Michael Clauss

Editor's Note:

German Chancellor Angela Merkel is about to kick start her eighth China visit later this week. What will be on the agenda? What is Germany doing to deal with the unprecedented refugee crisis? Global Times (GT) reporter Li Aixin talked to German Ambassador to China Michael Clauss (Clauss)over these issues.

GT: What topics will be discussed during Chancellor Merkel's visit this time?

Clauss: She is coming for the eighth time. She is thus among the current Western heads of state and government the one who has visited China the most, and who perhaps knows China the best.

This year has been declared the Sino-German Year of Innovation. Innovation is therefore going to be high on the agenda of the talks, including aspects such as social innovation and the rule of law.

But the core of our innovation partnership is manufacturing, in particular the German concept of "Industry 4.0" as well as the Chinese concept of "Made in China 2025." It has already been put on the agenda of German delegations visiting China and of Chinese delegations visiting Germany this year. Chancellor Merkel and Premier Li Keqiang will assess the progress made so far and discuss the next steps.

Further issues to be discussed are the state of the Chinese economy, particularly the state of reforms and of opening up the economy. Maybe the Chinese side will raise the issue of the refugee crisis in Europe. I would not be surprised if international issues are discussed as well, such as Syria and Ukraine.

GT: In what specific way do you think "Industry 4.0" and "Made in China 2025" synchronize?

Clauss: In July 2015, we signed a memorandum of understanding, which spells out the framework for our cooperation. Companies, universities, and research and development communities will cooperate on "Industry 4.0."

Second, we have already established a working group which will define standards that will be the cornerstone of our technological cooperation. There are already some German pioneering factories in China engaging in Industry 4.0-style production. They have not yet completely reached the level of 4.0, but are quite close to it. Siemens, for example, has established a factory in Chengdu, and Bosch a factory in Suzhou.

Furthermore, German and Chinese companies are already beginning to seek out partners for their respective undertakings. The Chinese company Huawei is cooperating with the German company SAP, and there will be more to follow.

The initiative is not limited to one year. It's an innovative process that is going to stretch over many years. "Made in China 2025" implies that the program aims for the next 10 years, while "Industry 4.0" is also a longer-term vision since it aims for nothing less than a revolution in manufacturing. 2015 is only the start of both programs, and respective German-Chinese cooperation formats must go on for many years to be successful.

GT: How do you think cooperation will affect ordinary people's lives?

Clauss: It will affect people's lives in many respects, definitely. At this stage we are not able to foresee all the possible consequences. "Industry 4.0" will have a tremendous impact on the way manufacturing will be done, and on what kind of qualifications will be asked of the labor force of the future.

"Industry 4.0" means the digitalization of manufacturing: It brings Internet, information technology and manufacturing together. If you look at the factories that are now - figuratively speaking - close to this ideal, you'll see very few people working in them. In the future, we expect factories and machines worldwide to communicate with another without human interference. They are going to coordinate and steer the production process, not only in one factory or in one country, but across borders.

For instance, in Germany, Mercedes-Benz has been testing trucks that drive autonomously. Their autonomous driving system is based on intelligent networking of all the safety systems already available, plus cameras, radar sensors and vehicle-to-vehicle communication. However, these as well as other technologies are still being tested to see to what extent systems could work without human interference. 

On the one hand, this means the products we buy will be cheaper, more customized to individual needs, of better quality and produced and delivered in a more energy-efficient way, thus protecting the climate. The productivity of the workforce will be higher, but education systems will have to keep up with the challenges of providing professional skills adequate for 21st century jobs.

GT: The Volkswagen (VW) emission scandal erupted a few weeks ago. What is Germany doing, or what will the country do to minimize the damage of the emission scandal?

Clauss: The emission scandal has been caused by VW, so primary responsibility for limiting and eventually reversing its negative consequences lies with the company. 11 million cars worldwide have been affected, including 2.8 million in Germany and 2,000 in China. VW will have to work hard to regain the confidence that it has lost. First of all, it will have to transparently investigate the scandal. How was it possible? What happened exactly? Why did it happen? And how can it be prevented in the future?

Second, personal consequences have to be drawn. VW is in the process of doing so. Its CEO, Martin Winterkorn, had to step down. Other members of the senior management had to resign as well.

VW will have to take care of their customers, which means they have to offer technical solutions for the cars affected, in line with the rules and laws of the countries where these cars have been sold. Within a couple of days, VW will present its first action plan.

If they succeed in doing all this, I think they have a chance to regain the confidence they have lost.

GT: Many politicians are calling for tougher border controls because of the refugee crisis. Some are worried that the Schengen Area, the border-free travel in the EU, and the European integration are facing a huge setback. Do you agree?

Clauss: Obviously, this is the biggest challenge Europe has been facing over the last couple of decades.

According to the latest figure that I have seen, more than 1 million refugees will be coming by the end of this year. That would be commensurate with around 20 million refugees coming to China. This can be illustrated, again proportionally to the Chinese population, as the emergence, within a few months, of a new city, almost as big as Beijing, packed with people who want to stay, and are not going to return to their countries of origin.

We cannot close the border. It's physically impossible. There is not much we can do to stop these people fleeing war-torn places like Syria or Libya.

Further, the open borders of the Schengen Area are one of the greatest and most directly experienced achievements of European integration, cherished by millions of, especially young, Europeans.

GT: Are there any solutions now for the tasks that you have mentioned?

Clauss: There are ways forward, but they will not be easy to implement. We have, for the time being, allocated 500 million euro to housing refugees. We have increased the number of staff for processing and deciding on asylum applications. We have implemented a lot of administrative measures to make sure there will be sufficient housing for all those people who can stay. And they will have the opportunity to learn German, the pre-condition for later being trained on a job.

All this has to be organized. And we are talking about 1 million people coming only this year. The situation will continue next year, no doubt about it. That is quite a challenge, and we are trying to keep up with the rapid pace of the developments.

GT: In the mean time, how will you conciliate people in terms of their concerns and worries brought by the refugee crisis?

Clauss: A part of German society is worried about the inflow of refugees. However, the majority of the population is very welcoming and is actively trying to help refugees. To combat fears and anxieties we have to effectively integrate those who are allowed to stay. That means they need to learn German, adapt to the way of life in Germany and find jobs. Fortunately, the influx of refugees coincides with a growing demand for young people to replenish Germany's dwindling labor force.

Over the last few decades German society has already integrated about 4 million migrants from a Muslim background. It is not always easy, but over all we have become a better, friendlier and more prosperous country because of successfully integrating foreigners. This is why we can look confidently at the current challenge.

GT: What impact will it create on Europe if the UK eventually leaves the EU?

Clauss: Europe faces several challenges: the massive inflow of refugees, the gap in competitiveness across the eurozone and the upcoming referendum in the UK next year. There are talks going on between the UK and the EU. We will see what can be done to help the UK government to win the referendum. But in the end, it's up to the people in the UK to decide.

Nobody wants to see the UK leave the EU, we would all be worse off. But the country most affected by a "Brexit" would be the UK itself.

The consequences of a "Brexit" for the UK economy, including London as a banking center, are difficult to foresee. This is why British business is one of the most prominent supporters for keeping the UK inside the EU.

The UK benefits from EU membership economically, socially and politically. I firmly believe that the lives of British citizens will not change for the better outside the EU.