Dependency trap – economy: China now warns Germany

“In this sense, both sides must be wary of the rise of protectionism,” he continued. According to him, Berlin and Beijing should also objectively look at the issues of production capacity from the perspective of economic laws. Since the German government presented its China Strategy 2023, the aim has been to reduce dependence on the world’s second largest economy in critical economic areas and thus also reduce the risk for Germany.

Xi now responded that cooperation between Germany and China does not entail any risk, but is “a guarantee for the stability of relations.” The Chinese cited sectors such as mechanical engineering and the automotive industry as examples, which have traditionally been strongly represented in China.

China is hurting markets
The recent focus has been on the accusation that China uses state investments to ensure that Chinese companies overproduce and damage other markets with their cheap goods. Examples include electric cars, which the EU is investigating for anti-subsidy reasons, or the solar energy industry. Swiss-based solar manufacturer Meyer Burger recently closed its location in Freiberg, Germany, citing cheap solar cells from China. However, Beijing sees it differently: China’s exports of electric vehicles, lithium batteries and photovoltaic products have enriched global supply and contributed to the global response to climate change, Xi said, according to Chinese information.