Germany and China: New diplomatic dialogue on the horizon!

Germany and China: New diplomatic dialogue on the horizon!

German-Chinese relations have become more intense in recent weeks, despite the challenges at the diplomatic level. Foreign Minister Johann Wadephul (CDU) had a constructive telephone conversation with his Chinese colleague Wang Yi after his trip to China had to be postponed. During the conversation, both sides emphasized the need for stable relations between the two nations. Wadephul plans to reschedule his visit soon to further strengthen the dialogue. In this context, China has invited both Chancellor Friedrich Merz and Federal President Frank-Walter Steinmeier, although the exact dates are still pending. Tagesschau reports that…

A positive sign in economic cooperation is the Chinese Ministry of Commerce's commitment to secure the export of semiconductors from the manufacturer Nexperia. This development was seen by the Federal Ministry of Economics as a promising first signal of a possible easing of tensions in bilateral economic relations. The export restrictions for rare earths have also been relaxed and could bring a significant advantage to German industry. China has announced that it will suspend its previously strict export controls for a year, although this does not yet apply to all countries.

Economic relationships in focus

The economic ties between Germany and China remain strong despite the political challenges. Germany plays a key role as China's most important trading partner in Europe, while China is Germany's most important economic partner in Asia. The bilateral trade volume reached almost 300 billion euros in 2022, with German exports to China amounting to 107 billion euros and Chinese exports to Germany amounting to 192 billion euros. The diplomatic mission of Germany in China emphasizes that...

• Deutscher Direktinvestitionen in China 2022: 122,41 Milliarden Euro.
• Chinesische Direktinvestitionen in Deutschland: 4,77 Milliarden Euro.

Trade relationships are particularly strong in the mechanical and automotive industries as well as in electrical engineering. The Chinese “Made in China 2025” strategy focuses on the development of key technologies, which represents a particular challenge for German companies. Domestic companies must prepare for increasing competition intensity as China strives to become more independent not only at home but also internationally.

For weeks there have been concerns about the diplomatic language used in dealing with China. SPD politician Adis Ahmetovic calls for more restraint in rhetoric and emphasizes that critical issues should still be addressed openly. Wolfgang Niedermark, general manager of the Federation of German Industries, sees the current situation as a “breathing space” and appeals for the need for more independence from China. However, it remains to be seen how the dialogue between the two countries will develop.

The look forward

Another important step will be that Vice Chancellor and Finance Minister Lars Klingbeil will be the first cabinet member to travel to China to take part in a fiscal policy dialogue and a party dialogue. Many in politics are aware that the path to a more stable relationship must be paved through targeted discussions and cooperation, including in view of the challenges associated with China's use of economic power. While political forces within Germany are divided, the appeal for constructive communication is necessary to realize the full potential of bilateral relations.