When it seemed that the new German chancellor would curb relations with the Chinese communist regime, the German government approved a controversial agreement. Germany will hand over an important share of a port terminal in Hamburg, in what seems to be an attempt to maintain the relations developed under the administration of former Chancellor Angela Merkel.

The left-wing coalition led by Chancellor Olaf Scholz confirmed the sale of a 24.9 percent stake in the Hamburg shipping container terminal, Europe’s second largest, to China’s state-owned COSCO Shipping.

The deal originally was for a 35 percent stake, but opposition was so loud that it eventually settled at almost a quarter of the total stake, which is still a huge.

Proponents of the deal argued that it will be beneficial for Germany, which will gain a competitive advantage in handling Chinese trade.

Other sectors, and both sides in the government have shown dismay and concern about the agreement. So much so that, according to media reports, a fierce dispute has broken out between German Chancellor Olaf Scholz and several government ministries.

A briefing note produced by the German Foreign Ministry also took aim at the agreement, warning that it “disproportionately expands China’s strategic influence on German and European transportation infrastructure, as well as Germany’s dependence on China.”

The warning also refers to some of the terms of the agreement. In the event of an “emergency” the Chinese regime would be allowed to take over part of the port, which poses a direct threat to both Germany and the rest of the EU.

Continuing the critical line, Europe’s Minister of State Anna Lührmann warned, “On behalf of the Federal Foreign Office, I expressly point out the considerable risks that arise when elements of the European transport infrastructure are influenced and controlled by China, while China itself does not allow Germany to participate in Chinese ports.”

The relationship that Scholz would develop with the communist regime was an unknown but now seems to be becoming clear. 

In addition, Scholz announced his visit to China in early November, which will make him the first Western leader to visit China after the Wuhan coronavirus pandemic, seeking to further deepen bilateral relations.

Scholz is also likely to be the first Western leader to meet with Chinese leader Xi Jinping after the mid-October Communist Party congress, when he secured a third term as general secretary of the CCP.

Scholz’s trip is coming just as the chancellor walks a fine line between continuing the close economic relationship with the CCP Merkel and, at the same time, taking a more critical stance on issues such as human rights.

Scholz’s recent decision to get closer to the Chinese regime has surprised many, in fact just a couple of weeks ago he gave a speech at the United Nations General Assembly, in which he highlighted the denunciations carried out by the former head of Human Rights of the organization, Michelle Bachelet, regarding the serious human rights violations perpetrated by the Chinese communist regime against the Uyghur minority.

Sholz said, “I think it was very right that there was an investigation.” He added, “Mrs. Bachelet did a very good job, but it was also necessary. From my point of view, it is important to stay on the case.”

Chinese regime was Germany’s largest trading partner during Merkel era

During Merkel’s tenure, Germany deepened economic ties with the Chinese regime as never before, which resulted in China becoming Germany’s top trading partner since 2018.

So much so that major German companies including BMW, Volkswagen, and Hugo Boss, have been accused of benefiting from the use of forced labor in China’s Xinjiang region, where millions of Uyghur and other ethnic minority Muslims are being locked up in forced labor camps. 

After the pandemic broke out, the Chinese communist regime became much more exposed to the critical eye of the whole world and maintaining a close business relationship with communism in many countries started to be seen as not so good, or rather downright bad. 

Many European and even German officials have expressed concern about the European power’s dependence on the Chinese regime. U.S. officials and politicians have also criticized this close relationship.

Scholz had everything in his favor to break this dependence, and at one point it even looked as if he was going to do so. But no, recent events seem to demonstrate that Germany, far from trying to put brakes on the Chinese regime, as other countries are doing, is benefiting with agreements that may even put its own security and sovereignty at risk.

On top of this, Germany is not having a good time; in September it recorded the most drastic monthly wholesale inflation since World War II. The Price Index registered a 10% increase.

In addition, its economy went into recession and at the same time the effects of the war between Russia and Ukraine began to be felt, which deeply affected the German energy system that depended to a great extent on Russian supplies.

Cornered by this economic reality, the current minister seems to be deciding once again on a more harmonious relationship with the CCP.

How will the rest of the European countries react? What about the United States? Will there be more agreements between Germany and the CCP after Scholz’s visit to Beijing?

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