Germany GmbH has invested heavily on doing business with China. The Chinese economic miracle has turbo-charged the German export machine, fattening profits and bringing full employment.
Suddenly, though, German industry has begun to fret it is now on the losing side of the Chinese bet — and not just because of a recent slowdown in the world’s second-largest economy.
The entrenchment of Chinese state capitalism under President Xi Jinping has shown that Germany — indeed, the west — was wrong to assume that trade and investment would bring China closer to the open-market economy model of Europe and the US. The miscalculation was rammed home by Mr Xi’s Made in China 2025 policy to turn his country into a market leader in 10 strategic industrial sectors and to reduce reliance on foreign technology.