Sino-German cooperation benefits all with win-win prospects

BEIJING, Nov. 1 (Xinhua) -- German Chancellor Olaf Scholz will pay an official visit to China on Friday, as the first European Union (EU) leader to come to Beijing after the successful convening of the 20th National Congress of the Communist Party of China.

China and Germany, both countries with important influence, are major trading partners. A high degree of economic complementarity has presented huge potential for cooperation, which is not only beneficial for the two countries, but also significant for the prosperity of the region and beyond.

This photo taken on May 21, 2018 shows a cross-border e-commerce freight train from Hamburg of Germany arriving in Xi'an, Northwest China's Shaanxi Province. (Photo: Xinhua)

Booming trade

The China-Europe freight train service offers a snapshot of how trade between China and Germany is flourishing.

On September 9, the 10,000th fully loaded China-Europe freight train in 2022 arrived at Hamburg, a port city in northern Germany, from Xi'an International Port, northwest China.

The 10,000th China-Europe freight train in 2022 "is an important milestone for China's cooperation with Hamburg, Germany and Europe," said Wang Wei, deputy consul general of the People's Republic of China in Hamburg.

"The high-capacity connections of the China-Europe goods trains have greatly helped foreign trade in reducing costs and increasing efficiency, and effectively promoted economic development along the route," Wang said.

China remains the top trading partner of Germany's largest universal port Hamburg, said Port of Hamburg Marketing (HHM), adding that besides sea transport, containers are also being transported in increasing numbers by rail between China's cities and Hamburg.

"For time-sensitive freight, the container train services therefore provide an attractive alternative for transport" between Hamburg and Chinese cities, said Axel Mattern, HHM's chief executive officer (CEO).

With 82 routes, the trains reach 200 cities in 24 European countries, forming a transport network covering the whole of Europe. The trains transport more than 50,000 types of goods across 53 categories, such as automobiles and parts, clothing and accessories, and grain and timber.

Germany is one of China's most important trading partners in Europe, and China has been Germany's top trade partner for six consecutive years. The trade volume between them has mushroomed to more than $250 billion in 2021 from less than 300 million dollars at the very beginning of diplomatic relations.

This photo taken on July 11, 2022 shows a scene from the welcome ceremony for the 10,000th trip made by China-Europe freight trains operated by the China-Europe Railway Express (Chongqing) in Duisburg, Germany. (Photo: Xinhua)

Broader market opportunities

Immense potential remains for China and Germany to enrich their relations and deepen their mutually beneficial cooperation regarding climate change, macroeconomic policy, environmental protection, services trade, AI and digitalization.

China has been speeding up efforts to foster a new development paradigm, which means broader market opportunities for countries like Germany. In the meantime, Germany, as a leader in technological innovation, continues to exert a pull on Chinese enterprises.

In the first nine months of this year, foreign direct investment into the Chinese mainland expanded 15.6 percent year on year to 1.00376 trillion yuan. In U.S. dollar terms, the inflow went up 18.9 percent year on year to 155.3 billion dollars, data from China's Ministry of Commerce showed.

Among all sources, investment from Germany showed the strongest growth, jumping by 114.3 percent, according to the ministry.

In September, German chemicals giant BASF inaugurated the first plant of its new Verbund site in Zhanjiang City, south China's Guangdong Province.

The company said it will produce 60,000 metric tons of engineering plastics annually, to be used in particular by China's car and electronics industries.

Between January and September this year, BASF's sales in China rose 5.8 percent year-on-year to 9.2 billion euros ($9.2 billion).

"We benefit from China's policies of widening market access," BASF CEO Martin Brudermueller said at the inauguration ceremony in Zhanjiang. "Overall, we came to the conclusion that it is advantageous to expand our involvement" in China.

This aerial photo taken on February 27, 2022 shows a view of BASF Zhanjiang Verbund site which is under construction in Zhanjiang, South China's Guangdong Province. (Photo: Xinhua)

Germany, a powerhouse in the car-producing industry, has been attracting an increasing number of Chinese auto-makers.

Ferdinand Dudenhoeffer, director of the CAR Center Automotive Research Duisburg, told Xinhua that key battery manufacturers in China are now building battery cell factories with large investments in Germany.
China's carmakers like NIO and BYD have brought their products and services to Europe, Dudenhoeffer said.

"Both China and Germany are leading car-producing countries and have developed complementary advantages in automobile technology and the market," Xiong Meng, an official of the China Federation of Industrial Economics, said at the Sino-German Forum on the Development of the NEV Industry in September.

"Cooperation in the automobile industry between the two countries has been carried out in multiple fields and achieved remarkable results," said Xiong.

Visitors are seen at the booth of BYD during the 67th IAA Commercial Vehicles in Hanover, Germany, on September 20, 2018. (Photo: Xinhua)

Win-win goal

With the world economy in the doldrums, staying open and engaged in cooperation and fostering economic and trade ties are good not only for the two countries, but also for the world.

This year marks the 50th anniversary of diplomatic relations between China and Germany. Past achievements have laid a solid foundation for the steady development of China-Germany ties, which have shown great vitality, endurance, resilience and potential, experts have said.

As Germany is a pivotal country in the EU, the continent's prosperity is closely associated with Germany, and thus deepening China-Germany and China-EU cooperation will serve the interests of both sides and beyond.
Scholz recently said that he supports globalization, adding that decoupling is the "wrong answer" and that Germany must do business with the rest of the world, including China.

Executive Vice-President of the European Commission Valdis Dombrovskis, who is in charge of economic affairs, also reportedly said he believed that decoupling from China is not an option for EU companies, and that "the EU should continue engaging with China with pragmatism."

"We commend these remarks from the European leaders," Chinese Foreign Ministry spokesperson Mao Ning told a daily news briefing, adding that China also supports globalization and opposes decoupling.
In 2021, China-EU trade volume exceeded 800 billion dollars for the first time and two-way investment went beyond 270 billion dollars in cumulative terms, Mao said.

Noting that China-Europe cooperation is deeply rooted in solid public support, extensive common interests and similar strategic needs, Mao said that such cooperation enjoys great resilience and potential.

"China is ready to work with Europe to jointly work for greater progress in bilateral cooperation in various areas and deliver more benefits to the two peoples," Mao said.