Re <<dependency>>
Seems the lose-lose sanctions are working well to result in win-win outcome
The outcome was so mathematically obvious, never-mind intuitively manifest, and
am guessing gold shall benefit, along w/ eCNY and eRuble, together with CNOOC and such same
Team USA playbook is as confusing in the Ukraine fields as is puzzling in the trade arena
have been loving the payouts from CNOOC (one of the mega-cap unfortunate CPC China China China ADRs kicked off of NYSE - very anti-inflationary :0)
finance.yahoo.com
citing Message 34259501
Summers Warns US Is Getting ‘Lonely’ as Other Powers Band Together
... above from state-sponsored media,
... whereas below from behind NYT paywall (yes, the same lot that tells us a random 21-yrs nobody has top security files shared on minecraft discord where 12-yrs and under hang out Message 34259525
perhaps we are cretins, or they are morons, but unlikely both
In any case, trade wars and cold wars but less so hot wars are easy to win per equation of time dictated exercise of restraint is often sufficient as cretins busy themselves making 'uge mistakes
Perhaps should the Trump (definitely neither advocating nor hoping, as am agnostic) return to the scene he shall hire the right sorts to clean house and not be led down the primrose path again. Should he, the Trump, actually manage to make a comeback, best he remembers which of his two friends, one in Moscow and the other in Beijing, gave him a second chance to do it right, MAGA
As U.S. Tries to Isolate China, German Companies Move Closer
|  | As U.S. Tries to Isolate China, German Companies Move CloserSome are expanding in China, reluctant to leave a huge market they need to finance operations back home.
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As U.S. Tries to Isolate China, German Companies Move Closer
Some are expanding in China, reluctant to leave a huge market they need to finance operations back home.
April 12, 2023
The holding lot of the Shanghai Automotive Industrial Corporation-Volkswagen joint venture in Shanghai. Volkswagen has more than 40 plants in China.Qilai Shen for The New York Times
As Washington seeks to throttle economic ties with Beijing, two powerful engines of the German economy, Volkswagen and the chemical company BASF, are broadening their huge Chinese investments.
Volkswagen, which has more than 40 plants in China, announced a new effort to tailor models to Chinese customers’ wishes, with features like in-dash karaoke machines, and will invest billions in local partnerships and production sites. It’s part of a theme unveiled by the German automaker last year: “In China for China.”
BASF, with 30 production facilities in China, is pushing ahead with plans to spend 10 billion euros ($10.9 billion) on a new chemical production complex that would rival in size its massive headquarters complex in Ludwigshafen, which covers about four square miles.
Throughout Germany, executives are aware such investments run contrary to efforts by the United States to isolate China economically. They counter that revenue from China is essential for their businesses to thrive and grow in Europe.
Martin Brudermüller, BASF’s chief executive, said earnings from China allowed the company to effectively offset losses from Europe’s high energy costs andstringent environmental rules.
“Without the business in China, the necessary restructuring here would not be so possible,” Mr. Brudermüller told reporters at his company’s annual earnings conference in February. “Name me just one investment in Europe where we could make money.”
Executives at Volkswagen privately concede the automaker is in a similar quandary. High energy and labor costs have left the company heavily reliant on sales from China to help underwrite operations in Europe.
BASF, based in Ludwigshafen, Germany, plans to spend €10 billion on a new chemical production complex in China. Laetitia Vancon for The New York Times
Now ever-closer business ties are coming under scrutiny in Berlin. For months, at the urging of Chancellor Olaf Scholz, a policy proposal has been making the rounds of German ministries aiming to reset the country’s relationship with China, its largest trade partner. The aim is to strike a balance between diversifying Germany’s ties throughout Asia to avoid dependence on Chinese imports, while acknowledging the importance of doing business with China.
The Biden administration has pledged to make the United States more competitive with China by expanding American infrastructure and manufacturing, rather than negotiating new trade deals. German lawmakers and business leaders have made clear that their relationship with China is more nuanced: open to vigorous trade while trying to diversify into other Asian markets.
It is a policy being developed after a bruising year when Russia shut down natural gas shipments to Germany, a move that reminded lawmakers of the costs of relying on autocratic nations for materials essential to its industrial backbone. In the case of China, a big problem is Germany’s dependence on its imports.
Germany depends on China to provide essential technology products, including mobile phones and LEDs, as well as raw materials, including lithium and rare earth elements. These are critical to Germany’s plans to make a transition to cleaner energy and transportation.
Such a reliance must be carefully considered as Germany thinks strategically about its future dealings with China, said Katrin Kamin, a director of the Kiel Initiative in Geopolitics and Economics. Reducing its ties anytime soon is not a reasonable option.
“Germany will not be able to simply relax its relations with China in the short term,” Ms. Kamin said. “The dependencies are too great for that.”
“Without the business in China, the necessary restructuring here would not be so possible,” Martin Brudermüller, BASF’s chief executive, said at his company’s annual earnings conference.Ronald Wittek/EPA, via Shutterstock
The European Union has had a bumpier relationship with China. A breakthrough trade and investment deal between the bloc and China, a product of years of talks that was approved in 2020, was shelved less than a year later, after Beijing imposed sanctions on E.U. lawmakers for criticizing China’s treatment of its Uyghur population. The deal would have made it easier for companies to operate on one another’s territory.
Last week, Ursula von der Leyen, president of the European Commission, traveled to Beijing with President Emmanuel Macron of France as part of an effort to “rebalance” economic ties with China. She called for the revival of talks about trade, but pointed out stumbling blocks like the support China offers its domestic manufacturers and the restrictions it places on foreign companies.
“China is a crucial trade partner, but E.U. businesses face many discriminatory hurdles,” Ms. von der Leyen said after meetings with organizations in Beijing. “European companies have so much to offer China. But they need a level playing field to invest and provide their goods and services.”
She told reporters that the stalled trade deal was not discussed in talks with China’s leader, Xi Jinping, during the trip.
With foreign trade sales of €297.9 billion last year, China has been Germany’s biggest trading partner for seven years in a row. But Germany’s trade deficit with China has grown increasingly lopsided, a trend that worsened during the supply chain disruption caused by the coronavirus pandemic. Last year, imports from China expanded by a third, to €191 billion, while exports grew only 3 percent, to €107 billion.
German automakers sell roughly a third of all vehicles they produce in China, exceeding sales in all of Western Europe.Agence France-Presse — Getty Images
One area where Germany has long dominated ties with China is the automobile industry. German automakers, including BMW and Mercedes-Benz, sell roughly a third of all vehicles they produce in China — exceeding sales in all of Western Europe. But recent data shows that Germans appear to be losing their grip on the Chinese market, especially as the popularity of domestically produced electric vehicles surges.
Auto insurance registration records show that only 2.4 percent of all electric vehicles sold in China last year were made by Volkswagen, while BMW and Mercedes failed to crack even 1 percent, according to the German business daily Handelsblatt. By comparison, German brands continue to dominate the Chinese market for combustion engine vehicles, but their popularity is giving way to E.V.s.
Perhaps ominously, Chinese electric brands, such as BYD and Nio, are entering the German market, posing a threat to German automakers on their home territory.
In a clear sign of his priorities, within months of taking over as the chief executive of Volkswagen in September, Oliver Blume spent weeks touring China and returned vowing to strengthen his company’s partnerships there.
“We have to cooperate much more closely with our local partners in order to listen to the customers in the Chinese region,” Mr. Blume told reporters at the company’s annual earning meeting last month. “This will be part of a strategy for 2030.”
Ursula von der Leyen, president of the European Commission, and President Emmanuel Macron of France met with China’s leader, Xi Jinping, in Beijing last week.Pool photo by Ludovic Marin
study by the Kiel Institute showed that decoupling from China would be very costly for all of Europe, but especially Germany, given the strength of its economic ties. Calculations by the institute, based on gross domestic product from 2019, showed that Germany could lose income worth more than €131 billion. And it could be even more if China retaliated.Berlin would like to avoid another round of the upheaval it experienced after Russia launched its full-scale invasion of Ukraine, leading to an energy war that cost Germany its affordable supply of natural gas. That will mean continuing to balance economic interests with security concerns, Jörg Kukies, an economic adviser to Mr. Scholz, told a gathering of German and American trade leaders.
“We want to have a positive approach to China,” Mr. Kukies said. “Not an anti-China approach.”
Melissa Eddy
| | Melissa Eddy - The New York TimesMelissa Eddy is a correspondent based in Berlin who covers German politics, social issues and culture for The Ne...
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is a correspondent based in Berlin who covers German politics, social issues and culture. She came to Germany as a Fulbright scholar in 1996, and previously worked for The Associated Press in Frankfurt, Vienna and the Balkans. |
