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http://www.nytimes.com/2014/07/05/w...o-keep-alive-golden-decade-of-deals.html?_r=0
BERLIN — With some experts warning that the “golden decade” of rapid growth in German-Chinese trade and dealings may be ending, Chancellor Angela Merkel embarks this weekend on her seventh visit to China, accompanied by top people from German business who, surveys indicate, are still markedly more optimistic about China than are their European counterparts.
Like many people raised in Communist East Germany, where travel abroad was tightly restricted, Ms. Merkel is an avid traveler. As a trained scientist, she is also keenly interested in innovation, and in China she always travels to Beijing and at least one other province for a firsthand look at joint ventures and new Chinese research and enterprises.
This trip takes her first to Chengdu, capital of western Sichuan Province, which, government officials noted, has a population almost as big as Germany’s 82 million. In Chengdu, she will meet the province’s leadership and visit a joint venture operated by the German automaker Volkswagen and a social center designed to help the children of migrant workers. From there, Ms. Merkel flies to Beijing, where she will be received with military honors by Prime Minister Li Keqiang and attend a dinner hosted by President Xi Jinping, but also meet film directors and address students at Tsinghua University.
Both government officials and experts who discussed the trip said that human rights matters, such as any eventual request from Ms. Merkel for China to permit the artist Ai Weiwei to attend his current big show in Berlin, would be dealt with quietly, if raised at all.
Ms. Merkel has been in power since 2005, making her one of the longer-serving heads of government in Europe. She and the German business community have forged strong business and political ties with China — this year alone, President Xi was in Germany in March; Foreign Minister Frank-Walter Steinmeier visited China in mid-April and Sigmar Gabriel, the vice chancellor and economics minister, in late April. While in China on Sunday through Tuesday, Ms. Merkel will oversee the creation of a new economic committee to prepare the ground for high-level talks in Berlin in October designed to map cooperation for the next several years.
Just before Ms. Merkel arrives in Chengdu, senior German and Chinese business people, academics and politicians are meeting on education and innovation. Among the Chinese attendees are Jack Ma, executive chairman of Alibaba Group; Ge Honglin, the mayor of Chengdu; and several academics. The German team is headed by Martin Brudermüller, a member of the board of BASF.
German officials and experts discussing the trip with reporters said recent years have shown that an agenda of social reform can be pursued most effectively in such meetings, enabling China’s leaders to keep matters they deem sensitive behind closed doors.
Business has boomed in recent years. In 2000, government figures show, China accounted for 1.6 percent of all German exports. Last year, that had risen to 6.1 percent of all exports. Government officials, insisting they not be identified, said China is now Germany’s No. 3 market, after France and the Netherlands.
German businessmen are also more confident than their European counterparts that investment in China is worthwhile. Surveys from the European Chamber and in Germany suggest that many Europeans are seeking alternative markets, due to increased costs in China, competition from Chinese companies and problems with market access. The share of European businesses that wants to expand in China dropped to 57 percent this year from 86 percent a year earlier, according to the Mercator Institute for China Studies in Berlin. German businessmen “are significantly more optimistic,” the institute said this week, citing a 2014 business confidence survey by the foreign trade chamber.
“We have had a golden decade in bilateral relations,” said Sebastian Heilmann, director of the Mercator Institute. He noted, however, that “more troubled waters” might lie ahead.
German experts said the current anticorruption campaign in China has cut significantly into sales there of French luxury goods such as fine liquors and perfume — favorite gifts for the Chinese elite, who are now worried about the crackdown.
For German businesses, experts who insisted on anonymity said that there was danger in the tightening credit in the Chinese banking system. Delays of six months in getting payment are harmful for the many medium-sized or small German enterprises, often family-run, that are the backbone of Germany’s export economy and have done booming trade with China in the past 10 years.
Experts also noted that Chinese companies are developing rapidly and becoming ever more competitive with German business.
The government did not release a list of the business people accompanying Ms. Merkel, but her delegation traditionally includes a mix from Germany’s leading Dax 30 companies and smaller companies.
Among the foreign policy issues likely to be raised in Beijing is Ukraine, where pro-Russian separatists and Ukrainian forces continue to fight. Ms. Merkel has been most active in trying to end the bloodshed, warning of further European sanctions if it does not stop. President Vladimir V. Putin of Russia was in China in May and reached what was billed as a landmark deal to sell Russian gas to the Chinese. The price has not been disclosed. German officials noted, however, that it will be at least a decade before deliveries reach capacity.
BERLIN — With some experts warning that the “golden decade” of rapid growth in German-Chinese trade and dealings may be ending, Chancellor Angela Merkel embarks this weekend on her seventh visit to China, accompanied by top people from German business who, surveys indicate, are still markedly more optimistic about China than are their European counterparts.
Like many people raised in Communist East Germany, where travel abroad was tightly restricted, Ms. Merkel is an avid traveler. As a trained scientist, she is also keenly interested in innovation, and in China she always travels to Beijing and at least one other province for a firsthand look at joint ventures and new Chinese research and enterprises.
This trip takes her first to Chengdu, capital of western Sichuan Province, which, government officials noted, has a population almost as big as Germany’s 82 million. In Chengdu, she will meet the province’s leadership and visit a joint venture operated by the German automaker Volkswagen and a social center designed to help the children of migrant workers. From there, Ms. Merkel flies to Beijing, where she will be received with military honors by Prime Minister Li Keqiang and attend a dinner hosted by President Xi Jinping, but also meet film directors and address students at Tsinghua University.
Both government officials and experts who discussed the trip said that human rights matters, such as any eventual request from Ms. Merkel for China to permit the artist Ai Weiwei to attend his current big show in Berlin, would be dealt with quietly, if raised at all.
Ms. Merkel has been in power since 2005, making her one of the longer-serving heads of government in Europe. She and the German business community have forged strong business and political ties with China — this year alone, President Xi was in Germany in March; Foreign Minister Frank-Walter Steinmeier visited China in mid-April and Sigmar Gabriel, the vice chancellor and economics minister, in late April. While in China on Sunday through Tuesday, Ms. Merkel will oversee the creation of a new economic committee to prepare the ground for high-level talks in Berlin in October designed to map cooperation for the next several years.
Just before Ms. Merkel arrives in Chengdu, senior German and Chinese business people, academics and politicians are meeting on education and innovation. Among the Chinese attendees are Jack Ma, executive chairman of Alibaba Group; Ge Honglin, the mayor of Chengdu; and several academics. The German team is headed by Martin Brudermüller, a member of the board of BASF.
German officials and experts discussing the trip with reporters said recent years have shown that an agenda of social reform can be pursued most effectively in such meetings, enabling China’s leaders to keep matters they deem sensitive behind closed doors.
Business has boomed in recent years. In 2000, government figures show, China accounted for 1.6 percent of all German exports. Last year, that had risen to 6.1 percent of all exports. Government officials, insisting they not be identified, said China is now Germany’s No. 3 market, after France and the Netherlands.
German businessmen are also more confident than their European counterparts that investment in China is worthwhile. Surveys from the European Chamber and in Germany suggest that many Europeans are seeking alternative markets, due to increased costs in China, competition from Chinese companies and problems with market access. The share of European businesses that wants to expand in China dropped to 57 percent this year from 86 percent a year earlier, according to the Mercator Institute for China Studies in Berlin. German businessmen “are significantly more optimistic,” the institute said this week, citing a 2014 business confidence survey by the foreign trade chamber.
“We have had a golden decade in bilateral relations,” said Sebastian Heilmann, director of the Mercator Institute. He noted, however, that “more troubled waters” might lie ahead.
German experts said the current anticorruption campaign in China has cut significantly into sales there of French luxury goods such as fine liquors and perfume — favorite gifts for the Chinese elite, who are now worried about the crackdown.
For German businesses, experts who insisted on anonymity said that there was danger in the tightening credit in the Chinese banking system. Delays of six months in getting payment are harmful for the many medium-sized or small German enterprises, often family-run, that are the backbone of Germany’s export economy and have done booming trade with China in the past 10 years.
Experts also noted that Chinese companies are developing rapidly and becoming ever more competitive with German business.
The government did not release a list of the business people accompanying Ms. Merkel, but her delegation traditionally includes a mix from Germany’s leading Dax 30 companies and smaller companies.
Among the foreign policy issues likely to be raised in Beijing is Ukraine, where pro-Russian separatists and Ukrainian forces continue to fight. Ms. Merkel has been most active in trying to end the bloodshed, warning of further European sanctions if it does not stop. President Vladimir V. Putin of Russia was in China in May and reached what was billed as a landmark deal to sell Russian gas to the Chinese. The price has not been disclosed. German officials noted, however, that it will be at least a decade before deliveries reach capacity.
