When Chancellor Angela Merkel visits Beijing at the weekend, it’s supposed to be a friendly affair. Both countries are celebrating the peak of their relations. Ms. Merkel is bringing along half her cabinet for a round of intergovernmental consultations. The Chinese hold their guests from Germany in high esteem, and Ms. Merkel has already visited the country eight times.
The mood among people in the business world, however, is subdued. And the reason isn’t just the current controversy over the planned takeover of German robot-maker Kuka by the Chinese appliance maker Midea, which has raised concerns about the transfer of commercial knowledge. On Wednesday, a proposal to block such foreign firms from taking over German companies that are seen as economically and strategically important was revealed by Die Zeit newspaper, citing government sources familiar with the matter.
The key reason could be that many European firms say they aren’t satisfied with the business climate in the Asian superpower, according to a new poll. And now China’s official news agency is warning about a “trade war” should the European Union not classify China as a market economy. Such a designation is a coveted status that means a particular economy is based on supply and demand and a free price system.
“We have never experienced so much pessimism,” Jörg Wuttke, president of the European Union Chamber of Commerce in China, said.