Merkel focuses on trade at start of talks in Beijing

The German chancellor hopes for a resolution to US-China trade war and says Germany is open to Chinese investment.

Angela Merkel and Xi Jinping
German Chancellor Merkel, the first Western leader to visit China since unrest broke out in Hong Kong, has been urged by protesters to bring up the issue in her meeting with Chinese President Jinping [File: Jason Lee/Reuters]

German Chancellor Angela Merkel said on Friday that trade problems between China and the United States affect the whole world and that she hopes they will be resolved soon.

Merkel made the remarks at the start of formal talks with Chinese Premier Li Keqiang at Beijing’s Great Hall of the People during a two-day trip to China. She will attend a dinner with Chinese President Xi Jinping on Friday evening.

“We hope that there will be a solution in the trade dispute with the US since it affects everybody” in the world, Merkel told Li.

Merkel also said that Germany is open for Chinese investment and welcomed all Chinese companies to invest in the country.

She added, however, that Germany checks investments in certain strategic sectors and critical infrastructure.

Meanwhile, Li said that China hopes Germany will accept more Chinese companies and loosen export rules for certain goods. He also said China will open up its economy even more.

Germany’s economy contracted in the second quarter due to weaker exports, with economists saying it is facing a recession as German firms are caught in the crossfire of the US-China trade war.

While US President Donald Trump has pressed American companies to look at ways to close their Chinese operations and make more of their products at home, Merkel wants to start a new phase in the European Union‘s relations with China.

Merkel has pushed for a European investment deal with Beijing, even as Washington has resorted to waves of tariffs to counter what it says are China’s unfair trade practices. The US’s European allies, including Germany, largely share its criticisms of China, but not Trump’s choice of tariffs to resolve the issues.

Germany, which traded almost 100 billion euros ($111bn) in goods with China in the first half of 2019, holds the rotating EU presidency in 2020, when Merkel is planning an EU-China summit with a view to achieving a common European stance towards the world’s second-largest economy.

The summit would aim to counter what Berlin sees as China’s divide-and-rule approach to dealing with the European bloc, as Beijing promotes global infrastructure projects under its Belt and Road development initiative, which has made it an influential player in poorer eastern EU countries such as Hungary and Greece.

Ahead of her departure for China, prominent Hong Kong activists wrote to the chancellor, urging her to be guided by her memories of life in dictatorial East Germany and to be on her guard in her talks and business dealings with Beijing.

Hong Kong leader Carrie Lam on Wednesday withdrew an extradition bill that triggered months of often violent protests so the Chinese-ruled city can move forward, but some said the move was not enough.

Source: News Agencies