{"id":917,"date":"2021-10-27T20:42:02","date_gmt":"2021-10-27T17:42:02","guid":{"rendered":"https:\/\/dukva.org\/en\/?p=917"},"modified":"2021-10-27T20:42:03","modified_gmt":"2021-10-27T17:42:03","slug":"germany-inc-s-china-syndrome","status":"publish","type":"post","link":"https:\/\/dukva.org\/en\/germany-inc-s-china-syndrome\/","title":{"rendered":"GERMANY INC.\u2019S CHINA SYNDROME"},"content":{"rendered":"\n

Politco<\/a>. 26 October 2021<\/strong><\/p>\n\n\n\n

\"\"<\/figure><\/div>\n\n\n\n

Below is an article published by Politco<\/a>. Photo: Getty Images.<\/em><\/p>\n\n\n\n

For decades, German industry \u2014 an early mover in the Chinese market \u2014\u00a0looked the other way\u00a0amid Beijing\u2019s human rights abuses, as managers and engineers from the likes of Siemens and Volkswagen helped transform the country into Germany\u2019s largest trading partner. But as Chinese leader Xi Jinping tightens the country\u2019s surveillance state, threatens neighbors and takes on an increasingly belligerent tone with the West, Germany\u2019s China strategy, shaped to serve the needs of its export industry, is looking increasingly unsustainable.<\/p>\n\n\n\n\n\n\n\n

So much so, in fact, that leading German industry players are joining prominent politicians in calling for a rethink of the country\u2019s approach to China and other autocratic states.about:blank<\/p>\n\n\n\n

\u201cHuman rights are not the internal affairs of states,\u201d said Siegfried Russwurm, the head of the Federation of German Industries (BDI), adding that companies have \u201cthe obligation to define red lines for their global commitment themselves,\u201d instead of waiting on their own governments to do so.<\/p>\n\n\n\n

If Russwurm sounds more like an activist for Amnesty International than the head of German business\u2019 main lobbying arm, that\u2019s because Germany Inc. is more worried than ever about the optics and on-the-ground realities of doing business in China and other autocratic states. Like many foreign investors in China, German companies were long convinced that they would eventually be on a level playing field with their local counterparts. But Xi, who has put foreign firms on a tighter leash, has convinced them otherwise.<\/p>\n\n\n\n

Now, German business, which is more exposed to China than any of its European peers, faces an impossible choice between preserving a crucial trade relationship and observing the liberal ideals Germany holds dear. <\/p>\n\n\n\n

Asked how trade could be upheld amid reports of human rights abuses in China, a spokesman for Siemens said in an emailed statement that the conglomerate \u201ccategorically rejects all forms of oppression and participation in human rights violations,\u201d adding that they \u201cput trust in the U.S., China and Europe to find political solutions based on \u2026 reliable and transparent rules of cooperation as well as on an open dialog.\u201d<\/p>\n\n\n\n

In an effort to help firms square that circle, the BDI recently published a paper titled \u201cResponsible Coexistence with Autocracies.\u201d Even as the paper underscores the importance for Western firms to \u201clead by example\u201d on questions of human rights and environmental protection, it also makes clear that severing commercial ties with difficult regimes isn\u2019t a viable option.<\/p>\n\n\n\n

\u201cIt is a fact that companies must generate profits in order to retain long-term competitiveness,\u201d the paper concludes. \u201cWe cannot defend democratic values any better if we weaken ourselves economically.\u201d<\/p>\n\n\n\n

Nonetheless, it\u2019s a difficult case to make in the face of Beijing\u2019s suppression of the Uyghurs, its crushing of Hong Kong\u2019s democracy movement, and its belligerent stance toward longtime partners like Australia.<\/p>\n\n\n\n

VW, the world\u2019s largest carmaker, came under scrutiny this year over running a factory in Xinjiang \u2014 the region where extensive inhumane treatment has been documented against China\u2019s Muslim Uyghur minority. Some countries, including the U.S. have labeled China\u2019s actions a genocide.<\/p>\n\n\n\n

But Herbert Diess, the CEO of VW, defended his company\u2019s engagement in the region, arguing that it upholds its \u201cvalues in Xinjiang, including employee representation, respect for minorities, and social and labor standards.\u201d<\/p>\n\n\n\n

Once seen as the key to Germany\u2019s long-term prosperity, China is now viewed in Berlin as a long-term problem.<\/p>\n\n\n\n

Something\u2019s different<\/h3>\n\n\n\n

Not even China\u2019s biggest defenders in Germany are pretending any longer that economic prosperity will turn Asia\u2019s juggernaut into a Western-style democracy, an idea known as \u201ctransformation through trade\u201d that has been propagated by German executives and politicians since the Cold War. <\/p>\n\n\n\n

\u201cThe sober assessment is that \u2018transformation through trade\u2019 has reached its limits,\u201d the BDI concluded. \u201cThe expectation that global economic interdependence would automatically facilitate the spread and development of market economies and democratic structures has not come to pass.\u201d<\/p>\n\n\n\n

That reality check has left German business in a bind, and not just concerning China. One in four German jobs depends on exports and despite persistent pressure from its partners, Germany has run one of the world\u2019s largest trade surpluses for decades. Much of that trade is with autocratic states like China and Russia.<\/p>\n\n\n\n

While Germany has always traded with unsavory regimes, it has never relied on one to the degree it now relies on China. Though the U.S. is still Germany\u2019s largest export market overall, China has driven much of the growth for demand in German machinery and autos in recent decades and has been Germany\u2019s largest trading partner (combined exports and imports) for five years running. <\/p>\n\n\n\n

The question is how sustainable those trends are. It\u2019s begun to dawn on many German industrialists that China, which has relied on their engineering acumen to modernize its economy, might not need them anymore. Over time, China has become quite good at designing and building the specialized machinery, tools and other equipment it used to need Germany for.<\/p>\n\n\n\n

German industry\u2019s China debate comes as the country\u2019s political winds are shifting. Both the Greens and the liberal Free Democrats, the two parties expected to join the Social Democrats in forming a new government, take a considerably harder line on China than did outgoing Chancellor Angela Merkel.<\/p>\n\n\n\n

Merkel has been criticized for years as being too soft on China. In the midst of last year\u2019s democracy protests in Hong Kong, Merkel flew to China with a large trade delegation and met with Xi. She also was the driving force behind the EU\u2019s investment agreement with China. The deal, signed last December, met with strong resistance in Washington, where a bipartisan consensus has formed in recent years that the West needs to take a more forceful position toward China.<\/p>\n\n\n\n

\u201cThose who expect Europe to be neutral in the standoff between China and the U.S. are missing the reality,\u201d said Bijan Djir-Sarai, the foreign policy spokesperson for the Free Democrats in the German parliament. \u201cOf course, we also fight for European interests, but our place is in a close partnership with the U.S. and we should not be under any illusion.\u201d<\/p>\n\n\n\n

Among the BDI\u2019s guidelines for new European foreign economic policy, for example, there is a call for a stronger euro relative to other currencies, arguing this \u201cwould provide Europe with more weight in the international payments system and global financial markets.\u201d<\/p>\n\n\n\n

Nils Schmid, the SPD\u2019s foreign policy spokesman in the German parliament, argued Germany needs to push harder within the EU for a common stance on China \u2014 one that isn\u2019t necessarily in opposition to the U.S.\u2019s but that puts European interests first. <\/p>\n\n\n\n

Germany\u2019s incoming government needs to \u201cstrengthen the foundations for the ability to act \u2014 on the national as well as the European level,\u201d he said. \u201cThen there will be no need to declare a new Cold War with China.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

Politco. 26 October 2021 Below is an article published by Politco. Photo: Getty Images. For decades, German industry \u2014 an early mover in the Chinese market \u2014\u00a0looked the other way\u00a0amid Beijing\u2019s human rights abuses, as managers and engineers from the likes of<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"footnotes":""},"categories":[35],"tags":[],"_links":{"self":[{"href":"https:\/\/dukva.org\/en\/wp-json\/wp\/v2\/posts\/917"}],"collection":[{"href":"https:\/\/dukva.org\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dukva.org\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dukva.org\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/dukva.org\/en\/wp-json\/wp\/v2\/comments?post=917"}],"version-history":[{"count":1,"href":"https:\/\/dukva.org\/en\/wp-json\/wp\/v2\/posts\/917\/revisions"}],"predecessor-version":[{"id":918,"href":"https:\/\/dukva.org\/en\/wp-json\/wp\/v2\/posts\/917\/revisions\/918"}],"wp:attachment":[{"href":"https:\/\/dukva.org\/en\/wp-json\/wp\/v2\/media?parent=917"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dukva.org\/en\/wp-json\/wp\/v2\/categories?post=917"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dukva.org\/en\/wp-json\/wp\/v2\/tags?post=917"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}