Balance between Partners, Competitors and Systemic Rivals: Germany's New China Policy

As Europe's largest economy, Germany is seeking a balanced approach to its relationship with China, which it views as a partner, competitor and systemic rival.

The new 64-page policy blueprint reflects this aim, with the goal of "reducing critical dependencies in future" while remaining "realistic but not naive".

The policy is the product of compromise between Germany's ruling coalition, with Foreign Minister Annalena Baerbock of the Greens pushing for a more hawkish line and Chancellor Olaf Scholz of the Social Democrats leaning more towards a trade-friendly stance.

The strategy document acknowledges the increasing dependency of Germany on China, while emphasising that the country does not seek to impede Beijing's economic progress.

Berlin worries about China's efforts to influence the international order and disregard human rights, while also noting the need for cooperation in order to address the climate crisis.

The government has been attempting to diversify away from reliance on China, citing it as the “biggest threat” in regards to economic espionage. China has been alarmed by the harder line taken by Germany, as well as the European Commission's stance towards Chinese telecoms giants Huawei and ZTE.

However, Prime Minister Li Qiang noted during his first overseas trip in Germany that Beijing places a priority on improving relations with the EU, and he warned against using “de-risking in name to carry out decoupling”.

Despite criticism over Scholz’s acquiescence to a Chinese request not to allow journalists to ask questions at a press conference, the German government appears resolute in its stance to balance its interests with those of China.