Driving commercial and political engagement between Asia, the Middle East and Europe
Driving commercial and political engagement between Asia, the Middle East and Europe
Driving commercial and political engagement between Asia, the Middle East and Europe
With China agreeing to buy more US products in a bid to reduce its trade surplus with Washington, one of the big losers could be Germany – currently China’s biggest European trading partner.
This will be at the forefront of German Chancellor Angela Merkel’s mind as she tours China this week to shore up a trade relationship worth $180bn a year.
According to Bloomberg, the agreement reached between China and the US in recent talks will leave Germany ‘squeezed in the middle.’
Former Chinese diplomat to Brussels, Wang Yiwei, commented: “China will buy more and more products from the US that we might have otherwise bought from Europe or other partners.
“This will certainly have a spillover effect.”
Perhaps in a bid to alleviate German concerns, Beijing has welcomed Chancellor Merkel to China with promises to open up its auto sector to German companies.
Premier Li Keqiang said on Thursday that China “welcomes investment by German automakers working to produce autonomous vehicles,” Nikkei Asian Review reports.
China, which aims to be a world leader in autonomous driving, perhaps sees partnership potential in Germany, given its strength in auto manufacturing. Yet it should also be noted that opening up China’s auto market is a key ask of Washington in the ongoing trade wrangling, potentially offering Chancellor Merkel an opportunity to put pressure on President Trump.
Germany has a desire to “deepen cooperation with China in the field of autonomous driving” as long as “German businesses would be treated as equals” to Chinese counterparts, Merkel said.
In what could be seen as comments aimed at a White House increasingly protectionist in character, Reuters reports Premier Li as saying that Germany and China will continue to “uphold free trade.”
Chancellor Merkel, who also met with President Xi Jinping on Thursday, is in China for two days. The South China Morning Post outlines a range of other issues likely to be discussed, including the geopolitical and security situations in Iran and North Korea, and human rights in China.
The squeeze effect of the US – China tensions on the EU will be discussed by Philippe Duponteil, Directorate General for Trade of the European Commission, at Asia House today, when he briefs Asia House corporate members on: ‘The US-China Power Play – Where Does the EU Stand?‘
