Former Chancellor Angela Merkel’s commercially-focused approach is headed for the bin, as Berlin puts the final touches to the upcoming Germany China Policy.
“There will be some pretty hard language throughout the document,” a senior German official involved with Asian policy told Nikkei. The draft is with the foreign ministry. As soon as this summer, the cabinet will officially approve the plan.
Some of the more drastic prescriptions include limiting investment in China and governmental monitoring of German companies that depend too much on China for its business, officials familiar with the paper say. Slowly but surely, the plan is to reduce the weight of China from the German business scene.
In a bid to prevent dual-use technology from falling into Chinese hands, even academic exchanges may be restricted, officials said.
The final document could end up looking more moderate, as the hard-line Greens and the centre-left Social Democrats battle it out in the coalition over the details. But in general, the message is unmistakable: distancing Germany from China.
Until recently, the mainstream view in German politics was to not pick sides in the US-China rivalry so as to keep diplomatic options open.
But omnidirectional diplomacy leaves gaps that can easily be exploited by authoritarian states. Also, leaning too heavily on certain countries economically is risky, as Germany learned so painfully by depending on Russia for its energy.
Germany’s more skeptical approach to Beijing is reflected elsewhere in Europe. In France, security concerns are looming ever larger.
“I absolutely do not want any French territory to become Chinese territory,” said lawmaker Anne Genetet, an Asian expert in the ruling party, referring to strategic islands in the Pacific that are still French-ruled.
Much of French territory in the Indo-Pacific, such as New Caledonia, is in the Southern Hemisphere. Genetet suggests that France team with democracies in the Indo-Pacific’s Northern Hemisphere, such as the US and Japan, to strengthen deterrence. She has expressed strong interest in collaboration with the Quad nations of the US, Japan, India and Australia.
French sentiment toward the US has always been complicated. While France helped the US achieve independence in the 18th Century, it does not share the “survival of the fittest” capitalism that rules America. France has always held a feeling of rivalry with Anglo-Saxon countries like the UK and the US, and certainly does not want to be in a little-brother relationship with Washington.
French-US relations took a nose dive when Australia ditched a submarine contract with France to acquire nuclear-powered submarines with the assistance of the US under the new Aukus security grouping, which includes the UK.
That changed overnight after Russia invaded Ukraine, and suddenly the US and France were back on the same side, facing off against autocracies.
In Italy, new Prime Minister Giorgia Meloni has openly called her country’s 2019 decision to sign a memorandum of understanding on the Belt and Road Initiative with China a “big mistake” and has vowed to review Rome’s collaboration with Beijing over the infrastructure project. She took part in an interview with Taiwan’s Central News Agency during the campaign.
The feeling in Europe is that Russia will only deepen its reliance on China in the coming years. A combination of energy-rich and military heavyweight Russia teaming with economic powerhouse China keeps European leaders awake at night.
The Ifo Institute of Germany calculates that if European trade with China is restricted, it would push Germany’s gross domestic product growth down by close to 1 percentage point and have wide implications on other European countries.
Yet, if there is a Taiwan contingency, the European Union, led by Germany and France, would come under pressure to impose economic sanctions on Beijing.
The game plan is to gradually reduce dependence on China over time, without angering Beijing too much. That is why German Chancellor Olaf Scholz visited China. This year, more cabinet heavyweights are planning to visit China. France is considering a top-level visit of its own.