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The end of naivety: geopolitics into the German economy Opinion

The end of naivety: geopolitics into the German economy Opinion

China has been left without German anesthesia, resuscitation and ventilation systems company Heyel Medical AG. He was prevented by Berlin. The reason is the strategic nature of the German medical instrument manufacturer. The company founded in 1883 in Bad Ems was about to be sold to the Pekingese Aeonmed group. German law allows the government to veto the foreign purchase of a German firm in order to preserve public order or safety. The pandemic highlighted the demise of dependent non-European manufacturers. And now, after the war, Germany is questioning its presumptive naivety against the geopolitical dilemma that China represents. Politics or business? Berlin survives the world of open markets, seamless supply chains, production just in time timely and efficient division of labor. The German media even dismantled the thesis The end of the story and the last man by Francis Fukuyama (1992) who advocated the victory of liberal democracies against addiction and the end of bloody wars and revolutions after the end of the Cold War.

The dilemma of the German economy: giants like Volkswagen, Daimler and BMW depend on China. 40% of the business of Webasto, Munich’s car supplier, is based in the Asian giant. One in three Mercedes is sold in China. China is his second home. But Putin ‘s invasion has broken all schemes and exposed the dilemma of global dependence: supply chains are disrupted, key raw materials are missing, factories in Russia are closed. What would Germany do without China? Trumpf boss Nicola Leibinger-Kammüller points to an example: the semiconductor deficit. “Our engines are ready but we cannot deliver them because the integrated circuits (chips) for their regulation are lacking.” Half of the companies in the manufacturing sector acknowledge that they buy parts from China. not just cars or machines sold to China, but shares.The Chinese state-owned BAIC consortium is a major shareholder and the extremely wealthy Chinese businessman Li Shufu, owner of the Geely carmaker, owns a fifth At the same time, China’s rivals are overtaking Germany for global industrial leadership, while the economy relies on the Chinese market to guarantee jobs in Germany. VW boss Herbert Diess to decide on the group’s future on the Chinese market Money from China is intended to guarantee jobs at Wolfsburg (VW), Stuttgart (Daimler) and Munich (BMW) factories .

And now the question, according to Thomas Fromm, commentator for the Süddeutsche Zeitung, is the question: Who can we count and who cannot? What will be offered at home? Germany sees its social welfare model at risk due to globalization. Germany depends on the Chinese market, on which it sells luxury cars and high-tech machinery. Changes in international politics question this economic model, which simply means importing cheap energy from Russia and selling luxury to China. How much can Germany trust China to continue buying? The green president of the wealthy state of Baden – Württemberg, Winfried Kretschmann, says Russia’s energy dependence is a warning. He believes that the dissertation on democracy and freedom in the countries with which they trade was nothing more than an illusion. Now geopolitics will gain weight. That is the new key. Above all, for the rich exporting regions of southern Germany it will be crucial to look for alternatives. According to researcher Achim Wambach of the ZEW think tank in Mannheim, “China is a vital and fastest growing market, but dependence on that individual region must be avoided.” Wambach recommends that Germany reduce its economic dependence on the sectors. of automotive and machinery, which survives exports to China, and boosts other sectors.

How would the German economy work if China invaded Taiwan? Would you ignore it? What if the global energy revolution progresses in a world divided into newly formed geopolitical blocs. Germany without globalization is unimaginable. Its industry employers’ association, BDI, had already warned in 2021 that Germany’s strategy of “political (democratic) change thanks to business and trade” had reached the limit. Since then China has not changed at all. It is a systematic competitor of liberal societies.

Berlin also believes that dependence on key economic sectors needs to be reduced. His recommendations: look at India, rethink global supply chains, and recycle important raw materials. Franziska Brantner, MP for the Greens and parliamentary secretary at the Ministry of Economy, believes that strategic sectors should be protected. “We note with concern that the Communist Party of China has a plan for the products it wants to manufacture itself so that they do not rely on imports and the deadlines to achieve that goal. In the meantime they buy companies that have patents and technologies that do not. German companies know this, but we need a socio-political debate to decide how we protect our economy. ”

Another risk, according to Wambach, is the immediate consequences of energy dependence and the disconnection of the EU from Russia’s fossil fuels. “The energy revolution, which is already challenging the German economy, started on the assumption that gas, as a transitional technology, was cheap. But rising prices will put more pressure on companies to adapt now. ” The coming weeks will be crucial in mitigating the impact of a planned post – summer embargo on Russian gas. Researchers from the Ifo Institute recommend ratification of the trade agreement with Mercosur and updating of the agreement with Mexico. But the risks are huge. China is an important supplier of the elements made by the Rare Earths that need electricity. It is also crucial in the production of wind turbines, solar cells or semiconductors. Many of the phosphates for fertilizers consumed in the EU come from China. 19 out of 30 topics considered critical come from global monopolies. Without TSMC (Taiwan – based), the world’s third largest chip maker, nothing moves in Ingolstadt (Audi), Stuttgart (Mercedes) or Munich (BMW).

On its website, Chinese Aeonmed emphasizes the importance of buying Heyers in order to achieve its global leadership in medical technologies. In 2016 China successfully seized the German Kuka robot. While Berlin tried to prevent the Chinese landing of Midea and Economy Minister Sigmar Gabriel at the time called for another European offer, Kuka, one of the crown jewels of German robotics, fell into the hands of a consortium Chinese Midea. Berlin has learned blows, Corona and now Putin.

count lydia he is a German political analyst

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