German Chancellor Angela Merkel walks away after posing for a family picture with other G20 leaders, including Chinese President Xi Jinping (2L). Photo: NurPhoto via AFP/Emmanuele Contini

After more than five months of uncertainty, German Chancellor Angela Merkel has finally formed a government, allowing her to pivot to priorities such as euro zone reform, the war in Syria and immigration.

But Merkel has reportedly told close aides that China’s strategic interests in Europe are now her chief global concern. That is, according to The Sydney Morning Herald, which added that the sources reportedly said she is unlikely to leave office without taking significant steps to counter China’s growing influence.

The Herald did not specify where those comments were cited, but went on to quote Economist Intelligence Unit analyst Pepjin Bergsen as saying that the chancellor now sees Chinese influence, especially in central and eastern Europe, as an even bigger issue than migrant flows across the Mediterranean. That is notable considering that the influx of migrants into Germany has driven the upsurge in support for right-wing parties, and eroded voter confidence in Merkel’s leadership.

“[China’s clout is] something that … Europe and especially Germany is slowly waking up to,” Bergsen said. “There has been increasing investment [by China in Europe] over the past couple of years and thereby also increasing influence.”

Merkel has recently joined French President Emmanuel Macron in urging more scrutiny of investments into Europe, a move which would effectively target China.

The reporting came after The New York Times highlighted Europe’s apprehension regarding China’s rise on the front page of its print edition Monday with the headline “A Power Grab By Xi in China Rattles Europe: Fleeting Hope for Ally in the Trump Era”.

In Germany, Chinese President Xi Jinping’s abolition of term limits has been overshadowed by a recent deal that saw Germany’s Daimler acquired by a much smaller Chinese firm, Geely. The deal, and speculation of funding support from Beijing, adds to concerns that have been building as Chinese firms aim to buy up German technology.

“It’s a highly public discussion about Chinese influence in Germany,” Angela Stanzel, an Asia expert at the European Council on Foreign Relations, was quoted as saying. “There have been 10 times as many articles about Daimler than about Xi prolonging his rule.”

Asia Times Financial is now live. Linking accurate news, insightful analysis and local knowledge with the ATF China Bond 50 Index, the world's first benchmark cross sector Chinese Bond Indices. Read ATF now.