Bilateral partnership steps into a new age

The new industrial era offers unrivaled opportunities for cooperation and friendly rivalry between two already close allies

The Sino-German partnership is one that is indispensible to both sides. Germany is China's fifth-biggest trading partner and its most important one in the EU. China is Germany's fourth-biggest trading partner and its most important one in Asia.

Bilateral trade has nearly tripled in the past decade, up to a volume of 163 billion euros ($182.7 billion) in 2015, a year in which China held its position as the top foreign investor in Germany in terms of the number of projects.

More than 50 percent of German exports to China consist of cars, car parts and machinery. China is Germany's major supplier of electronics and textiles products. The relationship between our countries has developed to the stage where our economies are highly dependent upon each other, so it is of paramount importance that we maintain our excellent relationship.

We have been able to do so throughout China's transition from an economy based on production and exports to one that is innovation- and consumption-led. Thus we are now importing more chemicals, electrical products and machinery from China than before. Meanwhile, we are exporting more consumer goods to China than previously.

Nowhere is this more apparent than in what we in Germany call Industrie 4.0, or the industries related to the fourth industrial revolution. In Germany we are producing high-tech solutions for machines used in the manufacturing industry, while in China there is vast potential for the use of such machines.

The pre-conditions for synergy between the two countries in this regard could not be more complementary. Indeed, with the 'Made in China 2025' long-term strategy bearing more than a vague similarity to Germany's 'High-Tech Strategy 2020', it would seem that our countries intend to move down similar paths.

This synergy is clearly developing. China kept its position as Germany's top foreign investor in 2015 in terms of total number of projects with 260, with 28 percent of these being related to either machines and plants or electronics.

This development has been built on the good foundations laid by the strategic partnership in innovation between China and Germany in 2014, a partnership that led to the creation of the German-Chinese Innovation Platform.

The similarities between 'Made in China 2025' and Germany's 'High-Tech Strategy 2020' create just as many opportunities for competition as they do for synergy.

We welcome our special relationship with China not only because it enhances both our economies, but also because it will enable us to use the knowledge, technologies and techniques we gain from each other to compete more effectively, both with our global rivals and each other.

In Germany, we have tried to build an ideal platform for this coopetition, by building an industrial landscape which researches, innovates and creates value. We have 3.64 million small- and medium-sized enterprises - 99.6 percent of all Germany's registered companies - many of which are either dominant in tiny global niches across all industries, or deep in research into as yet unexplored pockets of potential value across those same industries. They form the backbone of our economy, which remains Europe's largest and most robust, even in the wake of the numerous economic shocks that have rocked us over the past decade.

Furthermore, we in Germany are proud of the quality of our workforce; our dual education system values role-specific apprenticeships just as much as academic study. This ensures that we have a talented and balanced labor force filling a wide range of diverse and important roles.

Germany sits at the geographical heart of Europe, enabling access to the vast EU market. In itself, the country's market of 82 million people is Europe's largest. We have transport and ICT infrastructure regularly rated among the world's best.

For all of these reasons, Germany is the perfect location to begin this process of coopetition. As we have seen, many Chinese investors are already taking advantage of these opportunities and are creating excellent value for both countries.

The writer is the chairman and CEO of Germany Trade and Invest.

(China Daily 06/13/2016 page6)