“Wandel durch Handel” must make way for a new strategy. But what kind?by Paul Lever / July 28, 2020 / Leave a comment
In a recent interview Peter Altmaier, the German Minister for Economic Affairs, was asked whether China’s imposition of a draconian national security law on Hong Kong or its treatment of the Uighurs would have consequences for Sino-German trade. His response was an unequivocal no. Germany, like all other western countries, had, he said, always maintained commercial relations with countries with poor human rights records, China was an important trade partner and nothing useful would be achieved by introducing sanctions or boycotts.
Indeed he went even further. Trade was the means by which over time western countries could hope to influence repressive regimes to moderate their policies. Wandel durch Handel, “change through trade,” is now, it seems, the leitmotiv of German policy towards China.
China is Germany’s most important export market. In 2019 Germany sent goods worth around €100bn there, more than to the United States. For German manufacturers, particularly car manufacturers, China is of existential importance. They would lobby vigorously against any suggestion that it might be subject to commercial restrictions like those imposed by Donald Trump.
German ministers too have always treated China with respect. Since the time of Helmut Kohl German chancellors have been regular visitors to Beijing. In her 15 years of office Angela Merkel has been there almost every year. When she goes she is usually accompanied by a selection of CEOs from the major German companies. This is partly to introduce them to the Chinese political leadership; partly also to emphasise Germany’s unique strengths in the field of manufacturing. Being the country of Bosch, BMW, Mercedes, Siemens and Volkswagen is what gives Germany its global power.
Germany is not purely mercantilist in its foreign policy. The government has been surprisingly robust in endorsing sanctions on Russia following its annexation of Crimea and occupation of eastern Ukraine. Last week the German Foreign Minister, Heiko Maas, reiterated opposition to the suggestion from the United States that Russia might be readmitted to the G7. But the sanctions to which Germany has agreed do not impinge on its core commercial interests. German imports of natural gas from Russia continue unaffected; and opposition from Poland and elsewhere has not prevented the construction of the Nordstream gas pipeline between Vyborg and Greifswald.
And even in relation to China the concept…