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China sees trade with Germany nearly doubling in 3 years

HANNOVER - China and Germany, the world’s two biggest exporters, can nearly double their bilateral trade in the next three years, but must also improve their market access and combat protectionism, Chinese Premier Wen Jiabao said on Monday.

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Speaking at a German-Chinese economic forum in Hannover, Wen also pledged that Beijing would protect intellectual property rights — a key concern for German and other Western investors in China — and the voluntary principle of technological transfers.

“We want to reach a volume of trade in 2015 of $280 billion,” said Wen, in Germany for the biannual Hannover industrial fair, where about 500 Chinese firms are represented.

Trade between China and Germany totalled $190 billion, or €144 billion, in 2011. Germany accounts for about a third of China’s total trade with the 27-nation European Union.

China had a trade surplus of €14.5 billion with Germany last year, but German firms have proven much more successful than their European peers in entering the Chinese market.

Germany produces the high-quality machinery and equipment that Chinese companies need to manufacture their goods, many of which end up back in Germany. China is a giant market for German cars, while Chinese exports to Germany include textiles, electrical goods and toys.

Wen was due later on Monday to sign a deal with German carmaker Volkswagen for the building of a new factory in Xinjiang province in western China.

“The world is open. We all profit from open markets, not closed markets,” Rainer Langelueddecke, head of the Association of German Tool Manufacturers, told Reuters in Hannover, noting that more Chinese firms were also setting up shop in Germany.

But not all German businessmen take such a sanguine view. Some expressed concern during Wen’s two-day visit that China is not only a crucial partner — and the destination of seven per cent of total German exports — but also an increasingly effective competitor that is moving up the value chain.

“Chinese manufacturers may become more and more competitive and become more challenging for German companies,” said Thomas Schrader, managing director of Air Handling Technology.