After Germany’s long economic dependence on industries subject to the Chinese regime, everything seems to indicate that its leaders will try to break with this apparently heavy and risky relationship inherited from former Chancellor Angela Merkel.
Given that the Chinese Communist Party (CCP) is accused of abuse in its international relations, many countries are planning to distance themselves, in view of the catastrophic results in certain cases.
The German Green Party, could use its dominance over the ministries of Foreign Affairs and the Economy to achieve objectives that would reduce its dependence on China.
So it was that Reinhard Bütikofer, chairman of the European Parliament’s delegation for relations with China and a member of the Green Party, referred to German Chancellor Olaf Scholz’s planned trip to China in November, saying, “I think he should be clear about the fundamental facts,” according to Politico October 10.
And he stated, “He [Scholz] should focus on making China understand that this transformation of the relationship is there for good, that there is no way of turning back to the Merkel years, and that Germany will shape a China strategy that will push back against China’s hegemonic ambitions.”
Although Germany’s trade with the Chinese industry is more important to its economy than its trade with other countries, the new direction he wants to give to this relationship will be significantly different.
Scholz himself seems to agree with the intentions expressed by the Green Party, given what he said in September at the U.N. General Assembly.
Scholz ratified on that occasion the unprecedented report denouncing human rights violations by the CCP in Xinjiang, presented by U.N. representative Michelle Bachelet.
“I think it was very right that there was an investigation,” Scholz stressed, adding, “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.”
He added that he thought “China should implement” the report’s recommendations. “This would be a sign of sovereignty and strength and a guarantee of change for the better.”
A complex mission for Germany?
Although Germany has mentioned several times in the past he CCP’s human rights abuses, its attitude was not sufficiently resolute.
Moreover, for decades it gave priority to business, putting the welfare of Chinese citizens in a secondary place. But now its concern has grown to the extent that it is under pressure to change the direction of that relationship.
Germany’s strategy on China analyst, Rafal Ulatowski, who is also a writer and adjunct professor at the Faculty of Political Science and International Studies at the University of Warsaw, spoke out.
Ulatowski, commented earlier this month, “Germany is worried about the unprecedented growth of Chinese power combined with the challenge China’s international strategy presents to the existing liberal international order.”
He added, “In other words, China’s desire to reshape the regional order concerns Berlin, particularly in the context of China’s efforts at military modernization,” specifying issues such as international clashes over Hong Kong, Taiwan and the South China Sea.
This strategy was reflected in practice in the refusal to join the Chinese regime’s Belt and Road project, and others, Ulatowski said, “Due to concerns over transparency, a level playing field for business and European labor, as well as environmental and social standards.”
In any case, it will be several years before the two countries’ economic ties are decoupled, and Germany is no longer so dependent on the Chinese supply chain.
But in the face of China’s new aggressive foreign policy, the German government would prefer to end its dependence on China. As for how to get rid of this dependence on China, the details have not yet been finalized.
CCP economy in decline
It is no secret that the Chinese regime’s economy is going from bad to worse. This is recorded in reports recently provided by entities such as the Asian Development Bank (ADB).
According to a September 21 release, the organization lowered its forecast for China’s growth to 3.3% from the 5.0% projected in April. Moreover, it cut its projection for next year to just 4.5%.
This trend may have influenced Germany’s decisions.
The decline in the economic growth of the great Eat Asian country is such that emerging Asia is now growing faster than China for the first time in 30 years, with Indonesia and the Philippines standing out.
For the ADB, developing Asia will grow by 4.3% in 2022, and the region is forecast to grow by 5.3%. Next year, the emerging Asia region is forecast to grow by 4.9%, excluding China.
However, risks remain, according to a statement from ADB chief economist Albert Park, who commented, “Developing Asia continues to recover, but risks loom.”
He added, “A significant slowdown in the global economy would severely undermine demand for the region’s exports.”
He also pointed out that more extreme global financial tightening could lead to “instability. And China is facing many challenges from the severe lockdowns and weak real estate sector.
Another indicator of China’s declining economy can be seen in its declining demand for liquefied natural gas (LNG), which could fall by 20% in the next quarter.
This news comes as a relief for Europeans, whose countries are going through an unprecedented crisis in recent years. Declining demand would make greater volumes of gas available for their own consumption.
Alex Shaw, chief Asia gas and LNG analyst at ICIS, noted, “This is great news for the market, as the excessive contract volumes mean that China is essentially adding spot, which is what Europe needs at the moment.”
A striking economic contrast
Certainly, the innumerable difficulties to which the great nation under the CCP is subjected are necessarily reflected in the economic crisis it has been going through for some years now.
This crisis has led to growing social instability, which logically affects everyone’s income, leading to increased cornered poverty.
On the other hand, it is worth noting the sharp contrast that results from comparing the faltering economy dependent on the policies of the Chinese regime with the successful results obtained by Taiwan which the CCP continues to attack.
The industriousness of the democratic Taiwanese and the wise guidance of their leaders led the country to rank first in Asia and fifth globally in net financial assets per capita, according to the Allianz Global Wealth Report 2022 released on October 12.
Taiwan thus adds another reason for the Chinese regime to be even more uncomfortable with the lessons of success it is receiving from the island it has vowed to annex, by force if necessary.
Although the CCP’s military might is far greater than Taiwan’s, many countries are willing to support Taiwan’s defense and help protect it. Such is the case with Germany, which, it seems, can no longer ignore the enormous risk of its supply chains being dependent on the Chinese regime.