The traffic light is on fire again. It’s about China, it’s about Hamburg, and this time the Chancellor can no longer play the kind referee. Olaf Scholz is in the middle of a major conflict. He’s in the China dilemma.
The planned entry of a Chinese group at a Hamburg container terminal is becoming more and more a topic of dispute in the coalition: Greens and FDP criticize the project.
It’s not just a dispute about the port of Hamburg. It’s not just a question of whether the Chinese are allowed to participate in “critical infrastructure” in Germany. It’s also a big question of power. For the first time, the Chancellor himself is at the center of a coalition dispute. This can be dangerous in many ways.
The most recent coalition crash took place between Christian Lindner and Robert Habeck. The chancellor could dissolve it by policy decision. Now the situation is different. It is not two of his ministers who are Olaf Scholz’s problem, it is the Chancellor himself who is the problem.
The framework in which this coalition conflict is taking place is also fraught with problems. Because it is the domestic political core of a foreign and trade policy conflict that could hardly be bigger. After all, he touches on Germany’s self-image because he questions the Federal Republic’s model of prosperity.
In short, it’s about: Is Germany going for “business as usual” as the most successful European trading nation, i.e. “business first”? Or is Germany guided by geostrategic considerations, i.e.: “Politics first”? The business first principle involves major political risks, while the politics first principle involves major economic risks. For Scholz this means: He is in a China dilemma.
The Green Foreign Minister Annalena Baerbock publicly warns against “business first”. Baerbock’s party colleague Toni Hofreiter warns against making the same mistakes in China as in Russia. The Green Economics Minister Robert Habeck wants to stop China in Hamburg.
FDP fighter Marie-Agnes Strack-Zimmermann wants Scholz to stop making “males” in front of potentates. FDP faction leader Dürr has already found a new formula for Germany: trade without making yourself open to blackmail. As if this were that easy. A chair leg in a murderer’s hand is still a chair leg, but more of a weapon.
It is to be expected that the two heads of the secret service – from the Federal Intelligence Service and the Federal Office for the Protection of the Constitution – publicly warned against port trade with China: “Security” is their job. But security is an eminently important, but also just one aspect of this topic.
In any case: This dilemma is far greater than Scholz’s Hamburg past, which is now gladly pointed out. Certainly, Scholz was Hamburg’s mayor for years. It goes without saying that he knows all the players on site. And of course he has a close relationship with his successor Peter Tschentscher, whom he chose himself.
And in fact everything has something to do with the SPD and their worldview, more precisely: their idea of trade relations and the role of politics in them. The fact that a mayor does everything to help his port fits conceptually seamlessly into Olaf Scholz’s industrial policy ideas for the Russian pipeline Nord Stream 2.
Scholz had already ignored the geostrategic aspects at Nord Stream – the potential for blackmail of the gas pipeline against Germany – and against Ukraine. This is what Scholz’s (and Merkel’s) formula of the “private-sector project” stood for. That wasn’t just naive.
But the attempt, which an old man from 1968 would certainly call it: to pursue state monopoly capitalist industrial policy. Against all political warnings, the Americans as well as the Eastern Europeans. “Business first” – the old German recipe for prosperity, instead of “politics first”. It didn’t take long, just weeks, before the old mistake caught up with the chancellor.
The matter is complex, because politics and economics can no longer be clearly separated: Scholz wants to travel to Beijing at the beginning of November – as the first European statesman after the CP party congress that crowned Xi Jinping as Communist Emperor of China. His goal: to get Xi on the side of the West against Putin’s Russia. Xi is believed to be the only leader who can stop Putin from escalating the Ukraine war to the nuclear level.
But: If Scholz were to personally stop the Hamburg terminal deal with China, he would offend Xi. The reason: Under Xi’s leadership, China no longer differentiates between foreign policy and foreign trade. For the potentate, politics and trade are two sides of the same coin – foreign policy, strategic instruments of power. Xi has weaponized trade.
When Lithuania recently diplomatically upgraded Taiwan because it is a flawless democracy, Beijing, which wants to bring Taiwan home to its empire, subsequently blocked trade with Lithuania. Thorsten Benner from the Berlin GPPI think tank (Global Public Policy Institute) points out that goods from Continental in Germany were also affected. It was a warning shot – to all of Europe.
The problem: The Europeans have not yet found a correct answer to the new, crude practice of the Chinese under Xi’s ideological leadership of turning trade into an imperialist instrument. China policy is essentially made in the national capitals, not in Brussels.
That’s how Angela Merkel handled it, and that’s how her successor does it too. The slogan in Sunday speeches is that Europe must unite to stand up to China. When it comes to traveling on Mondays, the following applies: Germany first.
It could also go differently. Then Olaf Scholz would not travel to China alone, but would take Ursula von der Leyen with him. That would then be a double signal, to Germany’s partners in Europe as well as to the rival partners in China. The task of the President of the Commission would then be to negotiate with China about the rules of the trade game on an equal footing, in technical jargon: a “level playing field”.
Because there is a dramatic imbalance in trade between the West and China. China is constantly expanding its influence in Europe, its main instrument being the “belt and road initiative”, a thoroughly aggressive project that hides behind a cute name: the Silk Road.
And at the same time seals itself off from the outside world. China’s idea of globalization is national, not global: Above all, China itself wants to remain politically self-sufficient, while others, above all the Europeans, want to make themselves economically dependent.
And so far it has been successful. If Germany as a country, or a German company with state influence, or even a German company in general, wanted to participate in a Chinese port – this would be impossible.
There could also be an answer to this problem, which can be found by looking at a map created by the Mercator Institute for China Studies (MERICS): Cosco, the company that wants to buy 35 percent of the Hamburg terminal, is already involved in a number of European Ports involved that compete with Hamburg – the logistics business is tough. Rotterdam, Antwerp, Bilbao – Cosco holds minority interests here. The Greek port of Piraeus is 100 percent owned by Cosco.
The solution: Instead of letting the Chinese drive them through the ring and play them off against each other, the ports could also look for a common answer to the problem that is the same for everyone. But there hasn’t been any talk of that either – so much for Europe.
And Scholz? Might just keep still. If he manages to sit out the issue until the end of October, the Chinese will get what they want. The question is whether the other Scholz will let the matter sit out.
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