German strategy paper targets China trade dependence - news portal

When contacted by Reuters, the ministry said it would not comment on internal processes, but added it was already public knowledge that Berlin wanted to make it more attractive for German companies to invest in relatively underserved markets. Reuters has previously reported that Germany is seeking to reduce its dependence on Beijing and is developing a new China strategy, but it could be a tricky task with deep trade ties between Europe's and Asia's biggest economies.

Economy Minister Robert Habeck wants to make Germany more independent from China for trade by focusing on alternative markets, news portal The Pioneer reported, citing a strategy paper it said Habeck adopted this week.

The German website added that officials at the ministry expected Taiwan to be annexed by China by 2027 at the latest. When contacted by Reuters, the ministry said it would not comment on internal processes, but added it was already public knowledge that Berlin wanted to make it more attractive for German companies to invest in relatively underserved markets.

Reuters has previously reported that Germany is seeking to reduce its dependence on Beijing and is developing a new China strategy, but it could be a tricky task with deep trade ties between Europe's and Asia's biggest economies. As part of the strategy, Berlin is aiming to create incentives for German companies to investment beyond China, according to a draft document seen by Reuters last month.

It plans to make investment guarantees more expensive for countries that are already in high demand to avoid being too exposed to a small group of markets, the document said. Germany has so far in 2022 provided 29 billion euros ($30 billion) of investment guarantees to companies, according to the economy ministry.

In the 100-page paper cited by The Pioneer, ministry officials called for a diversification of trade relations away from China and a new "technological sovereignty". "While China is reducing its dependence, China's economic importance for the EU and Germany continues to increase," The Pioneer quoted the report as saying.

It is unclear "to what extent the Chinese market will still be open to foreign companies", Habeck's officials wrote in the paper, according to the news portal. The ministry proposed, among other things, a focus on "alternative future markets such as Asia-Pacific, Latin America and Africa".

China became Germany's top trade partner in 2016. German carmakers are especially exposed to the Chinese market, with Volkswagen making around half its profits there. Germany, and Europe, also rely on China for certain raw materials, such as rare earths.

($1 = 0.9581 euros)

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)