Germany, China eye joint business efforts in Africa, Asia

German Chancellor Angela Merkel (second from right) is explained a process by an employee during a visit to the BMW Brilliance Automotive in Shenyang, China, on June 14, 2016.
German Chancellor Angela Merkel (second from right) is explained a process by an employee during a visit to the BMW Brilliance Automotive in Shenyang, China, on June 14, 2016.PHOTO: EPA

SHENYANG, CHINA (REUTERS) - Germany and China plan to pursue business opportunities in Africa and Asia together, German government and industry sources said this week during German Chancellor Angela Merkel's ninth visit to China.

They cited particular interest in areas such as infrastructure, energy, transportation, environmental protection, agriculture and health care.

Merkel told reporters during a visit to a high-technology forum that China had made huge strides in many business areas, including its construction of rail cars, with its production costs possibly undercutting those of German manufacturers.

"If we join forces and get active in markets such as Asia or Africa, we can all benefit from our combined strength," Merkel told reporters.

Merkel's trip comes in the midst of a furious debate over Chinese takeovers in Europe and fears over the loss of key technology, with some politicians calling for tougher restrictions. During her trip, Merkel praised the growing maturity and breadth of German-Chinese relations but also challenged Beijing to ensure a level playing field for German firms.

The sources said further cooperation was aimed at helping German companies cope better with increasing competition and rapid technology increases by Chinese firms, and to help Chinese firms learn greater respect for international norms and standards, including environmental concerns.

Joint business campaigns could help German firms, which have complained in recent years that they find it difficult to compete with Chinese firms in overseas markets, given their ability to tap into large government subsidies.

Joint German-Chinese teams could knock competitors out of the running, while helping German firms tap into larger Chinese financial resources, the sources said. Financing could be provided through a new Chinese "Silk Road Fund" and the new Asian Investment Bank, they added.

Siemens, for instance, signed an agreement with China's rail car manufacturer CRRC late on Monday, and further agreements are planned in the energy sector, the sources said.

On the governmental level, China and Germany also pledged to increase their cooperation in Afghanistan, beginning with a pilot project in training for work in underground mines, and development projects in Africa, the sources said.