Tuesday, June 28, 2011

Germany and China-Mr Wen goes to Berlin

THE Chinese prime minister, Wen Jiabao, is visiting three countries on his European tour this week. But his previous stops, in Hungary and Britain, were sideshows next to today’s visit to Germany. To this Mr Wen has brought 13 ministers (to meet their ten German counterparts). The two countries plan to sign 22 co-operation agreements and 14 economic deals. The meetings mark the start of permanent consultations, a relationship Germany has with just a handful of countries and that China has had until now with none. Before Mr Wen’s visit China issued a “white book” on its relations with Germany, its first such report on a European country.

It is a meeting of winners whose economic relationship is deepening by the day. Trade leaped nearly 40% in 2010 to €130 billion ($185 billion); that accounts for one-third of the European Union’s total trade with China. German companies have invested some €21 billion there. Investment flows the other way are small but growing, and Germany wants more. The widespread fear of Chinese economic might—as Charlemagne wrote yesterday, the European Council on Foreign Relations, a think-tank, is soon to issue a paper saying that China “is taking over Europe”—found little echo in Berlin as Mr Wen came to town.

The visit marks the final burial of the ill feeling that erupted four years ago when the German chancellor, Angela Merkel, had the temerity to receive the Dalai Lama, the exiled leader of restive Tibet, in her office. One Chinese diplomat grumbled at the time that Mrs Merkel viewed China as a bigger version of communist East Germany, where she was born and raised.

That is all forgotten, at least on the official level. In an apparent gesture of goodwill towards Europe, last week China released from detention Ai Weiwei, an artist, and Hu Jia, another dissident. Still, China continues to bridle at the attention paid by ordinary Germans to its human-rights abuses. In a bizarre column for Handelsblatt, a business newspaper, China's vice-foreign minister complained of “arrogant accusations” by the German press.

For their part, the Germans want to avoid making their relationship with China look too mercenary. “Intensive polit. & econ. relations with China are in Germ. interest, don’t rule out plain talk on human rights,” tweeted the government spokesman, Steffen Seibert. But neither country wants such issues to spoil the mood.

For the moment, interests matter more than values. The United States remains Germany’s most important ally, but on economic issues the world’s top two exporters increasingly speak the same language. Germany and China joined forces at last year’s G20 summit in Seoul to block an American proposal to cap current-account imbalances.

Long-running economic arguments may, slowly, be abating. Although China’s lax protection of intellectual-property rights remains an irritant, it is modelling its patent-protection standards on those of Germany rather than on the weaker practices of the United States, notes Michael Hüther of the Cologne Institute for Economic Research.
Some tensions continue to fester. The EU, of which Germany is the weightiest member, still does not recognise China as a market economy, which exposes it to trade sanctions. A new dispute has flared up over the EU’s plans to tax carbon emissions on flights to and from Europe. China has threatened to boycott purchases of Airbus planes over the issue.

Yet Mr Wen and Mrs Merkel are unlikely to let such concerns get in the way of their burgeoning friendship. “Whatever global issue we have, China is part of the problem and part of the solution,” says Eberhard Sandschneider of the German Council on Foreign Relations. Along with its western allies, Germany wants Chinese help to thwart Iran’s nuclear ambitions, restrain North Korea’s aggression, pacify Sudan (which is about to split up into two separate countries) and avert climate catastrophe. The EU’s failure to act coherently on foreign policy makes Germany by default China’s most important European partner.

The flurry of contacts and agreements between German and Chinese ministers touches on everything from hospital management to electric cars. The creation of a mechanism for such discussions is more important than the subject matter (even if Chinese ministers count for less than Communist party bosses). Such consultations have helped Germany and France through rough patches in their relationship, points out Mr Sandschneider. They mean that “you have to meet on a regular basis, whether you like it or not.” The Economist

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