AHK Policy Barometer

Our Policy Barometer provides quarterly economic policy insights for German companies in China. It offers updates on current economic policies, how they impact German businesses, and our evaluation of them. We also provide information on our advocacy efforts regarding these policies with both the German and Chinese governments. In addition to this, the Policy Barometer includes valuable resources and practical tools. The full version of the Policy Barometer is exclusively available to members of the German Chamber and is delivered directly via email.

Vol. 2/2024

Equipment Replacements and Consumer Goods Trade-ins

Status Quo:To boost the economy, the Chinese government has placed emphasis on implementing equipment renewal and consumer trade-in policies. Over the past few weeks, several authorities have released action and implementation plans which have an estimated value of around 5 trillion yuan. While also serving the promotion of China’s green development, the policies include updates of 294 key national standards

Pulse Check: German companies should watch out for potential subsidies and probably need to adjust their practices to meet updated national standards. The emphasis on green development presents an opportunity for growth for companies by leveraging technical expertise and renowned products. Policies aimed at consumers could boost domestic demand, which foreign businesses are eagerly waiting for.

 

German-Chinese Relations

Status Quo: In Q2 2024, there were several important visits between the German and Chinese governments. Chancellor Olaf Scholz came to China for a three-day long trip together with a business and political delegation, while Federal Minister for Economic Affairs and Climate Action Robert Habeck visited in June with a group of mostly SME business representatives.

Pulse Check: Chinese and German companies are increasingly becoming close competitors - both in China itself and in global markets. At the same time, a significant share of German companies say they are affected by unfair competition. That’s why companies whish that equal treatment of foreign and domestic companies has been addressed by the German government during the high-level visits.

 

EU-China Relations

Status Quo: The European Commission proposed provisional additional duties between 17.4% and 38.1% on imports of new battery electric vehicles manufactured in China on June 12. Final measures are to be imposed within four months after imposition of these provisional duties. The Ministry of Commerce initiated an anti-dumping investigation against European pork and its by-products on June 17, 2024.

Pulse Check: The impact of the proposed provisional duties on NEV originating from China on German companies is yet to be seen, while the consequences of the Chinese anti-dumping investigation on pork is expected to be low. However, German companies already face mounting pressure in a business landscape marked by geopolitical tensions. The risk of more potential countermeasures only adds to this challenge.

 

Green Policies

Status Quo: China's renewed prioritizing of green transformation in 2024 was evident through discussions during the Two Session and especially with recent initiatives during Q2 2024. These include promoting green financing, energy efficiency, carbon management, and social responsibility among companies, all aimed at achieving China's first decarbonization goal by 2030.

Pulse Check: Companies are more and more seen as important actors in the decarbonization journey. German companies, with their extensive expertise in environmental technologies and green solutions, are well-equipped to support China's green transformation. They have a proven record of accomplishment of contributing to China's economic development and innovation through their rich expertise in advanced technologies and high-quality solutions.