Oliver Moody

Oliver Moody



I've just finished an essay on Germany's China policy and Scholz's imminent trip to Beijing (out later today) and I'm repeatedly struck by the sheer scale of the scepticism towards China among the German public and business world - short thread /1

This is from the @gmfus Transatlantic Trends report, published at the end of September - suggests the German public is just about as wary of China as any of the other 14 countries they surveyed, including UK and even Sweden and Lithuania (!) /2

Here's some data from @KoerberIP's Berlin Pulse report, released a couple of weeks ago - 66% of Germans want to reduce economic dependence on China even if it means sacrificing a certain amount of prosperity. And just look how much perception of Chinese influence has shifted. /3

On German business sentiment, this @ifo_Institut report from March (in 🇩🇪) makes for fascinating reading: Clearly widespread discomfort at reliance on Chinese imports in German supply chains, and plans to reduce it /4

It looks like the nature of Germany's economic reliance on China is shifting from exports to imports. As @Brad_Setser points out in this useful thread, exports to China haven't made much contribution to German GDP growth since ~2015 /5

In fact the trade deficit is widening very rapidly, reaching nearly €41 billion in the first six months of this year, as German firms become increasingly dependent on Chinese imports /6

Last week the @Der_BDI, which was urging a change of course towards China as early as 2019, noted in a report that Germany is more dependent on Chinese minerals now than it ever was on Russian oil and gas: /7

Anyway, lots more to come in the long read later, but it's v interesting to see that (A) there is very widespread recognition in Germany of the strategic trap yawning in front of it; and (B) most of the economic data seem to suggest it's headed into that trap regardless /ENDS

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