German Risky Chinese Romance – CEPA | Daily News Byte

Despite growing calls to reassess Sino-German relations, Chancellor Olaf Scholz is struggling to maintain a central place in China politics. Before his trip to Beijing in November, Scholz published an op-ed in which he continued Germany’s steady embrace of what he sees as stability and interconnectedness.

Scholz’s balancing act rejected both “calls by some to isolate China. . . [or the] the search for hegemonic Chinese dominance, or even a Sinocentric world order,” and highlighted the current reality that “China remains an important business and trade partner of Germany and Europe. . . [and] we don’t want to separate ourselves from that.” The chancellor did, however, call for “diversification and strengthening our own resilience”, in response to China’s lack of reciprocity in key sectors.

This status quo approach, which suggests several improvements along the edges, is contested in his Ampelcoalition (coalition of traffic lights) government of social democrats, greens and free democrats. China is increasingly seen as a threat to German and European security across the political spectrum. Under the leadership of President Xi Jinping, who has, for example, built a blue-water navy almost from scratch, many see a more assertive China signaling the ability and intent to reshape the world order.

Europe was caught off guard by Russia’s war of aggression in Ukraine and reassessed Chinese moves that could herald a new strategy. China’s desire for a naval base on Africa’s Atlantic coast in Equatorial Guinea, its deployment of warships for exercises with its Russian ally in the Baltic, and regular joint air and naval operations apparently aimed at Japan signal that Xi’s China is now able to deploy a significant military force in the short term.

Europe is also home to China’s 16+1 forum with Central and Eastern European countries, part of its global infrastructure initiative Belt and Road. Although the program lost momentum, its goals were widely seen as hostile, relying as it does on so-called debt trap diplomacy.

Russia’s all-out invasion in February forced Germany to face its dependence on cheap Russian natural gas. The decision and its implications have fueled an internal debate within Ampelcoalition on bilateral relations with China. Although Russian trade with Germany was not very significant (except for energy), bilateral commercial relations with China became a key part of its economic strategy. Currently, China is Germany’s largest trading partner — the two countries are on track for a trade volume of 245 billion euros ($261 billion) in 2021. Green, as well as federal Free Democrat ministers, are now openly arguing that this imbalance must change, and quickly.

In a recent partial leak of a Chinese strategy document, Germany’s Ministry of Economic Affairs and Climate Action, led by Green Party leader Robert Habeck, warned that China’s “importance as an export market for many German industrial sectors, as well as critical dependencies in certain . . . areas can make Germany vulnerable to blackmail and limit its political capacity to act”.

Concerned about China’s “pro-Russian attitude toward the attack on Ukraine,” the memo concludes by recommending that Germany ban the procurement of critical infrastructure from authoritarian states. This proposal, however, should not come as a surprise. The Green Party has long prioritized human rights as Germany’s key foreign policy goals and has become more vocal in its distrust of China. Earlier this summer, after the release of a report on China’s brutal treatment of the Uyghur minority, Haback said that “we diversify more and reducing our dependence on China. Respect for human rights has more weight.” These comments were further underlined by his colleague, Green Party leader, Foreign Minister Analena Burbock, who stated that “China’s political system has changed a lot in recent years and therefore our China policy must also change.”

The challenge in understanding Germany’s China policy ultimately boils down to seeing the intellectual underpinnings that drive Chancellor Scholz’s thinking. Shortly after visiting China, he doubled down on his warning that “China’s rise does not justify isolating Beijing or curbing cooperation.”

Here Scholz follows a long line of German chancellors who advocated accommodation rather than open confrontation in dealing with warring great powers. German foreign policy thinkers often fear the potential unintended consequences if policy alienates authoritarian regimes, such as Russia and China. They would rather work with them through existing institutions — such as Merkel’s Wandel durch Handel (or changes through trade) strategy — rather than dealing with the consequences of a powerful country acting through enforced isolation.

Now, with cheap Russian energy on the table, continued uncertainty about American resolve and European displeasure that the US appears to be thriving on energy and arms sales while it suffers, China’s giant market of 1.4 billion consumers is hesitantly seen as a lifeline to stabilize the German economy. China skeptics and hawks within Ampelcoalition he will have to fight this realpolitik considerations if they hope to succeed in recalibrating Sino-German relations.

Where can and should Germany go next with regard to China? Policy makers could easily allow current trends to continue and focus on integration, stability and growth. While this route offers immediate gains, its lack of long-term strategic vision runs counter to Scholz’s letter and spirit Zeitenvende-Politik (milestone) security commitments made earlier this year following Russia’s February invasion. Additionally, the various recommendations to disengage China from Germany’s so-called critical infrastructure fall short of the task at hand — which is to reduce overall dependence. This will require the federal government to conduct a full economy-wide assessment of how its export-led economy can diversify away from reliance on China’s growing middle class. Moreover, Germany will need to take a greater leadership role on this issue across the continent, especially through the European Union.

This should include a reassessment of current trade arrangements, capital for needed infrastructure projects for member states and diplomatic efforts to win support for a more economically independent Europe. Germany’s first national security strategy, to be published in the coming months, will be a good starting point for clarifying the current coalition government’s approach to Sino-German relations. Now the question is whether it will live to the present moment?

Aaron Allen is a non-resident senior fellow in the Democratic Resilience and Transatlantic Defense and Security programs at the Center for European Policy Analysis (CEPA). Most recently, he was a National Security Fellow at the Robert Bosch Stiftung where he worked for the German Coordinator for Transatlantic Cooperation in the Bundestag and the Auswartiges Amt in Berlin. He previously served in the US House of Representatives as a foreign policy advisor.