Vice Chancellor in China, Germany condemns Chinese activities in the South China Sea and more
Welcome to this weeks edition of the Germany in Asia newsletter! Where we provide you with a brief overview of the most important stories of the week.
Top Story
China and EU to Negotiate Electric Vehicle Tariffs Amid Diplomatic Tensions
During his trip to China, German Economy Minister Robert Habeck confronted criticism from Chinese officials regarding the EU's plans to impose tariffs on electric vehicles (EVs) imported from China. The dispute revolves around allegations that Chinese state subsidies provide unfair advantages to their EV manufacturers. Habeck, advocating for dialogue and compromise, informed EU Commission Vice President Valdis Dombrovskis of his discussions in Beijing prior to Wang Wentao and Dombrovskis agreeing to initiate negotiations.
Habeck acknowledged the complexity of the issue, describing the talks as a positive step forward despite China's initial resistance. He countered Chinese assertions that EU tariffs aimed to stifle China's industrial progress, emphasizing the EU's stance on fair competition. Discussions during Habeck's visit explored potential compromises, including adjusting tariff levels or implementing quotas on Chinese EV imports to Europe.
The looming tariffs, scheduled for July 4 unless negotiations alter their course, underscore a pivotal moment in EU-China relations. While France supports the tariffs, Germany faces opposition alongside the Netherlands and Hungary within the EU. Concurrently, China launched an anti-dumping probe into EU pork imports, signaling retaliatory measures amid escalating trade tensions. The outcome of negotiations could significantly impact future trade dynamics between the EU and China, highlighting the strategic importance of resolving trade disputes while maintaining economic cooperation.
Source: Handelsblatt
Government
German Vice Chancellor Robert Habeck Embarks on Diplomatic Mission to South Korea and China, Focused on Economic Cooperation and Climate Initiatives
German Vice Chancellor and Minister for Economic Affairs and Climate Action, Robert Habeck, embarks today on a five-day journey to South Korea (Seoul) and China (Beijing, Shanghai, Hangzhou). His agenda includes meetings with government officials from both countries, EU representatives, and German and European businesses operating locally. Minister Habeck emphasizes the broad and diversified interests in the region, aiming to deepen economic cooperation, climate initiatives, and explore new potentials.
In South Korea, discussions will focus on enhancing economic and trade relations, particularly in high-tech sectors, as well as geopolitical dynamics in East Asia. The visit includes a visit to the Demilitarized Zone between South and North Korea.
Moving to China, Minister Habeck will engage in talks with key officials in Beijing, including the Chairman of the National Development and Reform Commission (NDRC) and the Ministers of Commerce and Industry. Topics will span bilateral relations, economic policies, energy, and climate issues. He will also co-chair the first plenary session of the German-Chinese Climate and Transformation Dialogue, emphasizing ambitious climate policies.
In Shanghai, Habeck will participate in the 30th anniversary celebration of the local German Chamber of Commerce and visit a research center of a German company. In Hangzhou, he plans to address students at Zhejiang University on climate change and climate protection.
Accompanying Minister Habeck is a delegation focused on medium-sized enterprises across various sectors, highlighting Germany's strategic interests in healthcare technology, automotive, metallurgy, climate technology, and IT.
Bilateral Economic Relations with Both Countries
South Korea: South Korea stands as Germany's second most significant export market in Asia, with goods exports totaling around 20 billion euros. The bilateral trade volume (sum of imports and exports) reached nearly 34 billion euros last year.
China: China remains a crucial market for German companies, serving both as a major sales destination and a key source of imports. The bilateral trade volume (sum of imports and exports) amounted to 254 billion euros last year, constituting one-twelfth of Germany's total merchandise trade. Imports from China totaled 157 billion euros, significantly surpassing exports to China, which amounted to 97 billion euros.
Source: Ministry for Economic Affairs
Germany Condemns Chinese Aggression in South China Sea, Calls for Adherence to International Law
A German Foreign Office spokesperson expressed deep concern over recent incidents between Chinese and Philippine units in the South China Sea. Reports, images, and videos show that Philippine boats on a legal supply mission were blocked, rammed, and violently boarded by Chinese ships, resulting in injuries to several Filipino sailors. The incident occurred near the Second Thomas Shoal, within the Philippine Exclusive Economic Zone as per the 2016 UNCLOS ruling.
The spokesperson condemned the "dangerous and irresponsible maneuvers" by China, which violate UNCLOS and escalate tensions. Germany, alongside international partners, will continue advocating for the enforcement of UNCLOS, freedom of navigation, peaceful dispute resolution, and regional stability.
China claims extensive areas of the South China Sea, including island formations, and asserts "archipelagic rights" over distant islands without legal basis. The country's aggressive actions, including creating artificial islands and increasing military presence, have led to repeated confrontations with neighboring countries. Recent escalations include the use of lasers and water cannons against Philippine ships, with the latest incident marking a new level of aggression.
Source: Auswärtiges Amt
German GIZ Project Enhances Vocational Training in Pakistan, Supporting Employment in Growth Sectors
A project by the German Society for International Cooperation (GIZ), funded by the Federal Ministry for Economic Cooperation and Development (BMZ), aims to support Pakistan's vocational education sector to help graduates and job seekers find employment in growth industries. According to a government response to a small inquiry from the AfD faction, the project has established an information system to analyze growth factors and develop training courses. In Khyber Pakhtunkhwa, a Quality Management Unit for vocational training has been set up to facilitate cost-effective training for vocational school staff. The project has trained 25 master trainers and developed training packages for returning Pakistanis from abroad, reaching 1,500 returnees. Among the project's 28 employees, five are women. An initial progress report was submitted to the BMZ after twelve months, and the implementation was deemed successful. Evaluation reports are available in the GIZ database.
Source: GIZ
Parlament
Afghanistan Inquiry Reveals Misjudgments and Delays in Evacuation Procedures by German Authorities
The 1st Afghanistan Inquiry Committee questioned a former department head at the Federal Ministry of the Interior (BMI) and a group leader at the Federal Chancellery (BKAmt) about the evacuation of local Afghan staff and the Federal Intelligence Service's (BND) misjudgments.
Dagmar Busch, the former BMI department head, testified that the Ministry of Defense wanted to expand the eligibility for the local staff evacuation procedure (OKV) to include employees since 2013, not just since 2019. The BMI initially rejected this, but later conceded after then-Chancellor Angela Merkel supported the expansion. Busch also explained that the BMI rejected the Foreign Office's request for a "Visa on arrival" (VOA) procedure, only adopting it on August 15, the day Kabul fell to the Taliban, as a last resort.
Busch criticized the BND's misjudgment of the situation, which led all departments to believe they had until at least September 11 to evacuate local staff. The BKAmt group leader confirmed the BND's error and initiated an error analysis, noting that all international partners had also been mistaken.
Source: Bundestag
German Government Faces Scrutiny Over Alleged Fraudulent CO2 Projects in China
The CDU/CSU parliamentary group has raised a query (20/11870) about fraudulent CO2 projects, known as Upstream Emission Reduction (UER) projects, conducted by German oil companies in China, worth approximately 1.7 billion euros. Investigations by the ZDF program "Frontal" revealed that German certifying bodies had certified non-existent projects in China, approved by the Federal Environment Agency (UBA). The parliamentarians are asking the government when the UBA President, the responsible UBA department, and the relevant section of the Federal Ministry for the Environment (BMUV) first became aware of these potential fraud cases and what measures were taken subsequently.
Recommendations
„Jammu & Kashmir’s Changing Electoral Dynamics in 2024” in South Asian Voices
„The Credibility Trap. Is Reputation Worth Fighting For?” in Foreign Affairs
„Western Protectionism Needs an End Date” in Foreign Policy
„Convergence in Vietnam, EU Interests a Harbinger of Indo-Pacific Order?” - Institute for Security and Development Policy
Events:
The 1st Afghanistan Inquiry Committee will hold a public hearing on Thursday, June 27, 2024, at 12:00 PM in the Paul-Löbe-Haus, Europasaal 4.900
25.06 - 16:30 - India’s Strategy in Myanmar - Stimson Center
Thank you for reading! See you next week.