German Chancellor Olaf Scholz concluded his three-day visit to China with a crucial meeting with Chinese President Xi Jinping on April 16, 2024. The visit was aimed at bolstering business ties with Germany’s largest trading partner while also addressing concerns about China’s increasing exports to Europe and discussing the impact of Russian war in Ukraine.
During his visit, Scholz held meetings with Chinese President Xi Jinping and Premier Li Qiang to exchange views on bilateral relations, particularly trade issues.
Scholz is the first Western major country leader to visit China this year. This is his second visit to China since taking office. The visit came amid growing tensions between Europe and Beijing over claims of unfair competition.
Scholz kicks off visit in Chongqing
German Chancellor Scholz began his three-day visit in the southwestern Chinese city of Chongqing. Scholz joined by senior German executives underlining the importance of the Chinese market to Europe’s largest economy.
German chancellor was accompanied by a large business delegation, including Ola Kallenius, chairman of Mercedes-Benz, and Oliver Zipse, chief executive of BMW, as well as executives from German firms Bayer, Siemens and ThyssenKrupp.
In Chongqing, he visited German auto supplier Bosch’s hydrogen fuel cell plant, a Sino-German joint venture that develops, assembles and sells fuel cell systems.
Germany had set up a total of 84 companies in the southwestern metropolis, playing a role in “the construction and development of Chongqing”, according to Shangyou News, an online news platform affiliated with the official Chongqing Daily.
“Scholz’s second official visit to China since taking office shows that there remains a need for Germany to maintain and deepen economic and trade cooperation with China, although the German government has emphasized ‘de-risking’ in its view on China-Germany and China-EU relations,” said Ding Chun, director of the Center for European Studies at Fudan University.
The bilateral annual trade volume between China and Germany surpassed of 253 billion euros (US$268 billion) in 2023, according to the German Federal Statistical Office Destatis.
Xi and Scholz discuss cooperation and trade issues
Chinese President Xi Jinping emphasized that cooperation between China and Germany was not a “risk” but a guarantee for stable ties and an opportunity for the future, amid complaints by the European Union about Chinese products flooding the bloc’s markets.
Industrial and supply chains of China and Germany are deeply interconnected, with their markets highly interdependent, Xi told German Chancellor Olaf Scholz, who is in China on a three-day visit with several leading German executives.
“We must view and develop bilateral relations in an all-round way from a long-term and strategic perspective,” Xi said.
Scholz’s visit to China marked his first since his government initiated a “de-risking” strategy last year to reduce reliance on Chinese suppliers. His visit also aligned with EU concerns about the influx of Chinese goods, including electric vehicles and green technologies, posing a threat to European businesses.
Addressing these concerns, Xi told Scholz: “China’s exports of electric vehicles, lithium batteries and photovoltaic products have not only enriched global supply and alleviated inflationary pressure, but also contributed greatly to the response to climate change and green and low-carbon transformation”.
German Chancellor Olaf Scholz meets Chinese President Xi Jinping at the end of three-day visit to China 🇩🇪🇨🇳 pic.twitter.com/nSKkdx9Zxv
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“Be it traditional fields such as machine manufacturing and automobiles, or new areas like green transition, digitalization or Artificial Intelligence, the two countries have huge potential for win-win cooperation yet to be explored,” Xi said, according to state media Xinhua.
The German chancellor also talked about closer cooperation with China, saying “Both China and Germany are trading nations that profit greatly from the WTO” and that “Both countries have a responsibility to protect global public goods.” He strongly advocated a rule-based system of trade such as that embodied by the World Trade Organization (WTO).
German leader welcomes Chinese cars but urges ‘fair’ competition
German Chancellor Olaf Scholz said Chinese cars would be welcome in Germany but called for a “fair” competition, warning against the use of unfair trade practices.
Germany’s economy has benefited from Chinese demand for products such as cars and chemicals. However, German companies claim they encounter unfair market barriers in China, straining relations.
Scholz, while speaking at Tongji University in Shanghai, said when Japanese and South Korean cars entered European markets, it was feared that they would completely conquer the market in a one-way shift toward Asia.
“There are Japanese cars now in Germany and German cars in Japan,” said the chancellor. “And the same applies to China and Germany.”
“At some point, there will also be Chinese cars in Germany and Europe. The only thing that must always be clear is that competition must be fair. In other words, that there is no dumping, that there is no overproduction, that copyrights are not infringed,” Scholz said.
Xi urges seeking ‘common ground’ in meeting with Scholz
Meanwhile, Xi said two-way ties with Germany would continue to develop gradually as long as the two countries respected each other and sought “common ground” while reserving differences.
“We must view and develop bilateral relations in an all-round way from a long-term and strategic perspective,” Xi told Scholz in Beijing.
“As long as both sides adhere to mutual respect, seek common ground while reserving differences, communicate and learn from each other, and achieve win-win co-operation, relations between the two countries will continue to develop steadily,” the Chinese president added.
Scholz discussed Russia’s war in Ukraine
While the visit focused on resolving trade issues and exploring business opportunities in China, Scholz also discussed Russia’s war in Ukraine. He called on Xi to “contribute more to a just peace in Ukraine,” adding that “The Russian war of aggression against Ukraine and Russia’s rearmament have had a very significant negative impact on security in Europe. They directly affect our core interests,” he told Xi.