Thank you for such a clear, well articulated article.
You show plainly how China's ability to plan and execute over long timelines have allowed them to maneuver into the strong position they are in.
I am worried that the West collectively isn't appreciating how significant the situation is, and how far behind we are. Even Trump who clearly made everyone take note of China's position in his first term isn't truly appreciating this.
I hope there are back channel dialogues happening between Canada, EU countries, Australia and America with other like minded nations to plan and execute better to decouple. Otherwise, in a decade, we'll all be entirely dependent on China for critical economic inputs without which our economies won't function.
One other aspect that is serious German risk is the jockeying for position for assembling China EVs in Europe. Countries like Spain, Hungary and Austria are all trying to take that business. Germany might lose their automotive role entirely.
Michael, this is a very compelling analysis, but I would frame two structural reservations.
First, your post treats China primarily as a strategic competitor, yet the empirical foundation of Sino-German economic ties has long been built on industrial complementarity and scale effects. Even under rising geopolitical tension, trade volumes, supply-chain integration, and sectoral interdependence remain material realities. A competition-centric lens may therefore underweight the cooperative dimension that continues to shape firm-level and sector-level decisions.
Second, framing German corporate exposure in China as a strategic liability risks conflating geopolitical vulnerability with commercial rationality. German firms expand in China not out of political naivety, but because China remains one of the largest end-markets and production ecosystems in the world. Capital allocation reflects expected returns and market positioning, not strategic loyalty.
The analytical question, perhaps, is not whether risk exists, but whether the relationship should be interpreted solely through a security paradigm rather than a dual framework of competition and mutual economic embeddedness.
Thank you for such a clear, well articulated article.
You show plainly how China's ability to plan and execute over long timelines have allowed them to maneuver into the strong position they are in.
I am worried that the West collectively isn't appreciating how significant the situation is, and how far behind we are. Even Trump who clearly made everyone take note of China's position in his first term isn't truly appreciating this.
I hope there are back channel dialogues happening between Canada, EU countries, Australia and America with other like minded nations to plan and execute better to decouple. Otherwise, in a decade, we'll all be entirely dependent on China for critical economic inputs without which our economies won't function.
What you are describing is the Pax Silica initiative.
One other aspect that is serious German risk is the jockeying for position for assembling China EVs in Europe. Countries like Spain, Hungary and Austria are all trying to take that business. Germany might lose their automotive role entirely.
Someone” has to take a painful road to resolve the distortions we, non-Chinese, find ourselves in. Who will it be, TROTW?
The “public”expects risks to be mitigatable to zero. Ignorance is bliss until……..kick the can until the road disappears.
Michael, this is a very compelling analysis, but I would frame two structural reservations.
First, your post treats China primarily as a strategic competitor, yet the empirical foundation of Sino-German economic ties has long been built on industrial complementarity and scale effects. Even under rising geopolitical tension, trade volumes, supply-chain integration, and sectoral interdependence remain material realities. A competition-centric lens may therefore underweight the cooperative dimension that continues to shape firm-level and sector-level decisions.
Second, framing German corporate exposure in China as a strategic liability risks conflating geopolitical vulnerability with commercial rationality. German firms expand in China not out of political naivety, but because China remains one of the largest end-markets and production ecosystems in the world. Capital allocation reflects expected returns and market positioning, not strategic loyalty.
The analytical question, perhaps, is not whether risk exists, but whether the relationship should be interpreted solely through a security paradigm rather than a dual framework of competition and mutual economic embeddedness.