Germany quashed 2018 report on Chinese influence to protect business interests

The country has since shifted its China policy amid rising scrutiny on China's track record on human rights.

Kayla Wong | October 08, 2020, 06:08 PM

A senior German official had hushed up a 2018 intelligence report on China's growing influence in the country in order to protect Germany's business interests, Axios reported.

Report suppressed as it can affect Germany's business relations with China

According to two former United States intelligence officials, the report included assessments on the Chinese government's efforts to influence the German government, society and business.

Due to its sensitive nature, it was suppressed before it was seen by the German government.

It was, however, seen by German Chancellor Angela Merkel.

Germany's China policy guided by economic interests largely

Axios further reported that business interests have mostly driven Germany's China policy.

Since 2016, China has been Germany's largest overall trading partner.

German exports make up a large part of the country's economy, and bilateral trade between the two countries amounted to a whopping 188 billion euros (S$300 billion) in 2019, according to Reuters.

As a result, German businesses have considerable influence over the government, former German ambassador Volker Stanzel told Axios.

To preserve their economic interests with China, these businesses typically refrain from commenting on China's human rights record, and also discourage their government from doing so.

This explains why prominent carmaker Volkswagen, which operates a factory in Xinjiang, has denied knowledge of the mass detention camps that hold more than a million Muslim Uyghurs in the region.

Growing scrutiny on China's human rights practice

But as China's economic practices and its track record on human rights gain greater scrutiny globally, there are growing calls within Germany to reduce reliance on the Chinese market.

According to Reuters, a report from the Federation of German Industries (BDI) -- the country's main business lobby group -- while acknowledging China's importance in the German economy, advised German firms to reassess the risks of engagement with China and to minimise their dependence by diversifying their supply chains.

In a speech to the German parliament before a European Union summit, Merkel has also voiced concerns over China's "poor and cruel treatment" of its minorities, and said she would bring up the issue of the crackdown in Hong Kong in future talks with Beijing.

Germany has also indicated a shift in its policy towards the Indo-Pacific, with German foreign minister Heiko Maas saying in a statement issued on Sep. 2 that the country intends to place greater emphasis on "rules and international cooperation, not on the law of the strong".

He said: "... we have intensified cooperation with those countries that share our democratic and liberal values".

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