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Shifting Politics: The Future of Germany’s China Policy

Analysis - 7 April 2022

Germany’s China policy is at sea, drifting without an anchor. In the past, it was underpinned by a clear selection of people, principles, and policies. Driven by the Merkel Chancellery, under the guiding principle of Wandel durch Handel (change through trade), Germany pursued a transparent policy of engagement in the hopes of influencing China to become more liberal and democratic. 

But this constellation has ended, or rather, it has failed. Over the course of Angela Merkel’s 16-year tenure, China has changed. This change has, however, been for the worse, not the better. Beijing has become both more authoritarian domestically and antagonistic internationally. Despite this shift, Berlin was incapable of departing from its political course. Doing so would have openly admitted failure of a long-standing policy.
The inauguration of the new German government has offered a necessary break. Former advisors and ministers in Merkel’s cabinet have grasped this as an opportunity to distance themselves from past policies. So too did Angela Merkel herself, to some degree, when she acknowledged that Germany may have been "too naive in our approach to some cooperation partnerships".

Now, German China policy is at an inflection point. This year, the new traffic light coalition will draft Germany’s first-ever China strategy. But which strategic direction will it follow? 

There are three broad dynamics amongst stakeholders that will determine Germany’s China policy. These three principles, and the answers the German government will give to fundamental questions on the world order, will influence and determine the shape of Sino-German relations. 

With regards to determining actors, three dynamics are at play: 

  • Internal party dynamics, particularly among the Social Democrats, where a more vocal faction of China critics has emerged in the parliamentary group. 
  • Coalitional dynamics between the Greens, Free Democrats (FDP) and Social Democrats (SPD), with the former two being more critical of China than the latter.
  • The dynamics of both the domestic and foreign environment, which will be shaped by public opinion, business and civil society (mutually divided about how to approach China), Germany’s European partners and allies, as well as China’s own behavior.

Within this myriad constellation of forces, three broad principles can be discerned. 

First, the policy of pure engagement, encapsulated by Wandel durch Handel. Second, an opposing policy of diplomacy and deterrence, articulated by Green Foreign Minister Annalena Baerbock during the election campaign with the principle of Dialog und Härte (dialogue and toughness). And third, the EU’s triangular strategy of labeling China a partner, competitor, and systemic rival; a principle which acts as a compromising catch-all phrase in the German government parties coalition treaty. 

It remains to be seen which strategic direction and political line will prevail. What we are witnessing today is a tug of war between the adherents of a largely engagement-centered strategy, and those who favor diplomacy and deterrence.

With the end of the Merkel era, political momentum favored a more critical China policy. Over time, the general mood in Germany towards China had become more unfavorable: business representatives have been more vocal in their criticism, and the Greens and the Free Democrats -parties with a tougher stance towards Beijing - have entered the government.

Russia’s invasion of Ukraine has been a watershed moment in Sino-German relations.

But events have stalled this momentum. Russia’s invasion of Ukraine has been a watershed moment in Sino-German relations. Chancellor Scholz spoke in the Bundestag of a Zeitenwende, a historical turning point. This has led Germany to cast aside long-established policies. Berlin is now sending weapons to Ukraine, has proposed a 100 billion modernization fund for the armed forces, agreed to meet NATO’s two per cent GDP target of defense spending, and has put in place a never-before-seen sanctions regime against Russia. 

Paradoxically, this Zeitenwende has not had any significant consequences for Germany’s China policy to date. It appears as though Berlin’s shifting political approach towards Russia has been so demanding and arduous, that a decision has been taken to contain the change, and not let it affect German foreign policy at large. 

Instead of drawing strategic lessons from Russia for its China policy, the opposite has happened. Political and business establishments in Germany are favoring a largely engagement-centered strategy towards Beijing, and have used this situation to strengthen their case. The leader of the SPD parliamentary group, Rolf Mützenich, has argued that "just because the project ‘change through trade’ failed in Putin’s case, it doesn’t have to with regards to Beijing". He has been joined by business leaders, who argue that Russia and China are not comparable, and in the context of Russia’s war in Ukraine, have decided to double-down on China as an investment destination.

The former German navy chief, Vice Admiral Schönbach, argued that Germany needed Russia to counter China. Now there is a camp that believes that Germany needs China to counter Russia. There seems to be no majority supporting the position that Germany should align with like-minded countries to counter both China and Russia.

This highlights that Germany is largely treating Russia and China as separate cases, rather than looking at them jointly through the overarching prism of a changing international system. This could, however, be a mistake. 

Beijing and Moscow are both revisionist, not status-quo, powers. The Sino-Russian pact signed on 4 February 2022 is a declaration to counter the United States and NATO, with the aim of changing the existing world order. It signals the intention to reorder power in the world and fight over topological spaces: the spatial orders of the earth, in the digital realm, as well as in space. But in Germany, parts of the political establishment are not judging China by its words or the nature of its system, but rather by its overt actions vis-à-vis Russia.

Germany is largely treating Russia and China as separate cases, rather than looking at them jointly through the overarching prism of a changing international system.

So far, Beijing knows better than to support Russia too overtly with concrete measures. It is likely to try and remain in a gray zone that allows it to support Putin, but not to the detriment of its relations with the West. 

Beijing’s gray zone geopolitics are being underestimated. Already, Germany is finding it difficult to look at the world through a purely geopolitical lens. In a recent German TV appearance, Chancellor Scholz stated that "what really scared [him] is this incredible emphasis on geopolitics in the thinking of the Russian president".

There should be no illusion that this emphasis on geopolitics is not also integral to the thinking of the Chinese president.

In this context, before devising a China strategy, Berlin should find answers to a number of fundamental questions: What world are we living in? What is the geopolitical nature of the 21st century? And what strategic consequences do we need to draw from Russia’s war in Ukraine? Then, it should ask itself how China would answer these questions. 

The formulation of a first-ever German National Security Strategy, which will precede the China strategy, should provide an opportunity to ask those questions and arrive at a common analysis. Ideally, it should form the basis on which the specifics of Germany’s new strategy towards China should coalesce.

For now, Germany’s policy towards China remains rudderless on uncharted waters. The coming months will shape its contours as different actors with different agendas vie to become determinants. Whether this strategy will have a strong foundation with the necessary analytical underpinnings will depend on how Berlin sees the development of the world order, and how this is reflected in its national security strategy.


The views expressed in this article are those of the author alone. 

 

Copyright: JOHANNES EISELE / AFP

 

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