Trade tops Merkel agenda during seventh China visit

Angela Merkel began her seventh visit to China as German chancellor with a visit to a FAW-Volkswagen car factory in Chengdu in Sichuan province, underlining her intention to boost trade ties with the world's second biggest economy. The visit is scheduled to last until tomorrow.

Germany is the European Union's biggest economy and China has become an extremely important market for German goods, from consumer goods to agricultural machinery to top-end cars.

China is Germany’s third-largest export market, behind the EU and the United States. It sold goods worth €67 billion to China last year, while imports from China topped €73 billion. Trade between Germany and China increased by a hefty 9.8 per cent in the first quarter of this year.

Dr Merkel met premier Li Keqiang yesterday and is scheduled to meet President Xi Jinping. A meeting in Beijing's Great Hall of the People is expected to see the signing of many deals, including a possible joint venture between German flag carrier Lufthansa and the state-owned Chinese airline, Air China.

Travelling with her delegation are executives from some of Germany's biggest companies, including Joe Kaeser from Siemens, Juergen Fitschen from Deutsche Bank and Martin Blessing from Commerzbank as well as representatives from VW, Airbus and Lufthansa.

As she toured the factory in the southwestern city, Martin Winterkorn, Volkswagen’s management board chairman, spoke of how important the Chinese market was for the car-maker. The Chengdu plant has about 7,300 employees producing 450,000 vehicles a year.

“Here in China, we are setting high environmental standards at our 17 locations and investing more in eco-friendly technologies and plants than ever before,” Mr Winterkorn said. “Volkswagen is banking on China’s innovative power because this market provides key impetus for our industry through groundbreaking new trends.”

Dr Merkel also attended a conference on urbanisation and visited a project for the children of migrant workers.

While trade is expected to dominate, rights groups have urged the German leader to push human rights on to the agenda. Having grown up in communist East Germany, Dr Merkel has generally been more forthright than other EU leaders at addressing human rights issues, in China and in other countries.

The World Uighur Congress sent Dr Merkel an open letter at the weekend urging her to discuss the fate of the Muslim minority in Xinjiang province, which has seen a crackdown since a series of deadly separatist attacks around the country. Rising tensions in the restive region have caused about 400 deaths between March 2013 and June 2014.

“The past two years have seen an increase in the use of violence and an even more heavy-handed approach by the Chinese,” Rebiya Kadeer, the exiled president of the World Uighur Congress, wrote.

Germany's top spy, Hans-Georg Maassen, who is head of the BfV domestic intelligence agency, told the Welt am Sonntag newspaper yesterday that German medium-sized companies, the Mittelstand firms, faced the growing threat of cyber-espionage from Chinese state agencies. "Many medium-sized German firms are easy prey," he told the paper.

Documents leaked by the former US intelligence contractor Edward Snowden have shown that the US National Security Agency has spied on Chinese companies such as Huawei Technologies, and also tapped Dr Merkel's mobile phone. The Merkel administration is still rebuilding trust issues with Washington since then.