“
But the strategy paper confirmed a shift. It did not talk of hope of “Wandel durch Handel“ (change through trade), once a motto of the Merkel era. “De-risking is urgently needed,” the document said, using the now standard language of EU and American officials when referring to the dangers of over-reliance on economic ties with China. It echoed the EU’s labelling of China as a “systemic rival” and said China’s friendly relations with Russia had “direct security implications for Germany”. It warned that military escalation by China in the Taiwan Strait would “affect German and European interests”. The paper promised that Germany would co-ordinate “more closely” with its partners in the EU on China matters. It did mention a relationship of trust: with America. Andrew Small of the German Marshall Fund of the United States, a research centre, calls the language “markedly different from where we were with Merkel and the way she was willing to frame things”.
Business decisions
Mr Small says that, though large German firms have expressed support for the strategy, “they haven’t jumped in to embrace it”. They have much at stake. According to the Rhodium Group, a research firm, Germany’s three big carmakers—BMW, Daimler and Volkswagen—plus BASF, a chemicals giant, accounted for more than one-third of all European direct investment in China between 2018 and 2021. But the paper is softer than a version that was leaked in November: no more talk of “stress tests” of German companies that are heavily involved in China, or making them “specify and summarise relevant China-related developments”. De-risking, it appears, will be up to businesses themselves. Some of them may not share the government’s sense of urgency.”
