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The new Asia Free Trade Pact is China’s answer to “America first.” Globalization is going offline. The German export industry faces a problem.
“America First” is having an effect. While the still president of the United States, Donald Trump, is turning a corner, circumventing international agreements and, even after losing the election, trying again and again to praise the successes of his protectionist policies, Beijing creates facts. Faster than expected, of all things, communist China is forging a free trade pact that is unparalleled in its economic importance. The world’s largest free trade zone will account for around 30 percent of world trade in the future, this has never been done before.
The consequences are obvious: the seemingly endless globalization is gradually coming to an end. She is divided. Two poles are emerging: one dominated by China and the other by the United States. While Trump has turned his long-term economic policy partners against him, Beijing is smarter. The Chinese are expanding their position as a major economic power by attracting the relevant economies of the Asia-Pacific region to their side. The fact that even Japan is joining the new agreement underscores the relevance of the new agreement. Until now, the Japanese had always felt that they belonged to the western bloc dominated by the United States. And the economic importance of China is likely to grow. It was long agreed that Beijing will also unite the countries along the New Silk Road more closely.
The German economy, whose well-being and affliction depend on the success of foreign trade, makes it a conflict of interest. For them, development has lasting consequences. As a result of the global corona pandemic, German exports have already suffered greatly in recent months. When the threat of the coronavirus at some point subsides, the next challenge is: How will you master the sandwich position? How can German companies continue to do business with China without misleading their Western partners, especially the United States?
Diplomatic skills are required. More than ever, it is important to bring together European interests and inspire other trading partners, also in Southeast Asia, to closer cooperation. There’s a glimmer of hope: America-First’s tough politics are likely to be history by late January. If Trump’s successor Joe Biden is more cooperative, that can help. But it won’t be easy.
