Published by: World Tibet Network News, Tuesday, July 2, 1996

By Robert Koenig, The Journal of Commerce

Knight-Ridder/Tribune Business News

BERLIN--July 2, 1996--GERMANY'S CHINA CHILL: When German Chancellor Helmut Kohl visited China last fall, his agenda clearly was commercial rights rather than human rights. After all, the planeload of German industrialists who accompanied Mr. Kohl nailed down at least a dozen big business deals. And the Chinese, coddled by a remarkably docile Mr. Kohl, were rewarded with mammoth German investments.

In the midst of that business feeding frenzy, Mr. Kohl agreed to inspect a Chinese infantry division. He was the first Western leader to do so since units of that army massacred Chinese dissidents near Tiananmen Square in 1989.

Mr. Kohl's symbolic inspection was the low point in what critics describe as the chancellor's essentially amoral policy toward the Chinese -- a policy that helped German businesses take advantage when U.S.

-- Chinese commercial relations soured over copyright piracy and other disputes.

But last week, the tables turned, at least for the moment. Chinese leaders, irked by a German parliamentary resolution questioning China's human-rights record in Tibet, revoked their invitation to German Foreign Minister Klaus Kinkel to visit China this month. In response, three other German cabinet members canceled their planned visits to China.

Seizing on Beijing's insult, Germany's opposition Social Democrats lambasted Mr. Kohl for giving China the impression that Germany was so focused on business ties that it was willing to ignore China's deplorable human-rights record. And Mr. Kohl, in an about-face, showed up at a legislative debate last week to defend the Bundestag's right to criticize China's record, and to defend his own stance toward the world's most populous nation.

Mr. Kohl argued that Germany's economic initiatives aimed ``to support China's opening to the world.'' But Social Democratic foreign policy spokesman Guenter Verheugen asserted that Germany's ``constant yielding to Chinese pressure has led China's leaders to assume the government is only interested in business.''

To be specific, big business. There's the German chemical giant BASF AG, the No. 1 foreign investor in China's chemical industry, which is building a $4 billion chemical plant there and hopes to double sales in China by 2000. Then there's Volkswagen AG, Germany's largest automaker, which has invested heavily in China and has a big share of the auto market there. And Siemens AG, the German electronics conglomerate that has a four-year, $3.3 billion expansion plan in Asia that focuses mainly on China.

Meanwhile, German ports and shipping lines also stand to gain from increased commerce with China. This spring, Hamburg Mayor Henning Voscherau visited Hamburg's sister port of Shanghai to emphasize their commercial ties.

Last year alone, ships transported 1.4 million tons of cargo between Hamburg and Shanghai. Hamburg-Hong Kong business totaled 3.3 million tons. More than 800 Hamburg-based companies are involved in trade with China, and Hamburg has become China's foreign-trade center for western Europe. With all those commercial ties, and German-Chinese trade that totaled $17.5 billion last year, it is no wonder German business leaders were edgy about last week's mild diplomatic contretemps.

So far, however, the temporary chill in Chinese-German relations has had no direct impact on commerce between the two nations, and there are signs the two sides will patch things up soon. Chinese President Jiang Zemin sent a telegram to reiterate China's invitation to German President Roman Herzog to visit this fall. And Germany's research minister, Juergen Ruettgers, may show up in Beijing this month to open a new German science and technology office there.

Meanwhile, prominent German business leaders are working behind the scenes to try to smooth ruffled feathers. They contend the best lever to influence Chinese policy is economics, not polemics.

Maybe so. But it didn't help to send a signal to China last fall that American and European attitudes differ on fundamental issues of human rights and copyright piracy. For, up until last week, the Germans had been content to let the United States stand up to China on those issues and reap the benefits of Beijing's policy of playing off the Europeans against the Americans.

The Chinese picked on Mr. Kinkel last week partly because his Free Democratic Party's foundation recently sponsored a Tibet conference featuring the Dalai Lama, who leads Tibet's government-in-exile. That's hardly a sin peculiar to Germany.

When Mr. Jiang visited Bavaria last summer, local police seized a protester's sign proclaiming: ``No Business Deals With Murderers.'' The anti-Jiang placard, it seems, broke a German law against publicly insulting foreign dignitaries.

Mr. Jiang and his cohorts should take that hint now, and stop insulting Mr. Kinkel and other Western officials who express legitimate criticism of Chinese policies.

Robert Koenig writes for The Journal of Commerce from Germany.