China oppresses the Uyghurs, supports Russia in the Ukraine war. Now Berlin wants to readjust its relations with Beijing. Problem: The system rival is the most important economic partner.
China's treatment of the Uyghurs provokes protests worldwide
They are shocking documents from China's far northwest, from the Uyghur province of Xinjiang: photos show heavily guarded internment camps, torture chairs, guards with clubs, prisoners humiliated; Minutes of orders from senior party officials ordering guards to shoot at fugitives. Refugees who, according to Beijing, should be students in vocational training centers and not prisoners.
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Police photos from “re-education camps”
The “Xinjiang Police Files”, which are authentic according to investigations by an international research team, show the brutality with which the predominantly Muslim Uyghur minority in China is oppressed. Your publication comes at a time when there is much talk of a value-oriented foreign policy. And indeed, the leaked documents have given the rethinking of German politics with regard to China a further boost. After the energy partnership with Russia a second mainstay of the German economic model of the past decades is now being called into question with the relationship with China – across almost all political camps.
The human rights commissioner of the federal government, Luise Amtsberg, called for a different China policy. An open debate is needed about the economic dependencies of states that have such a frightening human rights record, said the Greens politician to the editorial network Germany. The CDU politician Michael Brand, chairman of the working group on human rights and humanitarian aid in the Bundestag, demanded on Deutschlandfunk that just as one becomes less dependent on Russian energy, one must also become less dependent on economic relations with China.
Proximity and distance
On the government side, Chancellor Olaf Scholz expressed his concern at the World Economic Forum in Davos about China's growing claim to power. Of course, the People's Republic is a “global player,” said the Chancellor. But just as there is no need to isolate China, “the claim of Chinese hegemony in Asia and beyond cannot be derived from this. Just as little can we turn a blind eye when human rights are violated, as we are seeing in Xinjiang right now,” said Scholz.
Chancellor Scholz in Davos: “Deglobalization is a dead end”
On Wednesday, Vice Chancellor and Economics Minister Robert Habeck pleaded for greater distance from China. The People's Republic is a major trading partner, said Habeck, but there are “very relevant problems”, including in respect of human rights. “That was hidden for years. But this government has changed the way it deals with China issues,” emphasized the Green politician. “We are diversifying more and are also reducing our dependency on China. The protection of human rights is more important,” announced the Economics Minister.
For a quarter of a century, relations between Germany and China were primarily one thing: economic relations. It worked so well that in 2021 China was Germany's most important trading partner for the sixth year in a row. The flourishing business was politically secured through intensive bilateral exchange.
China and Germany officially maintain a “comprehensive strategic partnership”; both sides meet every two years for intergovernmental consultations, which are always attended by the majority of cabinet ministers as well as the heads of government. The traffic light government also wanted to stick to this legacy of Merkel's policy. The coalition agreement notes on page 124: “We want to continue the government consultations”; unlike in the past, however, they are to be designed “more European”.
When economic relations were still largely undisturbed were: German-Chinese government consultations in Berlin in 2018
Partner, competitor, system rival
However, the German-Chinese partnership has been showing clear cracks for some time. The relationships between Germany and Europe on the one hand and China on the other are now consistently described as a triad of partnership, competition and system rivalry. More recently, however, the weight has shifted significantly further in the direction of rivalry. The coalition agreement takes this into account: “In order to be able to realize our values and interests in the systemic rivalry with China, we need a comprehensive China strategy in Germany as part of the joint EU-China policy,” it says strategy is currently being developed at the Federal Foreign Office. Details are also on not to be found out by asking.
It can be assumed that China's attitude towards Russia in the Ukraine war will have a significant influence on this strategy. Mikko Huotari, director of the influential Berlin China think tank Merics, wrote in the journal “Internationale Politik” at the beginning of May that China's commitment should in future be calibrated to the “extent of Beijing's support for Putin”. Merics boss Huotari also wants a “strategic economic foreign policy”. The overarching priority: “Reducing those dependencies on China that could limit Germany's strategic ability to act in the event of a crisis”.
Energy transition – with China?
As painful and expensive as it was to wake up from the energy dependency on Russia, the economic ties with China are many times closer and more intense. The decoupling of the German economic model from China is likely to be much more difficult than saying goodbye to cheap energy from Russia. At the same time, there are conflicting goals, for example with the energy transition. Far more photovoltaic systems are to generate electricity on Germany's roofs in the future as a substitute for fossil fuels. An essential raw material for the solar modules is polysilicon. However, 40 percent of world production comes from China – from the north-west province of Xinjiang, home of the oppressed Uyghurs.
< p>Energy transition – with Chinese products. Not only many solar modules, but also important primary products come from China
Wolfgang Niedermark, the managing director responsible for Asia at the Federation of German Industries, BDI, confirmed to DW: “Especially in the area of mineral raw materials, there is a very high and strategically extremely important dependency on China.” In a written statement, the China expert demands: “We must bring these input dependencies under control quickly and invest in new partnerships.”
Distrust of dictatorships is also growing at the BDI: “We are learning from the Russia-Ukraine war and the current revelations from China that there are no guarantees when dealing with autocracies,” writes Niedermark. However, the following also applies: “We want to continue to cooperate economically – even with countries that are not liberal democracies. This is the only way for the EU to be an internationally relevant and strong player. But you must not become dependent.”
Who is dependent on whom?
In fact, China is more dependent on the European market than Europe is on the Chinese. That's what Jörg Wuttke says. As President of the European Chamber of Commerce in China, he knows the facts and figures. “We export goods worth 600 million euros to China every day; the Chinese export 1.3 billion euros to Europe every day,” Wuttke told DW. And then to qualify: “Of course, it’s different when it comes to investments. The big companies in the automotive industry, in the chemical industry, in mechanical engineering are very well positioned and generate business in China for China, on the Chinese market. Very few of us export. “
According to figures from the Ministry of Economic Affairs, the stock of German direct investments in China had totaled 86 billion euros by 2018. So much commitment complicates the desired decoupling: “Should we close our factories?” asks Wuttke.
In Beijing for decades: Jörg Wuttke, President of the European Chamber of Commerce in China
Investments in China have been extremely profitable over the past year. “That profitability has supported our share prices at home and also created our jobs.” Wuttke speaks of millions of jobs in Germany that depend on investments in China. He lists “engineering services, preliminary products, engine parts” as examples.
Decoupling on all sides
The mood is changing not only in the West. “Decoupling” is also Chinese policy. Especially since Chinese tech companies have had to do without important chips due to US trade sanctions. With the 14th five-year plan adopted in March 2021, China is setting a clear course to “reduce its own dependence on the rest of the world and ultimately achieve a high degree of independence,” writes the European Chamber of Commerce in China in a position paper. The globalized world, it seems, is breaking apart more and more. It will be interesting to see what answers the German government's China strategy finds.