The German government will create an institutional facility to improve its understanding of China, according to a draft budget seen by Euractiv, as EU countries seek to bolster their resilience to China’s growing power and influence in global politics.

Germany’s coalition government will integrate the Mercator Institute of Chinese Studies (MERICS), an influential China-focused think tank, more closely into state structures by providing it with institutional funding from 2024.

While retaining its independence, MERICS will assume an exclusive role within Germany’s China policy and will receive a significant financial boost of €500,000 as part of a first round of funding from the German Foreign Office in 2024, according to the draft.

“With the institutional funding for MERICS, we want to expand Germany’s expertise in China policy,” Jamila Schäfer, a member of the Bundestag’s budget committee and a Green MP, told Euractiv.

The government of the centre-left SPD, the Greens and the liberal FDP sees the active promotion of its monitoring capabilities of China as an important step towards the larger goal of preparing itself for China’s new dominant role – and should also supplement parallel efforts on the European stage,  Schäfer added.

Faced with China’s power, the EU and its allies have become increasingly concerned that it is manifesting itself mainly in threatening behaviour towards Taiwan and in the South China Sea, as well as in EU countries’ economic dependence on Chinese markets, production and resources, which they fear could be weaponised by China.

European Commission President Ursula von der Leyen herself has echoed this sentiment as she has repeatedly warned EU countries to “de-risk” their ties to China in response to its changing role – a message she repeated in Germany at a conference of her party and largest opposition group CDU/CSU. “Our relations with China have become more distant and difficult recently”, she said.

Germany’s new approach

Adopting a new approach to China was a major challenge for Germany, which had previously built its relationship with Beijing around strong trade ties, with China being its most important bilateral trading partner.

Given the changing geopolitical landscape, it was now important “not to leave the general China policy to the headquarters, as has been the case in the past” and to build political competence in dealing with Beijing through close cooperation with MERICS, Schäfer said.

This would also support the priorities of Germany’s first-ever China strategy, published in July, which assigns a key role to MERICS’ “outstanding role in building China-related competence in politics, society, business and academia”.

However, the think tank will also face significant headwinds, as China has taken a critical stance towards its activities.

In 2021, MERICS was placed under Chinese sanctions in retaliation for the EU’s sanctions against Chinese officials, preventing MERICS staff from entering China.

The think tank has since been forced to rely on local contacts for most of its on-the-ground research.

(Nick Alipour | Euractiv.de)

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