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like Germany, is interested in developing its industrial production – including
in sectors in which Germany has a competitive advantage, such as machine
production and the new technologies sectors. If Chinese producers obtained
access to German technologies, they could quickly push Germany out of their
markets by making use of generous state support and subsidies. Another example
of similar developments is the solar installation production sector
which has recently declined in Germany; many leading companies have gone
bankrupt or been acquired by Chinese investors. It appeared that the German
government set a system of excessively high subsidies available to this sector.
As a result, when the scale of subsidies was later limited, German companies
lost the competitive battle to Chinese companies which have benefited from
the considerably lower labour costs. This leads Germany to expect greater security
of intellectual property and a wider opening of the Chinese market in
exchange for the transfer of technologies to China. Members of the German
government have consistently criticised China for limiting the imports of rare
raw materials in 2009, and put pressure on the EU to file a complaint with the
World Trade Organisation against China in relation to these practices 67 . On the
other hand, during bilateral consultations in 2012, Chancellor Angela Merkel
promised the Chinese government dialogue to resolve the problem of Chinese
solar panel producers whom the European Commission had accused of resorting
to dumping practices 68 .
5.2. Russia
Germany hoped that the changes in its economic relations with Russia could
contribute to gradual reforms in Russia. Initial attempts were made in the
1990s, when Germany provided help in training Russian state officials, albeit
without any measurable success. Another attempt was the partnership for
modernisation project, but this concept was also troubled by divergent expectations.
Germany expected a systemic change to take place in Russia which
could have improved the level of investment safety and facilitated business activity,
leading to the greater expansion of German companies on this market.
Moscow, on the other hand, hoped that the cooperation would facilitate the
transfer of technologies from the EU countries in exchange for Russian raw
materials. This is why the project did not bring about any breakthroughs. Instead,
it was a disappointment to both parties, and failed to encourage other
67
http://www.bmwi.de/DE/Presse/pressemitteilungen,did=422450.html
68
http://www.bmwi.de/DE/Themen/aussenwirtschaft,did=510960.html
PRACE OSW REPORT OSW 09/2012 11/2013
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