Germany may be searching its supply chains for leverage on China. Will it find any?
Although many analysts deem the search long overdue, they warn that German leverage would be both hard to implement and short-lived
Officials in Berlin are reportedly mapping out industries where China is still dependent on German suppliers, as they search for the same kind of chokepoints Beijing has spent years accumulating in Europe.
But while European analysts deemed the search long overdue, some warned that any leverage it found would be both hard to use and shorter-lived than Berlin hoped.
The reported search comes amid escalating trade tensions and increasing concerns in Germany about losing its industrial base to Chinese competition.
Bloomberg reported last week that Berlin was analysing areas in which China still depends on European technology and industrial know-how. Initial findings identified Trumpf and Zeiss, both suppliers to Dutch chip-equipment maker ASML. Chip firms Siltronic, Aixtron and SUSS MicroTec could also be included.
The German ministry of economic affairs declined to comment on the report, saying the government was pursuing “targeted risk reduction” on critical dependencies on China and used “a variety of indicators” to assess them. It added that doing so required “active engagement from industry”.
Trumpf said it exported only standard products to China, and had “not been asked by the German government to disclose differentiated supply chains”.