Germany’s Faustian entanglement with China

Excerpt

Back in November, German Chancellor Olaf Scholz met with Chinese Communist Party (CCP) chairman Xi Jinping. His visit to China was the first by a G7 leader in three years. Facing heated domestic and international pushback, Scholz framed his visit as an effort to “further develop” economic cooperation between Berlin and Beijing. In this context, such “further development” means further cementing Germany’s Faustian bargain with China, one in which European-based players, like Airbus and Volkswagen, claim immediate revenue — but at their long-term expense and at great strategic cost.

For China, Chancellor Scholz’s visit constituted an opportunity to drive a wedge between the US and Europe by taking advantage of Europe’s current, Russia-imposed economic squeeze and leveraging Beijing’s market as bait. Scholz jumped at the bait despite two decades of precedent showing that Beijing’s promises of market access only ever pan out for China’s champions. In the end, Western companies receive, at best, a few years of profit in exchange for technology transfer, intellectual property theft, industrial dependence, and, ultimately, losing out to Chinese champions.