Secretary General of the Sino German Chamber of Commerce: Unreal decoupling between Germany and China

Global Times Global Network reporter Ni Hao Yan Si, Secretary General of the German Chamber of Commerce in China, recently stated at a forum in Beijing that "decoupling" between Germany and China is unrealistic, and "de risk" not only means increasing costs, but also difficult to achieve in the short term. He stated that Germany's "China strategy" needs to take into account the actual situation of German companies in China.
In July of this year, after a long period of deliberation and bargaining, the German government released its first "China Strategy", with its core content being "risk reduction" and "reducing dependence on China". This strategy seeks to reduce dependence on China in key areas while continuing to participate in China's economic development, in order to reduce risks. This "China Strategy" reaffirms the position of not seeking to "decouple" from China and is seen as a guide for Germany's actions towards China in various fields in the future.
On September 19th, Yan Si discussed his views on Germany's first "China Strategy" during his opening speech at the 2023 Beijing CBD Forum. He stated that China Germany economic and trade cooperation has a long history and has been steadily developing. The German government has abandoned the idea of "decoupling" in its "China strategy," which is a good thing.
China is the second largest economy in the world, and 'decoupling' from it is unrealistic, "he said." De risk "means opening up new (procurement and sales) markets. The headquarters of the German Chamber of Commerce in China has conducted a survey of its member companies, and nearly one-third of them believe that finding new procurement and sales markets will be a major challenge for business operations. Yan Si believes that this undoubtedly means an increase in costs for German multinational enterprises, and it is difficult to achieve "risk reduction" in a short period of time.
Public information shows that China and Germany have strong economic complementarity, and bilateral economic and trade relations have been continuously growing. In 2022, the trade between China and Germany reached 298.9 billion euros, an increase of approximately 21% compared to 2021. China has become Germany's largest trading partner for the seventh consecutive year, and Germany has also become China's largest trading partner in Europe for 48 consecutive years. More than 5000 German companies operate subsidiaries and factories in China, many of which are highly focused on the Chinese market and rely on their profits in China.
At present, investment from German companies continues to flow into China. On the 21st, Reuters exclusively cited data from the German Institute of Economics (IW), showing that Germany's investment in China in the first half of 2023 was 10.31 billion euros. Although it decreased from 12 billion euros last year, it is still nearly twice the investment amount of 5.5 billion euros before the 2019 pandemic, and more than twice the average investment amount of 4 billion euros in the same period of the past decade. IW stated that in the first half of this year, the proportion of investment in China to Germany's outward investment has increased from 11.6% last year and 5.1% in 2019 to 16.4%.

Yan Si emphasized, "Ultimately, the 'China strategy' should still depend on specific actual situations. Our common goal is to combine the implementation of the 'China strategy' with the actual situation of the enterprise, which is the responsibility of our chamber of commerce

Zheng Chunrong, director of the German Research Center at Tongji University, recently published a signed article in the Global Times, pointing out that at a time when the global economy was sluggish and market demand was shrinking, the Chinese market was almost the only profitable market for German giants such as the automotive and chemical industries; When Germany and Europe were hit by the European debt crisis, it was also the joint cooperation between China, Germany, and China Europe that helped Germany and Europe emerge from the crisis as soon as possible. Recently, some foreign media have portrayed competition from China as the reason for Germany's economic difficulties, which is driven by ulterior motives in public opinion. In fact, China and Germany have strong cooperation needs and potential in various fields such as advanced manufacturing, innovation, and environmental protection. Therefore, solving a series of problems currently facing the German economy and maintaining and strengthening practical cooperation with China is the correct solution.