What experts make of Germany's first 'China strategy'

J.D. Capelouto
·2 min read
5

The News

Germany released its first “China strategy” on Thursday, as the EU’s largest economy seeks to grapple with an increased reliance on an increasingly aggressive China.

The 64-page document made clear that Germany sees China as a rival, and wants companies to ”de-risk" and be less dependent on Beijing. But it’s not advocating for a full “de-coupling” from China, and it still described China as a partner, especially on issues like climate change and global health.

We’ve curated insights and analysis on what experts make of the document.

Insights

  • Berlin plans to more closely scrutinize Chinese investments in Germany, and vice versa, and will “seek to increase incentives for companies to diversify away from China,” The Wall Street Journal reported, noting that it’s a “new approach” for Germany but not a total U-turn. “It’s clear that the government didn’t want to burden companies with additional requirements,” Noah Barkin, an expert on Europe and China at Rhodium Group, told the Journal. “We will see if companies that are heavily dependent on China will react.”

  • German business associations are largely pleased with the new strategy, with the president of one trade association calling it ”long overdue,” Der Spiegel reported. The head of the German Institute for Economic Research said the report was clever, but too vague at times when it comes to how the goals will be achieved. Germany is so dependent on China, he said, that a swift reduction in reliance seems unrealistic.

  • The strategy “made clear that Germany won’t be deterred from doing business with self-governed Taiwan,” and believes military escalation in the Taiwan Strait would pose a risk to its interests, the AP reported. But the report noted: “We only have diplomatic relations with the People’s Republic of China.”