Germany’s export-oriented foreign policy is being called into question
ANGELA MERKEL and Joe Biden will dine together in Washington on July 15 as Chancellor of the United States is almost certainly her last trip to America. The date commemorates the unique closeness of the two allies. It is the 75th anniversary of the arrival of the first in Bremerhaven MAINTENANCE Packages (Co-operative for American Remittances to Europe), food and aid packages that prevented starvation for many in war-torn Germany.
There will be a big heat demonstration between the lame Chancellor and the American President. Mr Biden is trying to improve relations with America’s closest allies after Donald Trump treated them with contempt. But being in love will have its limits: Germany and America are not geared towards Russia and China. “Russia is in the works between the two allies, but there is a big gap in the right strategy for China,” said Charles Kupchan of the Council on Foreign Relations, a think tank.
Despite the resentment at home, including within her own party, Merkel is sticking to her course in many of her relations with Moscow and most of her relations with Beijing. This has become an acute problem with Nord Stream 2, a $ 9.5 billion underwater pipeline heavily contested by the US Congress. The project is due to be completed in August.
“Nord Stream 2 is a heavy millstone around our necks that damages our credibility,” says Wolfgang Ischinger, former German ambassador to America. The pipeline canceled the credit Ms. Merkel obtained for getting other Europeans to impose sanctions on Russia after the annexation of Crimea in 2014. In May, Mr Biden tried to defuse the dispute by calling for sanctions against the company that built the pipeline and against Matthias Warnig, a former East German intelligence officer who is their boss. But he needs something in return as Congress is expected to call for new sanctions next month.
Mrs Merkel is expected to find a compromise so that Mr Biden can appease the congressmen. Germany could promise to shut down Nord Stream 2 gas if the Russians ever stop gas transit through Ukraine, which fears the loss of transit fees. It could strengthen Ukraine by helping it develop new sources of income and energy infrastructure. Finally, it could help fund the US-sponsored Three Seas Initiative, an effort to modernize infrastructure, including ports and pipelines, between 12 eastern European Union member states, necessary for the switch to liquefied natural gas from America or other suppliers .
Like her predecessor, Ms. Merkel tried to reconcile her loyalty to Germany’s allies with an attempt to deal economically with opponents. But while Willy Brandts Ostpolitik (Ostpolitik) was one of the most successful doctrines of the post-war years, Change through trade (Change through trade), the mantra for the past two decades, is a distortion of Ostpolitik, argues Hans Kundnani of Chatham House, a British think tank. Ostpolitik had at least reunification as a strategic goal: the idea of political change through trade is often little more than an excuse for closer trade relations with autocratic regimes. It’s one of the reasons others do EU The heads of state and government recently foiled Ms. Merkel’s move for the first time EU Summit with Vladimir Putin since the Russian President annexed Crimea.
Germany’s China policy was mainly influenced by Change through trade, funded in particular by the major automobile manufacturers, which are Germany’s most important industry. China has developed into Germany’s largest trading partner over the past ten years, with the commodity exchanges growing to USD 243 billion last year. And Volkswagen, Europe’s largest automobile manufacturer, now sells more than 40% of its cars in China (see graphics).
But the German enthusiasm for business in China has subsided. At the beginning of 2019 the BDI, Germany’s largest industry association, published a paper calling China a “systemic competitor” and expressing concerns about high barriers to entry, government subsidies for local businesses and other distortions in the Chinese market. Siegfried Russwurm, the BDIGermany’s boss recently said Germany needed “an honest discussion about how we deal with autocratic trading partners”. Human rights are not an internal issue, stressed Mr. Russwurm and described China’s treatment of the Uyghurs, a Muslim minority, as “unacceptable”.
The guidelines are also changing. A new law requires German companies with more than 3,000 employees to prove by 2023 that their supply chains are free from human rights violations (from 2024 it will apply to those with more than 1,000). The penalties for violations can be 2% of a company’s annual turnover.
Nevertheless, Ms. Merkel is sticking to her policy of treating China with kid gloves. It was unwilling to forbid Huawei, a Chinese company, to apply for contracts to build Germany’s fifth generation telecommunications networks, as America wanted. In the last days of the rotating German presidency of the EU Last December, it pushed through a contract that should give European companies better access to the Chinese market. This irritated the new Biden administration and was blocked by the EU Houses of Parliament. And in June, Ms. Merkel made comrades-in-arms G7 The heads of state and government are watering down the final communiqué of their summit in order not to anger China.
Will the successor to Ms. Merkel take a different course? Of the three people who are fighting for their successor after an election in September, two give the impression that they are not aware of the extent of the challenge posed by Russian and Chinese aggression, says Constanze Stelzenmüller of the Brookings Institution think tank. Armin Laschet, the Christian Democrat (CDU) Candidate, and Olaf Scholz of the Social Democrats argue weakly that America wants a “new cold war” and is trying to force the Europeans to “decouple” from China.
On the other hand, Annalena Baerbock, the candidate of the Greens, wants to stand up to Russia and China. But their chances are dwindling as the Greens received less than 20% of the vote in recent polls while the CDU and its allies hover 30%. As a potential junior partner, she would have some weight in China and Russia politics, but it’s hard to say how much; their priority would be climate change. That is why Mr Biden will listen to Mrs Merkel, even if she is on the way. Her successor will likely follow her faithfully. ■
This article appeared in the Europe section of the print edition under the heading “Goodbye, America!”