges. He reiterated China’s commitment to the policy of reform and opening-up, and the pursuit of mutual benefit and win-win results.
China’s door will only open up wider, Li added. Chancellor Scholz said his country does not propose to have any decoupling and it hopes to secure world peace and development, and global economic growth with equal market access. Germany stands ready to work with China to overcome the impact of the Covid-19 pandemic and deepen cooperation on the basis of equality and mutual benefit, he said.
Jochum Haakma, Chairman of the EU-China Business Association (EUCBA), was quoted in the China Daily saying that the timing of Scholz’s visit is “very opportune and timely”, since Germany is China’s biggest European investment and trading partner. “There is a great interdependency between Europe and China, and Germany is one of the biggest players on the European side. Open talks between both leaderships on the highest level to share different perceptions but to strive for reaching common goals could be very meaningful and could alleviate the pressure which was building up over time by sheer isolation,” he said, referring to travel disruptions over the past three years caused by the Covid-19 pandemic. “There lies a huge responsibility on the shoulders of both world powers to act right and not wrong,” he said.
Two-way trade between the two countries in the first nine months of this year reached USD173.6 billion. More than 5,000 German enterprises are investing and growing in China, and more than 2,000 Chinese companies are operating in Germany. China Aviation Supplies Holding said it signed orders to buy 140 planes worth about USD17 billion from European aircraft maker Airbus. The purchase agreement includes 132 A320 series aircraft and eight A350 planes.
Martin Wansleben, Managing Director of the Association of German Chambers of Commerce and Industry, said that it is right for Chancellor Scholz to make the visit, as Germany, Europe and the world are dependent on China in many ways as well as in solving emerging problems, including climate change and food security. “Without China, we can never really solve these problems,” he said. A German government's spokesperson said that Berlin was against “decoupling” from the Chinese economy and wanted Beijing to show reciprocity in trade relations. Cui Hongjian, Director of the Department of European Studies at the China Institute of International Studies, told the Global Times the business community remains a strong pillar pushing forward China-Germany cooperation because of the great and stable benefits from such cooperation.
China has been Germany's biggest trading partner for the past six years, with value exceeding €245.3 billion in 2021, accounting for 30% of the total trade between China and the EU. The visit is widely acknowledged as an opportunity for face-to-face communication, which is crucial for the two countries to exchange views, manage differences and consolidate common ground, Cui said. China-Germany relations have been transformed from “casting aside differences and seeking common ground” in the past to a new pattern of shared economic interests along with increasing political rifts, Zhao Junjie, Research Fellow at the Chinese Academy of Social Sciences' Institute of European Studies, told the Global Times. Scholz also faces mounting pressure from other EU member states to take a tougher stance over China ties against the backdrop of escalating geopolitical confrontations, observers said.
“It needs to be pointed out that China's fundamental policy of attracting foreign investment to promote cooperation has not changed and the country is always against “decoupling.” This is because China's economic development has the need for continuous opening-up and more foreign investment as part of its growth momentum. Meanwhile, in the face of the U.S.' containment strategy, it is also important for China to break the U.S.-led “decoupling” push with an open spirit. Broader opening-up and cooperation with the rest of the world will prove that the U.S. strategy won't work. Sound and stable economic and trade cooperation is based on reciprocity. Therefore, the Chinese market will favor those who are willing to pursue pragmatic cooperation, rather than those who want to “decouple” from China, while profiting from the Chinese market.”, the Global Times commented ahead of Scholz's visit.
Bilateral trade between China and Germany rose 0.9% on a yearly basis to USD173.57 billion in the first nine months of this year. The BASF Zhanjiang Verbund site, the first wholly foreign-funded project in China’s heavy chemical industry, was put into operation in September. Investment is expected to increase to €10 billion by 2030. BASF’s sales in China in the first three quarters rose 5.8% from a year earlier to €9.2 billion.
This overview is based on reports by the China Daily, Shanghai Daily, Global Times and South China Morning Post.
