German Chancellor Angela Merkel welcomes China's President Xi Jinping to the G20 summit in Hamburg, Germany, July 7, 2017. Photo: AFP/Odd Anderson

PRAGUE – While the US and its allies target China in an emerging new Cold War, Germany has by all accounts taken a more calibrated approach towards the Asian giant.

But with German Chancellor Angela Merkel poised to step down next year after 15-years in power, questions are rising about what the leadership transition could mean for Berlin-Beijing relations – and more broadly for European Union-China ties.

While other European capitals have hardened their stance on China in the wake of the Covid-19 pandemic and China’s rolling back of Hong Kong’s freedoms, Berlin has remained resolute in its belief that cordial diplomacy and close economic ties are the better tack.

Unlike certain of her European counterparts, her China diplomacy has focused on non-interference in Beijing’s internal affairs. As such, Merkel was reportedly furious when her Foreign Minister Heiko Maas received Hong Kong dissident Joshua Wong in Berlin in September, a move that Beijing publicly protested.  

Merkel, who remains popular with the electorate while her governing Christian Democrats (CDU) has made recent gains in opinion polls for the government’s handling of the Covid-19 pandemic, nonetheless faces rising criticism for her perceived soft-pedaling on Beijing for narrow commercial interests.

Her hopes of hosting a special EU-China summit in Leipzig in September while Germany holds the rotating EU presidency were ostensibly dashed because of the pandemic, though a breakdown in talks for an EU-China investment pact was also likely a factor.

Merkel said in 2018 that her current tenure would be her final term in office, meaning a new leader will have to represent her governing CDU-CSU union at the next federal elections due after August 2021.

Her preferred successor, Annegret Kramp-Karrenbauer, who she helped push through as her replacement as CDU leader in 2018, has by nearly all accounts been an unmitigated disaster. In February, she said she wouldn’t run for the chancellorship next year.

In the highly unlikely event that the CDU-CSU alliance loses next year, Germany’s China policy would almost certainly toughen. However, with a CDU-CSU victory likely, foreign policy could swing on who leads the alliance into the election and which parties they attempt to form coalitions with after the ballot.

Norbert Röttgen addresses the press in March 3, 2020. Photo: AFP Fourm via DPA/Sonja Wurtscheid

There are certain China hawks in the wings. Norbert Röttgen, head of the Bundestag’s foreign affairs committee and still by all measures a rank outsider in the leadership race, has been the loudest among German conservatives to push for a tougher line on China.

Röttgen has blasted Merkel’s foreign office for “self-censorship” on Xinjiang, the Chinese province where Muslim Uighurs are being held in conditions rights groups have characterized as concentration camps, as well as the fast erosion of rights in Hong Kong under a new Beijing-imposed security law.

He has persistently maintained that Berlin should take a tougher stance on Beijing’s flouting of international laws, as seen increasingly in other European capitals including London and Paris, both of which have resolutely criticized China’s imposition of a harsh security law for Hong Kong.

Röttgen’s opposite number in tone and likelihood to succeed Merkel is Markus Söder, the current odds-on favorite to become the next chancellor and arguably the most pro-China of Merkel’s possible successors.

Söder, the leader of the Christian Social Union in Bavaria (CSU), the regional counterpart of Merkel’s CDU and minister-president of Germany’s industrial heartland of Bavaria, is known for speaking in the same muted tones as Merkel and putting German business interests first in dealing with China. Some see him as even more pro-China than Merkel.

Some of Germany’s most important firms, including BMW, Audi and Siemens, are based in Söder’s Bavaria and all have extensive operations and ties in China. Meanwhile, Germany’s exports to China have quintupled since Merkel became chancellor in 2005, hitting US$108 billion last year, according to the World Bank.  

As one of Europe’s most export-reliant nations, Germany is more dependent on China’s market than any other European state. In 2018, Germany accounted for almost half of all EU exports to China.

Some suggest that’s one big money reason for Merkel’s comparatively softer stance on Beijing. So, too, could be a Chinese government threat by Chinese Ambassador to Germany Wu Ken’s threat in December to punish German automakers if Berlin is perceived to be overly critical of Beijing’s actions or policies.   

Bavaria’s State Premier Markus Soder stands on the tarmac at the airport in Munich, August 24, 2020. Photo: AFP/Peter Kneffel/Pool

Whether Söder’s current perceived soft-pedalling on China owes to protecting Bavarian businesses interests, and whether he will seek to do the same for all German firms if he succeeds Merkel as chancellor, is yet to be seen. 

Yet he is the closest to Merkel in terms of putting German business first. Among other tipped candidates, Friedrich Merz, a prominent CDU figure, is perhaps the most skeptical of China after Röttgen, though he is not nearly as hawkish.

For instance, Merz was quick to say that European countries should offer right of residency to Hong Kongers after Beijing imposed its national security law over the semi-autonomous city in June, a policy Beijing has taken umbrage with in the UK and elsewhere.

The moderate Armin Laschet, head of the CDU in North Rhine-Westphalia, Germany’s most populous state, has tended to stay out of the debate entirely. Jens Spahn, the 40-year-old minister of health and a noted Merkel rival, seems for now to also be sticking to Merkel’s pro-China script.

Two issues may explain why Merkel’s potential successors, apart from Röttgen, have so far avoided staking out their positions more clearly in the China debate. For starters, the leadership race hasn’t really started due to the Covid-19 pandemic.

Possible successors are thus shying from making pronouncements on foreign policy matters, especially when Merkel’s gentle approach is still in the forefront, says Noah Barkin, an expert on Europe-China relations at Rhodium Group, a New York-based independent research provider.

“Germany’s relationship with China and its positioning in the US-China conflict will be absolutely central to the country’s future. So one has to hope that this debate picks up as we get closer to the end of the year,” he added.

When the debate begins, however, there may be a greater push by less senior CDU members – who are often more critical of China than the cabinet – to foist their views on the candidates during electoral horsetrading, though some wonder if it will be a critical issue of distinction.

Indeed, while most analysts reckon Röttgen is unlikely to win the leadership race, “he could remain an influential figure and the driving force behind the conservative party’s China policy,” says Bernhard Bartsch, senior Asia expert at the German foundation Bertelsmann Stiftung.

Second, Berlin is hesitant about taking sides against China until it has a better idea of the trajectory of its transatlantic relationship over the next decade, a picture that will become clearer after the US presidential election in November.

German Chancellor Angela Merkel and US President Donald Trump hold a joint news conference at the White House on March 17, 2017. Photo: Handout/Agencies

Berlin-Washington relations have deteriorated throughout Donald Trump’s presidency, so much so that a majority of 12,000 American troops stationed in Germany were recently ordered by Trump to move out.

It’s hardly a state secret that Trump and Merkel aren’t on great diplomatic terms.

While Trump has constantly lambasted Berlin for not paying enough to shared security responsibilities, Merkel’s government has rebuffed Trump’s efforts to pressure European allies to stop using technology from Huawei, the Chinese tech giant Washington accuses of spying on behald of Beijing.

The Trump effect has meant now a majority of Germans prefer good relations with Russia than the US, recent polls show.

It’s also an open secret that most European capitals, including Berlin, would prefer Joe Biden, the Democratic Party’s presidential candidate, to replace Trump in the White House in January. Yet Biden has insinuated on the campaign trail that he, too, would take a tough tack with China.

Moreover, there’s still uncertainty about what the German electorate thinks of China. “Surveys show that Germans don’t perceive China as a very emotional or pressing issue,” says Bartsch. “A populist political campaign like Trump’s ‘China is stealing our jobs’ wouldn’t work in Germany – luckily.”  

Like most Europeans, the majority of Germans blame China for the pandemic. Some 77% of respondents said as much in a poll by London-based Redfield & Wilton Strategies in May. (Although a similar percentage said the pandemic had worsened their views of America.)

The US-based Pew Research Center found that whereas only 24% of German respondents felt last year that it was more important for Germany to have a closer relationship with China over the US, the figure climbed to 36% this year. 

Still, Merkel’s refusal to take a tougher line on Beijing has cost her certain political capital, Bartsch says, something that her inevitably lesser-known and more inexperienced heir may not be able to afford.

German Chancellor Angela Merkel and Chinese President Xi Jinping attend a contract signing ceremony at the Chancellery in Berlin, July 5, 2017. Photo: Handout/Agencies

“For a successor who doesn’t have Merkel’s standing and stubbornness, coming up with a China policy might be easier than avoiding one,” he said.

Moreover, Merkel’s successor will face more pressure from other German parties who have adopted far tougher lines on China. The Greens, for instance, have argued that Berlin should sanction Beijing for its human rights violations, as well as stop using Huawei technology, especially for Germany’s developing 5G network.

While Merkel’s CDU is hemorrhaging support, losing 65 seats in the Bundestag at the last general election in 2017, it has resurged in popularity due to its perceived as capable handling of the pandemic.

That’s been seen in Merkel’s soaring approval rating, which has jumped up to around 70% in recent months, compared to around 50% last year.

Still, whoever takes over from her will likely need to rely more on coalition partners with potentially different views on China. That could include the vocally anti-Beijing Greens and the far-right Alternative for Germany (AfD).

What those other parties think about China may influence the next German chancellor in ways that Merkel never had to countenance over her long and highly independent tenure.