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Merkel's visit to China: 'Working together will become more difficult'

German Chancellor Angela Merkel is visiting China for the eighth time. But the relationship with the economic powerhouse has its shortcomings. In an interview, Johannes Buckow from MERICS tells DW where the problems lie.

DW: Germany's Chancellor is visiting China beginning Wednesday. Politicians in both countries always emphasize the fact that China and Germany maintain a "comprehensive strategic partnership". What does that mean?

Johannes Buckow: Germany and China currently communicate on 70 permanent dialogue platforms. In Germany, these platforms are spread across all ministries and remain in use even after the government changes. The intergovernmental consultations held nearly every two years, i.e., the meeting of the cabinets of both countries - are the most popular form of communication.

When Germany and China upgraded their "strategic partnership" to a "comprehensive strategic partnership" in March 2014, they thereby agreed to work more closely together in the future; for example, on major global issues like security policy, international crises, regional and global conflicts.

Since then, the two governments have, in fact, have exchanged information on many international conflicts, such as the crises in Ukraine and Syria. But barely any joint initiatives have been established in reality, although it must be said, that such partnerships need time to pick up speed. And in uncertain times, this can certainly take a bit longer.

The opportunities for addressing critical issues have always been the dialogues on the rule of law and human rights. Do they still work? The appeal of imprisoned journalist and DW correspondent Gao Yu has, nevertheless, already been postponed three times.

Johannes Buckow

Johannes Buckow

In recent years, these two forms of dialogue become significantly more complicated than in the days of the last generation of leaders associated with Hu Jintao and Wen Jiabao. For some time now, it seems like Beijing has been closing the networks that once allowed Germans to address sensitive topics, such as the fate of imprisoned journalists

This is obvious when you see the topics of discussion: The last dialogue on rule of law in July 2015 was about domestic violence. Of course, it is a very important issue, but at the same time, very far removed from much more touchy political topics, like the principle of judicial independence and protecting people from police brutality.

In recent years, stock market turbulence and the adjustment of the exchange rate have caused disturbances on the capital market. Is the country still a reliable economic and trade partner?

Business with China is still very important for many German companies and this will continue in the medium to long term, even though the business environment is becoming more difficult. Even before the stock market turmoil, many companies had been carefully considering consider whether they should move their activities to other markets. Manufacturers who produce in China have been battling rising wages and tougher competition from Chinese companies.

Even as a sales market, China is undergoing major changes. Many companies will have to adjust to the greater pressure on margins and significantly slower growth. Much less construction machinery, for example, will be sold in the future. In other industries such as robotics or the food industry, there are still huge opportunities for growth.

China aims to become a strong industrial nation and would like to compete against Germany. Is cooperation between rivals possible?

The present economic difficulties will slightly curb China's fast-track growth. Nevertheless, cooperation with Chinese businesses will definitely become more difficult, the more Chinese companies catch up economically and enter the key markets of German manufacturers, especially given the fact that the Chinese IT market has been shutting out foreign competition.

Many German companies have shown great skepticism towards the planned innovation partnership known as "Industry 4.0". In my view, this reluctance is well justified. Many small and medium-sized companies consider the potential loss of sensitive company data to be a great risk. Under the current conditions in China, data security cannot be fundamentally guaranteed. The required exchange of data between German companies and Chinese partners and suppliers in "Industry 4.0" is barely conceivable at the moment.

In 2014, the framework for action in German-Chinese cooperation was called "Shaping innovation together". Have the countries adopted it?

The framework for action actually contained some very specific projects, often pre-determined projects with their own contracts. Overall, however, some parts were formulated much too ambitiously for German industry.

Some of the optimistic objectives can be viewed in a more realistic light today, like "third market entry by means of new forms of innovation cooperation". This was formulated a year ago, meaning under far better economic circumstances, and the point was last on the list of possible cooperation projects in economic affairs.

Since then, not much real progress has been made. But there are actually some opportunities in this field: In the development of environmental solutions for megacities in developing countries, German and Chinese companies could, for example, complement each other well - technological expertise on the German side and experience with infrastructure in megacities of the Chinese side.

Johannes Buckow is a researcher in the research department at the Mercator Institute for Policy Studies China (MERICS). He focuses on crisis management and China's relations with Germany and Europe.

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