Multinationals on China | Oliver Oehms: China Deserves More Than One Look

21世纪经济报道记者郑青亭、穆荣萱 北京报道

In an exclusive interview with SFC Markets & Finance, Oliver Oehms, Executive Director & Board Member of the German Chamber of Commerce in China - North China​, highlighted the remarkable progress Chinese enterprises have made in quality and innovation across the automotive, machinery and renewable‑energy sectors. 

He urged the new German administration to send a high‑level delegation to China at the earliest opportunity, recommending visits to Beijing, Shanghai and Guangzhou. “Such a mission,” he explained, “should engage not only with German companies operating here but also with the many dynamic Chinese tech firms that are evolving so swiftly.”

Referencing a recent AHK Greater China flash survey, Oehms noted that despite enduring tariff headwinds, half of German companies are still planning to increase their investments in China. He attributed this to China’s status as a major global market that continues to deliver growth. “We have been seriously looking into international and global business development, ” he said, "It is well advised to take the Chinese market seriously, to invest here, or to continue investing."

SFC Markets and Finance: Minister of Commerce Wang Wentao stated during his meeting with Hildegard Müller, President of the German Association of the Automotive Industry, that the EU's anti-subsidy case against Chinese electric vehicles should be resolved properly as soon as possible. What is your evaluation of the recent developments in the China-EU electric vehicle (EV) trade dispute?

Oliver Oehms：It's good news that both parties seem being seriously interested in finding a solution for this unfortunate situation. German industry and the German Chamber have been opposing the introduction of the tariff from day one onwards. We have been very vocal about that, because we know it's hurting not only the bilateral relations, but it's also hurting the vast interests of German automotive companies operating here in china. Therefore, whatever step is undertaken to solve this case is welcomed, appreciated by us, and whatever needs to be done by us, we are happy to do so.

SFC Markets and Finance:Broadly speaking, when trade frictions arise between China and the EU, what attitude do you expect both sides to adopt?

Oliver Oehms：It's always important to talk to each other, even though trade relations tend to be sometimes very technical, using its own language, which is only understood often at least by trade policy experts and lawyers. Personal relations do also matter. Therefore, talking to each other, sitting next to each other and talking about these sensitive topics, that's very important. 

SFC Markets and Finance: The EU has suspended its planned 25% retaliatory tariffs on U.S. goods for 90 days following President Trump's decision to pause increased tariffs. How do you assess the likelihood of a full-blown trade war between the U.S. and the EU?

Oliver Oehms：We can only speculate what's happening after the 90 days. My understanding is that it's potentially a lose-lose situation for all parties involved. It's making a life more expensive for US consumers. It's making life much more complicated for the many small and medium sized companies that are part of global supply chains. Therefore, the sooner we find a solution for that, the better for everyone, including the many Chinese companies that are doing business, either with Europe or the US market.

SFC Markets and Finance: Considering the impact of tariffs, will German companies increase their investment in the U.S. or accelerate diversification efforts?

Oliver Oehms：I'm not in a perfect position to talk about German investment in the US, but having worked in this industry for more than two decades, I've been observing how significantly the German investment stock in the United States has been developing and emerging over time. For instance, German automotive employers have been investing heavily in training US talent. So how can this increase to some extent overnight?

Therefore, I would argue that the German investment most likely has reached a certain plateau already, therefore reaching another level will take a lot of time. At least considering that the larger German companies are already active, be it in the US or in China, and that many small and medium sized companies very often don't have the capacities, be it financially or personnel wise to invest in various global markets. So therefore, I guess one is well advised to remain realistic.

SFC Markets and Finance: Based on your recent surveys, how are German companies currently engaging with the Chinese market? Are they maintaining, expanding, or reducing their presence in China?

Oliver Oehms：We see that the companies which are here in china do not have the intention to leave. The loyalty and the commitment of German companies to the chinese market is there. And this has been showed and proven by our business confidence survey end of last year. That's a very clear sign of commitment to the bilateral business relations. What we would love to see is that more new comers to look into investment and business opportunities in China. And as mentioned earlier, what really would help is having a more conducive global trade and investment climate. Having new waves of tariffs introduced by the US or then also countermeasures by global partners, this does not contribute to a more supportive investment environment.

SFC Markets and Finance: Considering the increasing labor costs in China, do you believe the country remains an attractive destination for German companies? 

Oliver Oehms：I'm not so sure about the recent wage developments. We just conducted our annual labor and and wage report, and the results are currently evaluated and analyzed. And the report will be published in July.  In general, I would say wages are one element of operational costs in any given market. We also need to take into account productivity gains, return of investment, equity investment, and also technological advancement. As far as we know, across china, there's good value for good money. So we German companies appreciate the talent which is provided by the local labor market. Therefore, one should not only look onto wage developments. The whole picture is what really matters.

SFC Markets and Finance: According to your survey, despite facing tariff challenges, half of the German companies are still trying to expand their investment in China. What are the underlying reasons for this?

Oliver Oehms：Our business confidence survey has been going more into detail, the report that we published in December last year. Therefore, we know that it's a combination of various factors. First of all, competition on the Chinese market is tough. Therefore, there is a cost reason for the deepening the value chain of German companies here in China. Secondly, anticipating future supply chain disruptions, be it coming from tariffs, logistics issues, and obviously, during the pandemic we all had a bitter lesson. And also gaining some independence as far as possible from, let's say, critical supply chain partners be the US or in Europe. These are some reasons for the fact that we still have a good number of German companies investing into the Chinese market. Last but not least it's a significant market and a market where we still see growth, also a market that excels on the global level. Therefore, we have been seriously looking into international and global business development, it is well advised to take the Chinese market seriously and obviously, but also to invest here or to continue to invest here.

SFC Markets and Finance: If we broaden the time horizon to the past 40 years, what kind of growth have Chinese enterprises achieved since China's reform and opening-up? What does the rise of Chinese companies mean for German enterprises in China? 

Oliver Oehms：Competition is out there on the Chinese market. We have the case of the automotive industry where we see Chinese manufacturers making great progress in terms of quality and technological innovation. We also see it in other sectors, machinery, renewable technology, et cetera. Therefore, it's a market that has been developing very quickly, sometimes also to the extent that it's not really and fully understood, and noticed by our partners back home in Germany and in Europe. Therefore, we, as Chamber also see our role, as a translator of these trends to our partners and friends, institutional shareholders in Germany.

SFC Markets and Finance: Today, to maintain a foothold in China's increasingly competitive market, what advice would you give to German companies?

Oliver Oehms：We like to give the advice that China is worth a look. In many cases, also the second and the third look. The pandemic, unfortunately, led in many cases to a kind of disconnect. Business travels were not possible. No trade first happening, also no inbound or less inbound travelers are traveling to Germany, participating in trade fairs. Therefore, there has been a kind of disconnect, I guess, and we try to convince our partners in Germany that now it's the time to give China a new chance, maybe a second chance as the country has been developing so quickly in the last couple of years.

SFC Markets and Finance: What do you believe is the core stance of Germany's new government on China-Germany economic relations? 

Oliver Oehms：It's obviously too early to tell. What we know is what's written in the coalition treaty. So it's a public document. And indeed, the coalition treaty is displaying a strong transatlantic message. But I think it's fair to give the new cabinet a chance. There is a significant number of new ministers some of which came also to our surprise. We should give them a chance to see what is their view on the bilateral economic relations. It's definitely our role and the role of the German Chamber back home in Germany to sit together with these new ministers, government senior government representatives, to discuss about a way forward. I see it more as an opportunity than a threat. And we understand that also our Chinese government partners are willing to engage in this journey. 

SFC Markets and Finance:What key recommendations would you make to the new administration to strengthen economic and commercial ties between China and Germany?

I have a very simple advice to them: come here to Beijing, Shanghai, and Guangzhou, and see what the new China is all about. Have an engagement, not only with the Germans operating here in china, but also the many fascinating Chinese tech companies developing so quickly.

SFC Markets and Finance: In short, can bilateral trade and investment between the two countries expand further?

Oliver Oehms：It can expand. I'm always careful to concentrate on the trade figures, especially trading goods. One should not exclude trade in services, first of all. Secondly, we also need to complete the picture, also to analyze investment flows, the engagement, for instance, of german companies investing in China and vice versa. If you ask me, where would I see the biggest potential? It's definitely Chinese potential, Chinese investment in Germany.

Chief Producer: Yu Xiaona

Supervising Producer: Shi Shi

Editor: Li Yinong, He Jia

Reporter: Zheng Qingting, Mu Rongxuan

Video Editor: Cai Yutian

New Media Coordination: Ding Qingyun, Zeng Tingfang, Lai Xi, Huang Daxun

Overseas Operations Supervising Producer: Huang Yanshu

Overseas Content Coordinator: Huang Zihao

Overseas Operations Editors: Zhuang Huan, Wu Wanjie, Long Lihua, Zhang Weitao

Produced by: Southern Finance Omnimedia Group

瑞银胡凌寒答21：投资者基础及融资便利性是A股公司赴港上市主因

猜你喜欢