German Chancellor Angela Merkel waves to the crowd at an election rally in Munich on September 24. During her time in office, she has come to symbolise the stability and predictability for which Germany is renowned. Photo: DPA
Inside Out
by David Dodwell
Inside Out
by David Dodwell

Why Germany’s post-Merkel shift is no threat to China’s interests

  • Beijing and other governments around the world are watching with trepidation as Germany’s first post-Merkel government takes shape
  • German politics will be messy for a while, but US missteps in Europe have short-circuited any coalition of Western democracies unified against China
If the European Union is the balancing power that can moderate the escalating tensions between the United States and China, then Germany is the balancing power within the balancing power. This makes the imminent retirement of Angela Merkel, and the seismic shifts in the recent German election, developments that we in Asia cannot ignore.
The election results are likely to produce an unprecedented three-party coalition between the Social Democrats (SPD), Green Party and Free Democrats (FDP). For China, the results are likely to deliver good news and bad.

Worst is the simple reality of Merkel stepping down. The longer the future coalition partners take to reach agreement on how they will share power, though, the longer it will be before Merkel goes.

During the last elections, in 2017, Merkel took six months to form her two-partner coalition with the SPD. This time, most pundits are predicting Merkel will still be acting chancellor well beyond Christmas.

For China and most of the world’s governments, Merkel’s departure is being watched with some trepidation. Her qualities – usually summarised as calmness, composure, sobriety, unpretentiousness, good humour, dependability, and impeccable skills in crisis management – have been indispensable over many international challenges and will be missed.


Germany’s Social Democrats win election, chancellor candidate Scholz celebrated by his supporters

Germany’s Social Democrats win election, chancellor candidate Scholz celebrated by his supporters
During her time in office, she has come to symbolise the stability and predictability for which Germany is renowned. Among her predecessors, Konrad Adenauer led the government for 14 years from 1949 and Helmut Kohl for 16 years from 1982.
Contrast these with three US presidents, five UK prime ministers and nine Italian and Japanese prime ministers since Merkel came to power in 2005. Among the leaders of the world’s developed democracies, only Singapore’s Lee Hsien Loong has served longer.

Her pragmatic management of relations with China and steadfastness in ensuring the EU took a similar path have been as valuable as her predictability. All of this is now up in the air, with the new German coalition government likely to include the Greens, who have traditionally been more cautious on relations with China.

Their leader, Annalena Baerbock, is calling for “ dialogue and toughness” towards Beijing, which is likely to mean tougher positioning on human rights issues. Much will also rest on the climate initiatives China can bring to the November COP26 summit in Glasgow.


What is China doing about climate change?

What is China doing about climate change?
China will take comfort that Olaf Scholz, leader of the SDP and the likeliest candidate to become chancellor, is seen as having many of Merkel’s steady qualities. He is not likely to inherit Merkel’s influence in the EU, though. That is instead set to be captured by French President Emmanuel Macron, which might also be welcomed in Beijing.
Macron’s calls for the EU to build “ strategic autonomy” for the defence of Europe and the projection of Europe’s influence around the world remain unclear. They might not be helpful to China and could lead to more military spending in Europe, but they do not necessarily point to a more aggressive EU posture on China.
On the contrary, France’s dismay with the new Aukus agreement – wherein Australia cancelled plans to buy US$36.5 billion worth of diesel-powered submarines from France – has added to a growing list of EU grievances with the US and is creating concern over America’s predictability as an ally.
This has included the withdrawal from Afghanistan, US efforts to waive patent protection on Covid-19 vaccines, plans for a minimum global corporate tax and a series of tariffs on EU exports. As Thierry Breton, the EU commissioner for internal markets, complained: “Something is broken in our transatlantic relations.” China might not be loved in Europe, but it has at least been consistent and predictable.


US, UK, Australia announce ‘historic’ military partnership in Pacific

US, UK, Australia announce ‘historic’ military partnership in Pacific
China might also take comfort that Germany’s elections were fought less on foreign affairs than on domestic issues such as the impact of the pandemic, worries over management of climate change, stable pensions, affordable housing and higher wages.
Merkel has won praise at home for her management of the economy. Unemployment is low; German manufacturers account for 30 per cent of EU output, in part because of success in piggybacking on China’s rise; and debt levels are low thanks to her 2009 balanced budget law, enabling strong support for the critically important car industry after the 2008 global crash and for the government’s Kurzarbeit unemployment insurance scheme.
But in the election campaign, her party drew criticism over underinvestment, stagnant wages at a time when fears over inflation were rising, inadequate investment in education and on the transition away from coal. They were also criticised for failing to build the digital economy, in particular a slow and patchy roll-out of 5G services.
Military personnel survey the devastation along the Ahr River on July 21 after flooding in Rech, Rhineland-Palatinate, western Germany. Germany’s elections were fought mainly on domestic issues, including worries over management of climate change. Photo: AFP

While there are anxieties over the shape of Germany’s new ruling coalition, most pundits are betting against a radical shift despite the credentials of the Greens and the FDP. As Robert Vehrkamp, at the Bertelsmann Foundation, said: “If the SPD, Greens and FDP team up, I wouldn’t see it as a left-wing coalition but a liberal, ecological, modernising coalition.”

US missteps have blunted the potential for a coalition of Western democracies unified against a rising China, the foundations of which were anyway fragile because of Europe’s weak sense of any existential China threat.

This does not suggest that relations with China are likely to be easy, and much will depend on how adroitly Beijing can address the climate challenges attracting growing concern across Europe.

As the Post’s Finbarr Bermingham noted in August: “Europe finds itself caught in the middle of two sparring superpowers, and will soon be without its most experienced referee.” Merkel will be missed, and politics in Germany might remain messy for a while, but China should not fear any imminent crisis.

David Dodwell researches and writes about global, regional and Hong Kong challenges from a Hong Kong point of view