No Longer Poor?
July 27, 2007
Politicians from Germany's governing conservative Christian Democratic Union (CDU) and the opposition free-market liberal FDP said this week there was no reason to continue providing generous development aid to China.
Rainer Brüderle, deputy chairman of the FDP told mass market Bild daily that China was "a successful hi-tech nation and not a developing country."
The view was echoed by Wolfgang Bosbach of the CDU.
"The German government needs to examine whether it should continue paying development aid to China," he said.
According to the news report, China will receive 67.5 million euros ($92.1 million) this year from the German Ministry of Economic Cooperation and Development.
German government rejects demands
The German government, however, has rejected the demands from the two politicians, saying the money that flowed to China this year was transferred within the framework of long-term and successful economic cooperation.
"China doesn't receive any development aid from Germany," Thomas Steg, a press spokesman for the government said in Berlin. "This cooperation is explicitly in German interests."
German Development Minister Heidemarie Wieczorek-Zeul also stressed that development aid to China had been adapted to the country's changing economic dynamics over the years.
"The funds by the German government are largely provided as loans with market conditions and are paid back by China," the minister said.
China can now afford to fight poverty within its own borders on its own, Wieczorek-Zeul said. She added that the bulk of current development money focused on boosting environmental protection as well as supporting legal and political reforms.
Steg added that the former included promoting renewable energy and helping improve energy efficiency. He pointed out that it "always results in renewed contracts for German companies."
China is considered the world's second biggest emitter of carbon dioxide, after the United States, and the biggest producer of sulfur dioxide.
Chinese economy hurtles ahead
The debate over putting the brakes on development aid to China follows the recent publication of statistics that show the Asian country's economy is galloping ahead at a rapid pace. It grew by 11.9 percent in the first quarter of this year, according to China's National Statistics Bureau.
Some experts say that if present economic growth rates are sustained, China could in five years replace Germany as the world's third largest economy after the US and Japan, and other experts have said Germany has already been knocked into fourth place. China's exports are expected to grow at an annual rate of 20 percent in 2007 and 2008 compared with 9 percent for German exports over the same period.
In 2005, China surpassed Britain to become the world's fourth largest economy. The World Bank listed China's GDP at $2.7 trillion, slightly behind Germany's $2.9 trillion.