Germany and the Silk Roads – Chinese Imperialism, or German Protectionism?


 

The Silk Roads are returning. China’s largest and most ambitious international economic plan, the “One Belt One Road Initiative” (yidaiyilu) will see its influence tangibly spread over Asia, Africa and Europe. With newly planned trade corridors over much of the world, a vast number of countries will be affected by the initiative. Included in that number is Germany. The question arises: how will “One Belt One Road” affect the country?

The “One Belt One Road” initiative has not appeared over-night. Xi Jinping first announced his masterwork in September 2013[1] and has since then developed into an extremely ambitious vision. The Chinese leader pictures a better connected world, held together by free trade and global cooperation. The proposed maritime ‘road’ leads over South-east Asia to Africa, where China has been carrying out major infrastructure projects already for a number of years. The ‘belt’ stretches across Central Asia and all the way to Western Europe[2].

“Inclusiveness” (baorongxing) is the central word to Xi’s rhetoric for the project. For many outside of China, this standpoint seems uncharacteristic of a country renowned for its history of closed borders and secrecy but China has been gradually opening up business since the start of economic reforms in the late 70s. China is now not only more open economically, but also confident in its business know-how. The “One Belt One Road” initiative signals China’s desire – and capability – to join the major players of the world economy.

A number of German media outlets are already expressing their fears over the new silk roads. Wary Critics point to China’s track record for promoting their own form of ‘illiberal free trade’ at ends with the western model of international trade, expecting its development to be damaging to German companies. The Brics states are portrayed as an enemy of a more just existing western system, with China at the centre of the trouble[3]. The closeness of Putin to the Chinese leadership and his willingness to be part of the project scares the German media further. [4] There is concern for China’s apparent desire to make economic in-roads into the Eurasian region on their own conditions.[5] This behaviour is generally known as making trade agreements, and both Europe and America are quite used to doing it themselves.

Any bilateral agreement does of course have political implications, but Germany’s fear of working with China on predominantly Chinese terms is telling of previous agreements where Europe has been the instigator of negotiations. More justified would be a view of caution towards the kind of company, rather than Chinese FDI in general.  Up to now mainly only state-owned companies have been involved in the initiative.[6] That could potentially lead to more Chinese political influence internationally in trade compared to Chinese private companies.

Some German companies are however openly enthusiastic, with eyes fixed solidly on new business opportunities. Duisburger Hafen in Nordrhein-Westfalen already considers itself a central point for trade relations not just between China and Germany, but also Europe. In October 2016 the port claimed that “when you are in Duisburg, you are in Europe”[7], as part of an announcement regarding expanding its China business. Duisport already cooperates with Urumqi, Far-western China’s trade powerhouse; a city central to the new Silk Road’s expansion due to its strong position in central Asia.

Some Chinese groups are meanwhile not entirely satisfied with current Sino-German trade relations. The China International Investment Promotion Agency, accused Germany of protectionism directed at China after changes in Germany’s regulation of foreign trade[8] but as both countries are members of the WTO, it seems unlikely that Germany actually is able to target China unilaterally with trade restrictions. It is however important that Germany is the one being criticised for poor international trade practice. The standpoint also parrots Xi Jinping’s ‘Inclusiveness’ rhetoric.

Germany does not appreciate the very general sounding rhetoric China prefers to use when it talks about official plans. Just like the extremely vague (and clearly related) Chinese Dream (zhongguomeng) back home in China, there is no exact, set in stone plan for the new Silk Roads. Instead China offers a lofty dream with networks of possible trade corridors on maps with a mysterious lack of national borders. Daniel Müller from the Ostasiatischen Verein believes that the new Silk Road is more of a conglomerate of many individual initiatives rather than one unified grand plan.[9] From the Chinese perspective, this pragmatic approach is perfectly normal; indeed it is part of modern Chinese culture. For Germany however, the uncertainty raises concern further.

Much of the misunderstanding between Germany and China stems from differences in political and business culture. Germany favours clear, objectively measurable plans. China on the other hand prefers big ideas resolved with pragmatism. Deng Xiaoping’s infamous pragmatism brushed off on the nation, and has remained the culture ever since. As the new Silk Roads progress,  what Germany is likely to find even more challenging than China’s apparent lack of clear planning Is the country’s special brand of pragmatism, with force.

German critics’ fears of the “One Belt One Road” Initiative are focussed on the wrong concerns. The massive infrastructure project will not necessarily be bad for Germany and its businesses, but will change political and economic relations in ways  which as of yet  are hard to predict. What is certain: the “One Belt One Road” initiative will change global relations massively.

Written by Timothy Van Gardingen,  Student of German and Chinese at the University of Leeds, on 25th October 2017. 

I am currently writing my dissertation on the relationship between Germany and ‘One Belt, One Road’. I would be grateful for any commentary and criticisms from any experts who happen to stumble across my article. As of yet, there is very little scholarship on the topic, and any pointers will be greatly appreciated.

[1] SCIO. 2016.  哈萨克斯坦:“一带一路”从这里走向世界. http://www.scio.gov.cn. Retrieved on 24/10/2017

[2] Telepolis.  2017. China: Der Traum von einer neuen Seidenstrasse

[3] Zeit Online. 2017. Chinas Traum einer neuen Seidenstrasse

[4] Zeit Online. 2017. Chinas Traum einer neuen Seidenstrasse

[5] Zeit Online 2017. Chinas Traum einer neuen Siedenstrasse

 

[6] DW. 2017. Die deutsche Sicht auf Chinas Seidenstraße

[7]“Duisburger Hafen. 2016. Duisport is expanding its China Business „when you are in Duisburg, you are in Europe” retrieved from presse.duisport.de. 25/10/2017

[8]China International Investment Promotion Agency (Germany). 2017. Kommentar zur Änderung der Außenwirtschaftsverordnung durch die Bundesregierung. www.ma-dialogue.de. Retrieved 24/10/2017

[9] DW. 2017. Die deutsche Sicht auf Chinas Seidenstraße