Opinion: China will soon "gnaw" the entire German industry

China has become a serious threat not only to VW and Mercedes — the German chemical and engineering industries are also being attacked by Chinese competitors. The publication informs about this Gazeta.Pl .

The German industrial base is facing an unprecedented challenge. Germany, once a leader in high-tech manufacturing, has faced a decline in industrial production over the past five years. This puts at risk the preservation of up to 5.5 million jobs and 20% of employment in the country.

Germany has already reduced purchases of Russian oil and gas, which has led to a sharp increase in energy prices and caused serious damage to industrial sectors, including the chemical and steel industries. In addition, disruptions in the supply chain after the pandemic led to a decrease in demand for German exports.

Another important factor is China's rapid transition from low-value-added manufacturing to high-tech and innovative industries. This is the Communist Party's "Made in China 2025" strategy aimed at achieving world leadership in advanced manufacturing and technology.

Germany did not benefit much from the initial economic growth of China at the beginning of the 21st century. At that time, Chinese production was focused on the production of low-tech electronics, household appliances and textiles. Today, Beijing's industrial policy is focused on key sectors for Germany, including automotive, clean technology and mechanical engineering.

"China has caught up with the United States in a number of advanced industries. They are very strong in these areas... and this contributes to Germany's weak economic growth," admits Professor Holger Gerg, head of the foreign trade and investment research group at the German Institute for World Economy (IfW) in Cologne.

The speed at which China has caught up with Germany is perhaps most noticeable in the automotive industry. German automakers have been criticized for their lack of innovation, slow transition to electric vehicles and inability to cope with the growing fierce competition from Chinese brands such as SAIC Motor and BYD. These problems have led to the threat of tens of thousands of layoffs and to the real closure of German factories.