Brighter future on track for economic partners

BRI paves the way for China and Germany to cooperate through goods, infrastructure and 5G technology

Germany and China - two strong supporters of economic globalization and multilateralism - will continue to diversify economic cooperation and build stronger trade ties in 2019. Their products are complementary and they have reached many consensuses on the development of the Belt and Road Initiative, said officials and business leaders.

For many Chinese consumers, "made in Germany" means products such as automobiles, machinery and beer. Now there is an appetite in China for German goods including sensors, semiconductors, new materials and healthcare products sold in direct-mail shops.

China has remained Germany's top trading partner since it took the title from the United States and France in 2016.

Bilateral trade volume between China and Germany amounted to $106.93 billion in the first seven months of this year. This is up 2.4 percent on a year-on-year basis, data from the General Administration of Customs show.

"The future of Chinese-German business ties will be based on the trade of high-end products and consumption goods; investment in the fields of infrastructure and service projects; manufacturing; pharmaceutical business and multimodal logistics," said Zhang Yunling. He is the director of international studies at the Chinese Academy of Social Sciences based in Beijing.

Even though both the Chinese and German economies have been affected by weak global demand, as well as the challenges of unilateralism and trade protectionism, the degree of interdependence between the two countries remains stable in bilateral cross-industry trade, he said.

"China will continue to export consumer goods in exchange for Germany's high-tech products, such as electronic and chemical products; construction machinery; vehicles and parts; medical equipment; and pharmaceutical products," said Yu Jianlong, secretary-general of the China Chamber of International Commerce. "Most of their imports are complementary. Therefore, it isn't direct competition," he added.

China exports mostly raw materials; computers; transport equipment; plastic and rubber products; textiles; garments; and household appliances to Germany.

Many Chinese companies are casting off their dependence on service trade with the US. They are conducting more international collaboration in research and development with countries including Germany, France, Russia and South Korea. Yu said it would be beneficial for China and Germany to deepen cooperation in the service trade, high-tech areas and infrastructure development in their domestic and global markets.

Feng Yaoxiang is director of the investment promotion division at the China Council for the Promotion of International Trade. He said the tangible development of the BRI also comes with opportunities for German companies.

Chances exist in various infrastructure projects for suppliers in the machinery and mechanical engineering industry, in technical fields, engineering and quality management services, he said.

Siemens Mobility, the transport unit of German industrial conglomerate Siemens, plans to build a 5G network innovation center for studies in road traffic in China. It aims to provide digital transportation solutions using 5G technology.

"The future technologies of mobility, such as autonomous driving and traffic management, require 5G. China has taken a leading position in the development of 5G globally," said Juergen Model, CEO of Siemens Mobility for China.

The company said it believes the future of transport will be seen in China and its deployment of 5G will be realized soon.

Siemens Mobility said it is critical to establish an R&D center in the country. It hopes to play a leading role in R&D in this area.

Li Jin, chief researcher at the China Enterprise Research Institute in Beijing, said China has significant market growth potential for its 5G network.

He predicted that in 2019, 5G will cover 50 cities in China. About 300 cities will get 5G connections in 2020. In the year after that, the connection is likely to be available nationwide.

"Besides, China has the largest high-speed train network globally and the largest number of customers. The country will be able to provide a good market, technology support and testing sites to set up a potential innovation center on the future of transportation," he said.

Though the location of the innovation center is still under discussion, the company has established its first mass-transit signaling innovation R&D center in Fuzhou, Fujian province. It is the first masstransit R&D center in Asia.

zhongnan@chinadaily.com.cn

(China Daily 09/07/2019 page9)