Germany's Chancellor Olaf Scholz attends the weekly cabinet meeting. Photo: Michael Kappeler/dpa

Recasts and rewritten throughout following the release of Germany’s China strategy. Economic ties with China should be maintained but “we want to reduce dependencies in critical areas in order to reduce the risks they pose,” according to the strategy.

The new China strategy comes after long and divisive negotiations between coalition partners in Germany’s government.

It also follows the release in June of Germany’s first-ever National Security Strategy, which described China as a partner, competitor, and rival, in line with the European Union’s stance.

The National Security Strategy did not outline how Germany would handle the relationship in the future.

Foreign Minister Annalena Baerbock will present the plans at around 12:15 pm (1015 GMT) at the Mercator Institute for China Studies in Berlin.

Unlike the presentation of the National Security Strategy for Germany, the government has decided against a major presentation to outline its China priorities.

The China strategy released on Thursday argues that the further China moves away from the “norms and rules” of the rule-based international order, the more that critical dependencies of individual German industries or companies on the Chinese market could prove problematic.

For German companies, there is an economic and entrepreneurial interest in avoiding excessive risks and creating new incentives to reduce existing risks: “The federal government is working towards de-risking economic relations with China,” the document says. At the same time, it acknowledges that the Chinese market remains of great importance for many companies.

The German government will continue to “raise awareness” of China-related risks and intensify discussions with German companies. It goes on to say that the government “expects companies to deal concretely with relevant China-related developments, figures and risks within the framework of existing risk management processes.

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“We will confidentially exchange information with companies that are particularly exposed to China on their China-related risk analyses in order to identify cluster risks at an early stage.”

Germany’s China strategy also states that the coronavirus pandemic helped reveal Germany’s dependency on China in, for example, medical technology and pharmaceuticals.

The document also notes critical dependencies in other important areas, such as supplies of rare earths and preliminary products that are required for Germany’s expansion of renewable energy sources.

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