Germany Inc thrives in China even as Trump trade war escalates

(Oct 12): When Sabine Herold opened a new Shanghai facility in September, the milestone for her tiny Bavarian glue maker was the culmination of 14 years of careful development — and a sign of how deep and wide commercial ties between Germany and China have become.

Piling into China with Bosch drills, Mercedes-Benz cars and Siemens turbines has made the Asian country Germany’s largest business partner for the past two years. Total trade between the two reached US$179 billion ($246 billion) in 2017, double the UK’s level and triple that of France. Germany’s special status became clear in July, when BASF SE announced a US$10 billion plant in Guangdong province — the first large manufacturing site in China entirely owned by a foreign chemicals maker. Now, BMW AG is plowing US$4.1 billion into its Chinese joint venture, taking advantage of a new policy to let foreign companies take majority control of their local partnerships.

“The development in China is so unbelievably fast,” said Herold, managing partner and part owner of Delo Industrie Klebstoffe GmbH, which makes specialty adhesives for smart cards, automotive sensors, and mobile-phone speakers and needs to carefully choose its niches as it vies with giants like DowDuPont Inc, 3M Corp. and Henkel AG.

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