‘In 2010 and 2011 half of China’s imports from the European Union came from Germany, which is up from 39 percent in 2000.’ This reinforcement of Germany’s significance as a major trading partner of China has also helped bring European business to China. The fact that Europe has not lost market share in China in the last ten years – unlike Japan and the United States – is largely thanks to Germany. Moreover, Germany is one of those few European countries to enjoy a trade surplus with China. Buoyed by the strength of trade relations built up between Beijing and Berlin, the EU therefore has no choice but to weigh up this new economic partner.

That privileged relationship, however, risks harming the relationship between China and the EU, as it is primarily a bilateral one. “The Chinese want a recovery in Europe to be led by the Germans,” writes Le Temps of Geneva. Looking at the conclusion of the study, the Geneva daily warns -

The only possible balance must be through the EU. To convince the Germans to remain good Europeans in this area, however, a strategic partnership between the EU and China must be developed, and with some urgency.

According to Polish experts, this is yet another indication that following massive investment in Africa, America and Asia, Beijing is now seriously considering expansion in Central Europe, including Poland, which may become its main partner among the “new” EU member states. But not everyone is happy about the prospect. According to the Warsaw daily -

“... some European experts believe that Beijing is deliberately undermining the EU’s role by building bilateral relations with different European countries. This weakens the EU’s cohesion in relations with China.”

And these have recently been strained. The European Commission is “trying to force” Beijing to open the Chinese public market to European companies, threatening otherwise to introduce regulations that will allow the EU to “retaliate by closing its public market” to Chinese companies.

We must face the facts. If Europe is sending Catherine Ashton, who is as eloquent as she is powerless, on reconnaissance to Teheran; if Barack Obama has, for the past few months, responded more strongly to the Israeli challenge, it is only due to the fact that the Israelis are flexing their muscles and pretending that nothing can hold them back. Had [Israel] been as cautious as most states, Teheran would have been more likely to have quick access to the bomb. [...] In case of an emergency, it is the West that will, single-handedly, take the nuclear weapons from the hands of Iran's leaders.

The impact on Chinese airlines with routes to Europe was unclear. Although the EU’s carbon scheme went into effect for airlines on January 1, Brussels has not started charging them yet. But all airlines using EU airports have been brought into the scheme. Those that do not comply face fines while persistent offenders could be banned from EU airports.

The Financial Times notes that the aviation industry “only accounts for about 3 per cent of global carbon emissions” but “the EU believes its carbon trading scheme is an important part of the fight against climate change.”

...reduce debt, reinforce control mechanisms and adopt a clear, frank and reliable position with regard to the rest of the world. […] The money China wants to invest in Europe should not be viewed as development aid but must be a successful investment. And in a best case scenario this means both from an economic and a political point of view.

From Germany’s point of view, China could play a key role with its 3.2 trillion dollars of foreign currency reserves. However, Frankfurter Rundschau points out that the People’s Republic will expect a gesture from Europe in return: for example –

EU recognition of China’s status as a market economy, which would make it more difficult for European companies to take action against unfair competition or price dumping.

As a result, Handelsblatt remarks: the Chancellor, who can claim to be the leader that the Chinese believe "has taken charge of the drive to restore the euro," had no opportunity to promote bi-lateral relations as she had planned, and will now have to wait for further meetings later in the year to extract promises from the Chinese Prime Minister.

China, it turns out, is at risk of an explosion of debt. In 2008 it initiated “a massive stimulus package equivalent to 440 billion euros that was meant to protect the country from the financial crisis triggered in the United States.” The catch: only 133 billion came from the state budget. The rest was loaned by banks, state enterprises and individuals. “Today, not just huge cities like Shanghai or Beijing but thousands of smaller cities and towns as well are deeply in debt to the state banks.”

China’s official newspaper China Daily affirms that “China cannot be Europe's saviour, nor be a cure-all for its ills, but it will do what it can to extend a helping hand as a friend. But friendship is a two-way street. China has already invested significant sums in European bonds and would like guarantees that its investment is safe.”

For the daily, the loans from countries like China, Russia and perhaps Norway and the IMF, channelled through a “Special Purpose Vehicle”, may help beef up the European Financial Stability Facility, which could get as big as two trillion euros. This solution would not have to be approved by the German Parliament, which would come as “a relief” to Angela Merkel, remarks Expansión. “Some analysts are worried”, however, “that this money would be coming from countries like China and Russia,” which could be looking for political gain, the paper concludes.

Before then, however, Angela Merkel and Wen Jiabao will have dined “at an idyllic spot on the shores of Lake Wannsee” in the German capital. Relations between Germany and China have been strained ever since Angela Merkel received the Dalai Lama on an official visit in 2007. Berlin is now hoping to establish more cordial relations with a country that is crucial to its economy. In 2010, trade between Germany and China was worth 130 billion euros.

This is a legitimate claim because the emerging countries are under-represented in international organisations. At the IMF, for example, the BRICS account 

for 11.06% of voting rights while representing 20% of global GDP. Europe accounts for 35.6% of voting rights and just over 30% of global GDP (the United States represents 16.08% of voting rights and nearly 30% of world GDP). If the voting rights/economic weight ratio is unfair to the BRICS, and if a reform is desirable, it is nevertheless true that Europe constitutes the most influential bloc within the IMF.

There is therefore no reason for Europe to give up the fight to maintain control of this very strategic post, especially at a time when several European countries have been or are still negotiating aid packages. But for this to happen Europe must, once again, speak with a single voice and propose the candidate that best defends its interests. If Europe wants to avoid having the IMF once again appear as the baleful guardian of free-market orthodoxy, it had best choose a candidate possessed of sensitivity and creativity so as to diminish, as much as possible, the bitter taste of the medicine it will have to administer.

Brussels’ excuse is that Catherine Ashton was not invited, but the Swedish paper won’t buy it: “The only thing that kept her from going to Norway was her desire to please the greatest number.” “The message is plain”, observes Dagens Nyheter: “her showing up at Oslo’s town hall would have put a serious dent in relations with China.” Representatives of all EU member states were there at the ceremony, to be sure, but she should have been there too: “In her capacity as European diplomacy chief, Catherine Ashton could easily have joined the group and shed her usual excess of caution to stand up for the rights of Liu Xiaobo. If the EU itself won’t defend the values that unite it, how can states do so in their dealings with the world’s premier dictatorship?”