STEVE INSKEEP, HOST:
Let's talk this through with Jeff Rathke, formerly with the U.S. State Department and now president of the American Institute for Contemporary German Studies at Johns Hopkins. Welcome to the program.
JEFF RATHKE: Good morning, Steve.
INSKEEP: I want to work through a couple of issues here, and one of them is just the effort to keep China out of the war in Ukraine, keep China from sending weapons to Russia for its invasion of Ukraine. Do you think the two leaders agree on how to approach that?
RATHKE: I think they do broadly because they both see the enormous risks if China were to escalate by providing weapons to Russia. And the United States and Europe, let's remember, have been in lockstep on their sanctions approach to Russia since the invasion began. And so I think that's going to be a central part of what they need to plan for, is what steps the United States and the European Union can take in order to deter China from contemplating or taking that step.
INSKEEP: OK. So that feels kind of urgent because the United States has been issuing these warnings the same way that once upon a time they were warning that Russia was about to invade Ukraine. They seem to be making these same warnings about China's next action. But there is a larger issue here I want to ask about, and that is the U.S. approach to China generally. As we've been reporting, there's a bipartisan consensus in the United States that engagement with China hasn't worked, that the United States needs a much tougher approach to China. Does Germany join that consensus?
RATHKE: There's growing concern in Germany about their exposure to China economically and that that could have strategic implications. There's no doubt about that. And you see this across mainstream German political parties. But let's also keep in mind, I think as your conversation with Rob Schmitz pointed out, Germany is the largest European economy. The - it's a trade-dependent economy, and China is its biggest trading partner. And by the way, the United States had $527 billion in imports from China last year. So there's also a U.S. economic exposure that just means you need to think these things through carefully if you want to rebalance that relationship.
INSKEEP: I'm thinking through carefully the differences between U.S. trade with China and German trade with China. The U.S. of course sells stuff in China, but as you just pointed out with that huge number of imports, what's mainly happening with the United States is that the United States is manufacturing things in China that then get brought back to the United States. The U.S. and its companies can find other places to do some of that. They're in fact in the process of finding other places to manufacture things. But it sounds like Germany, to a greater extent, is profiting by selling things to China. They need access to that market. Do they need China more?
RATHKE: They need it in a slightly different way. But I think it's worth pointing out, you know, Germany also has a trade deficit with China now and has for a couple of years. So what you see is sector by sector - the automobile industry, the chemicals industry, the engineering industry - they do great business with China, they export to China, and they are heavily invested there. For all the other German economic actors, they face these same questions about resilient supply chains, about redundancy and all the things that have been exposed not only by the COVID-19 pandemic, but also by China's growing assertiveness and aspirations to shape the global economy.
INSKEEP: In the last year, Germany has reached the moment of realizing they can't depend on Russian energy anymore, that that is too much of a strategic risk. It sounds like they're not quite there, but approaching the idea that their trade with China may also be a strategic risk they can't depend on so much anymore.
RATHKE: Germany has already taken some steps in this direction. For example, they've placed some new limits on export credit insurance, foreign investment insurance, sending a signal to the German economy that if they increase their exposure to the Chinese economy, they increasingly will do so at their own risk. And so this is about, you know, turning the aircraft carrier, so to speak, in preserving the economic relationships, but making sure they adapt in changing circumstances. That balance is what Germany is always striving for and I think will be on the chancellor's mind when he talks about China with President Biden today.
INSKEEP: Do you think these two leaders broadly understand each other, get each other?
RATHKE: I think so. I think they really depend on each other. And you see that the way President Biden approached the tank issue with Germany, and you see it in also the way that Chancellor Scholz has focused on the U.S. relationship since the war in Ukraine.
INSKEEP: Jeff Rathke of the American Institute for Contemporary German Studies at Johns Hopkins, thanks so much.
RATHKE: Pleasure. Transcript provided by NPR, Copyright NPR.