DOCUMENTATION 2008

THE HAMBURG SUMMITChina meets Europe

10 to 12 September 2008

Hamburg Chamber of Commerce

www.hamburg-summit.com

32

Imprint:HAMBURG CHAMBER OF COMMERCEInternational DepartmentJens AssmannAdolphsplatz 1 · 20457 Hamburg · Germany

Phone: +49 40 361 38 -287Fax: +49 40 361 38 -494E-Mail: jens.assmann@hk24.dewww.hamburg-summit.com

Design: zwei:c werbeagentur GmbH, Hamburgwww.zwei-c.comPhotos: R. Magunia, K. Angerer

Chinese Translation and Type Setting: Dr. Boesken & Partner GmbH, Hamburg Circulation: 2.000 copies

Gold Sponsors

Supporters

Partners

Media Partners

Exclusive Sponsor

Initiator & Organiser

Co-Host Summit Partners

Official Media Partners Supporting Media Partner

Academic Partners

18 Opening up, but Slowly and Carefully

20 No Alternative to Integration

22 Climate Change is a Wake-up Call

24 The Driving Force of Innovation

26 Cooperation is on the Agenda

28 A Strategy for Energy and Raw Materials

30 Huge Bottlenecks inDomestic Transport

32 Looking Forward to a Period of Innovations

34 Europeans should be Visible and Present

36 Two Awards for a Better Understanding

38 Ways to solve Upcoming Problems

40 Views on the Hamburg Summit

41 Quotes

43 Hamburg Summit Speakers

Sponsors and Partners Table of Contents

04 Welcome Address byPresident Frank Horch

06 Partners, not Rivals

08 A Constructive Working Relationship

10 On the Way to becoming a World Power

12 Large Differences in Markets and Policies

14 A Shift towards Domestic Consumption

16 Not the Deficit itself, but the Level

54

Real optimists are enviable people –they enter a restaurant and order

oysters hoping to find a pearl insidethat helps to pay the bill. I think itwould be a good idea to adopt thisrefreshing kind of optimism for thethird “Hamburg Summit: China meetsEurope” held at the Hamburg Chamberof Commerce. The programme was fullof pearls – with each new topic weopened, beautiful pearls were to bediscovered!

When the former President of ourChamber, Dr. Karl-Joachim Dreyer,officially opened the first HamburgSummit in 2004, he said: “What weneed in business as well as politics aregood marriages that are long lastingand dependable. People say that themost successful marriages are those inwhich the couple never stops talking.”In November 2004 we could not haveimagined how important a constantdialogue between China and Europe

would be just four years later. Especiallysince 2007 the couple has had to facedifficult conditions.

But separation would never help toreturn to a state of harmony, so we aremore than happy that we arranged thethird “Hamburg Summit: China meetsEurope” against the odds. Our constantdialogue with the economic and politi-cal leaders in China has been rewarded:The Hamburg Summit was the reasonfor the first visit of a high-rankingChinese politician in Europe followingthe political disagreement in spring2008. And this will also play a part inreinstating harmony, which goesbeyond all of the expectations we hadwhen planning the Hamburg Summit in2004 that carried the motto “The powerof partnership”.

The China we see today is no longerthe workbench of the world, it hasemerged as a global player of hightechnology. The EU needs to accept andtreat the People’s Republic as an equalpartner. China, on the other hand, needsto continue implementing WTO rulesand regulations. There is still someground to cover in this respect.

To generate fair dialogue, theHamburg Chamber of Commerce initi-ated “The Hamburg Summit: Chinameets Europe”. I am very confident thatwe will strengthen the dialogue withthe aim of building new bridges andreviving existing links. The stronger abridge is built, the more it can carry. Letus all contribute in building a bridgebetween China and Europe – a bridgethat can carry common challenges suchas climate change and environmentalproblems! <<

Frank Horch, President, Hamburg Chamber of Commerce, opens the conference

Deputy Prime Minister Zhang Dejiang (left) is greeted by President HorchDeputy Chancellor Steinmeier (middle) in a relaxed talk with the Conference Chairmen

Welcome Address by President Frank Horch

76

The visit by China’s Deputy PrimeMinister, Zhang Dejiang, was a clear

sign that troubled political relationsbetween Germany and China are slowlyreturning to normal. “Only by joininghands can we resolve the major problems”,the high-ranking politician emphasisedduring his speech at the Hamburg Summit.

2008 has proven to be a year withmajor challenges for China. The earth-quake in Sichuan province in May “wasthe worst natural catastrophe since thefounding of the People’s Republic”, saidZhang. Life in the area has sincereturned to normal, and reconstructionwork is already in progress. Zhangthanked Germany and Europe for thevaluable aid provided.

2008 was also the year in which theOlympic and Paralympic Games wereheld in Beijing. “The Games were extraor-dinary, and a huge success”, said Zhang,“as they not only offered an opportunityto strengthen friendships, they also

proved that China has made the movefrom a Communist planned economy toa market economy in the almost 60 yearssince the founding of the state.”

In Zhang’s opinion, economic devel-opment has led to major progress forChina’s population, although it stillremains a developing country. Rapideconomic growth is causing major con-cerns in terms of inefficient capacitieson the one hand and serious environ-mental issues on the other. However,Zhand is convinced that China shouldbe a moderately prosperous society by2020, as “we are confident that China’seconomy will continue to grow.”

“But China cannot develop withoutthe rest of the world and vice versa”, hepointed out, before adding that “Chinais your partner, not your rival.” This wasdirected in particular at the country’spartnership with Europe, which hasdeveloped well. After all, the EU isChina’s main trade partner and China

the EU’s second-largest trade partner.“Whether energy efficiency, environ-mental protection or infrastructure, Iam sure that cooperation in these fieldswill create great opportunities for yourcompanies”, Zhang promised.

Germany’s Minister for Foreign Affairs,Dr. Frank-Walter Steinmeier, linked thecall for cooperation with a daringvision: “We need a 21st century SilkRoad.” As early as 5,000 years ago, thislink between China and Western Europenot only generated affluence throughinternational trade; its golden age wasalso one of the most liberal and peace-ful periods that China has experienced.

Today’s Silk Roads – sea, aviation andrail transport – similarly not only help topromote affluence. They also bring peo-ple together, allow contacts to be made,and facilitate the exchange of informa-tion. Steinmeier said: “We need to usethis, not just as a driving force for theeconomy, but as an impulse to mod-ernise and open up our societies.”

We live in an age of major changes,Steinmeier emphasised and pointed outthat new political and economic powercentres are emerging, primarily in China.“The world is looking for a new constel-lation, and without dialogue withemerging economies we will not attainthis new organisation”, the GermanMinister for Foreign Affairs explained tothe audience at the Hamburg Summit.

There is nowhere else more awarenessof this than in the city of Hamburg,Steinmeier said, “as a port is a gatewayto the world.” The new century’s flow ofgoods and ideas will shape our perceptionof the world. “And when I speak ofmodernisation and openness”, Steinmeiersaid, “then I also mean openness formore global responsibility.” <<

Deputy Chancellor Steinmeier (left) and Deputy Prime Minister Zhang Dejiang

Frank-Walter Steinmeier gives his opening speech atthe Hamburg Chamber of CommerceHandshake between Germany and China after the signing of the Golden Book

Partners, not Rivals

98

Hamburg’s First Mayor, Ole von Beust,is convinced that the eyes of the

world are now focussed even more onChina since the Olympic Games wereheld in Beijing. “Many people inHamburg are learning Chinese and itswriting system, are enjoying Chinesecuisine or are being treated accordingto the principles of Chinese medicine”,he reported during his welcomingspeech at the “Hamburg Summit: Chinameets Europe”. People want to knowabout everyday life in China – they arefollowing its governmental policies andare posing critical questions as tohuman rights or freedom of speech.

This increased interest is not particu-larly surprising in Hamburg, as it hasalways maintained strong relations withChina. “Hamburg is proud of its links toChina, that go back centuries and proudthat this relationship is being continuedand developed in the 21st century aswell”, said von Beust.

The city has a lot to offer when itcomes to environmental protection, themain focus of discussion at the thirdHamburg Summit. In addition to key sec-tors such as aviation and the maritimeindustry, it is also the home of leadingenvironmental technology and renew-able energy producers. Environmentalprotection and energy supply are two ofthe main challenges that China faces inits development towards becoming aleading economic nation. For this reasonvon Beust hopes that “understanding ofChina in Europe will continue to grow –and vice versa, of course.”

László Kovács, the Hungarian EU-Commissioner for Taxation and CustomsUnion, has visited China on numerous

occasions. He considers this a necessity,as the European Union and China areboth major players in rapidly-growinginternational commerce. For this reasonboth parties need to assume responsibilityfor the international community. Kovács:“Consequently there is an imperious needto build and sustain a constructive work-ing relationship in order to secure energysupplies, to slow down the global warm-ing to settle or prevent local conflicts,and to combat international terrorism.“

The EU-Commissioner thanked thegovernment in Beijing for its efforts intrying to solve major economic, ecologicaland social problems. He stressed thatthe international community needsChina as a responsible and thereforerespected member, especially within thescope of fast-growing trade relations.“The intense competitive pressure onparts of the European economy requiresthat we continue to persuade China totrade fairly and open its markets so thatour companies can compete on a levelplaying field”, Kovács said.

In order to achieve this, a number ofreforms are required - from investmentconditions to the development of finan-cial markets or the protection ofIntellectual Property Rights. TheCommissioner explained that counter-feiting is a complex issue, a legal offenceas well as a financial and economicproblem. “As major trade partners it is inthe interest of both the EU and China tofacilitate legitimate trade whilst ensur-ing the safety and security of citizens”,Kovács claimed. But, he added, “we areaware that China cannot be treated like aschoolmaster treats his students. It canonly be treated as a partner on the basis

of shared interests and mutual respect.”The Hamburg Summit is a vital platformfor fostering such a partnership, addedXie Qihua, Executive Chairwoman of the China Federation of IndustrialEconomics and former Chairwoman ofBaosteel. “It is our sincere hope thatwith the cooperation between theChinese and German industrial andcommercial organisations we will beable to generate substantial profits forthe people of our two countries”, Xiesaid. <<

Xie Qihua, CFIE, greets the audience

Hamburg’s First Mayor Ole von Beust

EU-Commissioner László Kovács emphasises the spirit of partnership

A Constructive Working Relationship

1110

F ormer German Chancellor HelmutSchmidt was nearly 90 years old

when he addressed the participants ofthe Hamburg Summit and added a fewpersonal memories. His account goesback to the 1960’s when he read aboutthe cultural revolution in China. At thattime he only had a rather vague idea ofChina’s four or five thousand years ofhistory. But he began to read aboutChina and, because he could not visitthe country as German defence minister,he looked at China when he was inBangkok, Seoul, Sydney or Wellington.“When I returned to Germany I under-stood that China was on its way tobecoming a world power again as well avital trading and shipping partner forus”, Schmidt continued.

“Most Europeans and North Americanshave little knowledge of China and itshistory”, Schmidt said. He believes thateven the last couple of centuries arelargely grey areas for political leadersand business managers. They have heardabout the Great Wall of China orConfucius, but they are not aware of the

fact that China was superior to Europe inthe sciences and all civilisational tech-nologies during the European MiddleAges. “This absence of knowledge is oneof several reasons for the lack of respectfor China among Western cultures”, theformer German chancellor pointed out.

The French Minister of State to theMinister for the Economy, Anne MarieIdrac, also stressed the need for mutualtrust. “Partnership is the key word forour relationship”, she said and added“mutual fairness should be the basis.”

The economic and social aspects ofChina’s future are of huge importancefor all of mankind, Idrac and Schmidtagreed. The enormous economic success,initiated by Deng Xiaoping’s pragmaticreforms, has turned China into a decisivefactor for the world economy. And thecountry is not only becoming an indus-trial heavyweight, but it is also on its wayto becoming a major financial power.

“What conclusion can we draw fromall of these facts?”, Schmidt asked beforeproviding an immediate answer: “Wehave to urge our governments to main-

tain peace, solid and healthy global mar-kets, and therefore mutual cooperation.”

This is a move supported by JiangYiren, Chairman of the Shanghai Fed-eration of Industrial Economics andmember of the Standing Committee.“We need to continue to develop ourcooperation in a balanced manner”, hesaid. Trade relations between theEuropean Union and China havedeveloped well in the last few years, andin 2004 the EU overtook the USA asChina’s main trade partner. Conversely,China is the EU’s second-largestpartner, with the EU being China’sfourth-largest investor, Jiang added.

Jiang’s home town of Shanghai is agood example of positive development.It is the main location for investors fromthe EU and home to various Europeancompanies’ head offices. And Jiangleaves no doubt that they are more thanwelcome there: “We see healthy devel-opment between Europe and China, andwe would be more than happy for youto invest in China, especially inShanghai”, he told the audience. <<

Former German Chancellor Helmut Schmidt is one of the Hamburg Summit’s Honorary Chairmen Jiang Yiren, CFIE, gives an overview about the Sino-European relations Anne Marie Idrac, French Minister of State to the Minister for the Economy

On the Way to becoming a World Power

1312

China’s awakening after a century ofagony is one of the main political

events of the last few decades, believesMichel Rocard, former French PrimeMinister and current member of the Euro-pean Parliament. “We have to thank DengXiaoping for awakening the country”,he said. Rocard first visited Guandongprovince in 1992 where as many peoplelive as in the whole of France, and headmires what China has done since firstvisiting the area. “It is a major accom-plishment to make so much progress inonly twenty or thirty years”, Rocard said.

To secure this progress in the future,“we need to listen to, and understand,one another”, he added, and alsoexpressed his approval of the HamburgSummit in offering precisely the rightplatform to enable this exchange. Withseveral forums in both China andEurope and a number of workshops, theEuropean Parliament is making efforts“to encourage mutual understanding”.

Professor Lucas Papademos, Vice-President of the European Central Bank,emphasised the importance of the

continual interchange of ideas duringhis keynote speech at the HamburgSummit. “Increasing trade with Chinahas clearly brought major benefits forEurope”, he explained, and asked at thesame time: “So why do we Europeansoccasionally express concern about theexpanding trade and, more generally,the economic ties between the EU andChina?” In his opinion there are certain“asymmetries” characterising trade rela-tions between the EU and China.

The value of EU imports from Chinaamounted to 231 billion euros in 2007,with the EU’s exports to China reachingalmost 72 billion euros, i.e. less than onethird of the import value. “Why doesEurope not export more products likehigh value-added goods, pharmaceuti-cals or machinery where it has a compar-ative advantage over China?” the bankerfrom Greece asked. The reasons for thisinclude, for instance, non-tariff barriersin China or the bilateral exchange rate.More generally, there are large differ-ences in how the markets and economicand monetary policies work in both areas.

So there are different tasks to betackled while the world economy is navi-gating choppy seas - Europe has tofocus on labour and product marketreforms to enhance its growth potential.China, on the other hand, needs to reformits financial markets and banking sectorin order to improve monetary control.

This is the path towards sustainableeconomic growth and in order to mutu-ally benefit from trade - not only forChina and the EU but also for otherregions like the Middle East. H.E.Sheikha Lubna Al Qasimi, Minister ofForeign Trade in the United ArabEmirates, announced to the audience inHamburg: “We aim to be an importantlink between East and West.”

After all, the EU is one of the world’slargest industrialised regions, and Chinais home to the 500 largest companies inthe world. Trade with the Emirates is alsocurrently experiencing dynamic growth,as China’s energy requirements has madeoil a key trade product, while the Emirateshave emerged as the largest market forChinese products in the Middle East. <<

Michel Rocard, former Prime Minister of France Lucas D. Papademos, European Central Bank

H.E. Sheikha Lubna Al Qasimi, UAE Minister of Foreign Trade, introduces the UAE as an important link between the EU and China

Large Differences in Markets and Policies

1514

Ronnie C. Chan, Chairman of theHang Lung Group, a leading Hong

Kong property developer, provided a verycasual answer to the question ofwhether China’s growth is unlimited bysaying “I’ve got no idea, but it will be allright over the next few years. I aminvesting, and the return on investmentis really good”. In the process, it is vitalthat the population tales a long termview and provides for the nextgeneration, following the precepts ofConfucius.

The businessman also sees twomajor challenges for the country, how-ever. Oil and raw material supplies willbecoming increasingly difficult toobtain, due to the rapid growth,spiralling prices and increased interna-tional competition, which could in turnlead to serious international conflicts.China will also face not only ecological,but also huge social problems, largelydue to millions of people migratingfrom within the country to the south-eastern coastal regions. Chan added, “Ifwe solve the social problems, then the

economy will continue to see stronggrowth.”

The background for this forecast isfairly simple: China’s economy has bene-fited in the last few years from strongexports, and, generally speaking, fromglobalisation. “But further strong growthwill endanger jobs in the EU”, MichelRocard, former Prime Minister of Franceand member of the European Parliament,warned. Rocard explained that “thecapacity to absorb Chinese exports in theEU will not correlate with the Chinesepossibilities to export.” For this reason itis vital that domestic demand in China isramped up.

Chan is very optimistic in this regard,as “consumption in China will grow by20 to 30 per cent annually”, he predict-ed. Most of the panellists agreed with him, including Dr. Ulrich Weber,Manager at Airbus: “We are quite confi-dent that in the long term there is ahuge market for aircraft.” Increasingincomes means that more and morepeople will be using aircraft for businessor private trips.

Dr. Richard Hausmann, President andCEO of Siemens in China and Chairmanof the German Chamber of Commerce inChina, foresees growing import demand,due to the major infrastructure prob-lems. “China was once seen as a sourceof cheap labour. But most products soldby Siemens in China originate fromGerman and European plants.”

One requirement for increasingdomestic consumption and imports is amore flexible monetary policy, permittingfurther upvaluation of the renminbi.“China has to manage the currency issueand the government needs to increase itsflexibility”, David Tak-kei Sun, ManagingPartner at the consulting firm Ernst &Young in Hong Kong, stressed. Businessesoffering products to meet local demandshould also receive support from thelocal government. The panel agreed withthe conclusion provided by moderatorSteffen Klusmann, Editor-in-Chief atFinancial Times Deutschland: China’slong-term prospects remain quite solid,but there will be a shift towards domesticconsumption. <<

Ronnie C. Chan (right), Hang Lung Group, analyses China’s potential for further growth

David Tak-kei Sun, Ernst & Young Far East Area, Richard Hausmann, Siemens Ltd. (China), Michel Rocard, Ulrich Weber, Airbus (f.l.t.r)

A Shift towards Domestic Consumption

1716

While Sino-European trade volumescontinue to grow at double-digit

rates, Europe continues to run anenormous trade deficit which may leadto new trade barriers appearing on bothsides. In 2007 the EU’s trade deficit withChina was 160 billion euros, accountingfor 86 per cent of the EU’s total tradedeficit. The EU exports more to Switzer-land, with only 7.5 million people, than itdoes to China, one of the participants atthe Hamburg Summit told the auditorium.“And there is a tendency to movetowards more protection”, John Thornhill,European Editor of Financial Times,noted. This is why the question rises: Isthere a recipe for mutually beneficial EU-China trade relations?

“Of course there are a lot of prob-lems when trading with China”, saidDavid O’Sullivan, Director General of theDirectorate General Trade of theEuropean Commission. But there arealso problems when trading with theUSA, he noted, and: “It is not surprisingwhen there are trading problems.”.Nevertheless, he still agreed with Anne

Marie Idrac, Minister of State to theMinister for the Economy, when shesaid that “It is not the deficit itself, butthe level. It must be a situation that wecan explain, understand and accept.”And Lt. General Daniel Christman,Senior Vice President of the USChamber of Commerce, pointed outthat, “above and beyond the economicaspects, such trade surpluses alsocreate political instability.”

Jack C.K. So, Chairman of Hong KongTrade Development Council, tried toexplain the unbalanced situation.“Chinese exports contain a lot of ele-ments from other countries”, So pointedout and added that “many Europeancountries have introduced China to theirproduction chain”. And China’s marketshave opened up to become the world’slargest consumer market after the USA,with “Hong Kong as the shop windowfor products from Europe, where everyChinese person can come and shop.”

Apart from such clarification attempts,all of the panel participants agreed thatthe only way of solving the problems in

the long term is through close coopera-tion. “We believe that China needs to beintegrated within the internationalprocess”, Lt. General Christman empha-sised. The WTO is the organisation withinwhich the new world order can be forged.It’s not about achieving perfect results,it’s about demonstrating that compro-mises can be made. O’Sullivan said: “Wedon’t need a perfect balance, but anindication that the Chinese recognize theproblem and intend to tackle it.” But JörgWuttke, Head of BASF in China andPresident of the European UnionChamber of Commerce in China, remainssceptical - “China has failed to engage inthe Doha round and is yet to communi-cate its aims”, he said.

Europeans and Americans bothcomplained about the lack of protectionof Intellectual Property Rights. “There iscertainly a willingness and there hasalso been progress in the rightdirection”, Wuttke declared, “but wehave not seen movement for a longtime.” He also added that “We need tomake progress in this area.” <<

Anne Marie Idrac, John Thornhill, Financial Times, Daniel Christman, US Chamber of Commerce (f.l.t.r) Jack C.K. So, HKTDC, David O’Sullivan, European Commission, Jörg Wuttke, BASF SE (f.l.t.r.)

Not the Deficit itself, but the Level

1918

China has made enormous progressin terms of liberalising its banking

system. A short retrospect may help toillustrate this: Until 1996, China had nocentral bank; the People’s Bank of Chinawas a commercial bank. All financialinstitutions were packed with bad loans,and China’s banks were way behind.Now the four biggest banks in the worldare Chinese, which are investing abroadand, above all, Chinese consolidatedfunds are investing increasingly inEurope. But the question is: How stableis the system? How strongly is it affectedby the international financial crisis?

“Being big does not necessarily meanbeing strong and healthy”, said RonnieC. Chan, Chairman of the Hang LungGroup, a real-estate developer in HongKong. They are really behind in terms ofrisk management and technology. AndProfessor Norbert Walter, ChiefEconomist at Deutsche Bank AG, knowsthe reason why: “If you are only inter-ested in liquid money and state bondsfor years on end, it takes more than afew months to learn handling risks.”

There has been no doubt a lot ofimprovement among Chinese banks,

particularly in handling bad loans. “Ifyou look at the numbers it looks quitegood”, explained Professor Xie Danyang,economist at the Hong Kong Universityof Science and Technology. But hethinks that one has to look at thenumbers with some doubt as they havealways been dressed up. However,politicians are no longer in a position topush for loans that are subsequentlydishonoured. Professor Xie added that“by and large we are moving in the rightdirection, commercial banks are respon-sible for themselves”.

Nevertheless Peter Rieck, DeputyChief Executive Officer at HSH NordbankAG, pointed out that “it is not a liberalmarket place, we need to wait severalyears for that to happen”, which RonnieChan considers perfectly normal: “Wekeep getting criticised due to the influ-ence of the state, but look at Fanny Maeand Freddy Mac!” The major mortgagefinancers were both nationalised by theUS government during the credit crisis.And Professor Norbert Walter provided aresponse to the question asked by mod-erator Matthias Nass, Deputy Editor-in-Chief of the German weekly “Die Zeit”, as

to whether a Chinese bank could takeover a German one: “You’d have to askGerman Chancellor Angela Merkel.” Chanalso added that there are also lots ofstate-run businesses in Singapore thatare 98 per cent market-driven. “But theyhave obligations vis-à-vis society – thisis also the case in China.”

Since the international financialcrisis erupted, China’s financial sectorhas become part of its national security,Chan said. During the Asia crisis in themid 1990s, China’s government did anexcellent job and succeeded in stabilisingthe region. This is again the case, asmany Asian banks have thus hadnothing to do with the US sub-primemarket. “The reason for this is quitesimple”, Chan said, “they are doing goodbusiness in the domestic market and donot need such alternatives.”

The Asian members of the “Bankingand financial activities between the EUand China” panel are convinced thatChinese banks are healthy and able tomaintain their course. Chan added that“China knows that it needs to open up, but it needs to do so slowly andcarefully.” <<

Norbert Walter, Deutsche Bank AG, andRonnie C. Chan discuss the situation ofChina’s financial market (f.l.t.r)

Peter Rieck, HSH Nordbank AG, Xie Danyang, The Hong Kong University of Science and Technology (f.l.t.r.)

Opening up, but Slowly and Carefully

2120

C hina’s success-story meanwhile iswell-known, but other nations are

following, foremost India with its hugepopulation and comparable growthrates. The question is how will the EUand the USA respond to this develop-ment? Are there political and corporatestrategies for meeting the challengesposed by the new constellation ofeconomic powers in Asia?

“The regional development offersopportunities for integration”, ProfessorLeonard Cheng, Economist at the HongKong University of Science andTechnology, is convinced. And the eco-nomy is decisive for integration, Dr. IlhamAkbar Habibie, Chairman, Institute forDemocratization and Socialization ofTechnology in Indonesia, added. Thatmeans economic relations, export andimport, linking up China and Asia withthe USA and Europe.

And yet, the understanding of inte-gration as a concept differs greatly inEurope, Asia, and the USA. "China andAsia seem to form a trade bloc, which isworking against the US and Europe",

Jack C.K. So, Chairman of Hong KongTrade Development Council, said. Chinain particular appears to be pursuingregional partnerships in order to avoidexternal "paternalisms”. "But its positionis threatened by internal economicaland political imbalances", Dr. MichaelSchaefer, German Ambassador to China,explained.

From an American perspective, theEuropeans have established a very closerelationship to China while the countrycontinues to represent a strategicaggressor for the USA, explainedProfessor David Shambaugh, GeorgeWashington University. Michael König,President of Bayer Greater China Group,is concerned about the concepts ofdemocratic states. “If the United States,Europe and India line up with othersagainst China and Russia, that would bedisastrous and represents a veryperilous course”, he explained.

"There is no alternative to the inte-gration of China," König said, "becausethere is no solution to the energy ques-tions or fighting poverty without the big

players of tomorrow. China, Russia,Brazil, India, and others have to be inte-grated, otherwise we will be drawn back.Dr. Michael Schaefer sees the role of the emerging Asian superpower verydistinctly: “China’s interest is to be in thedriver’s seat or at least, to share insteering this development". AndProfessor Cheng added: “As Chinabecomes the largest economy in theworld, it has to take responsibility for all.”

The requirements and conditions forthis are just as distinct. The more theunderstanding of integration differs, themore important it is to have the rulesand institutions for all. On the one hand,there is the UN, which must receive anentirely new foundation in a multi-polarworld and on the other, there is the WTO,which is defining collective rules. Only ifeveryone keeps with these rules, will theyalso be able to take advantage of theopportunities of collective trade, whichwill positively influence the differingpolitical definitions of "integration". Dr.Habibie: "Win-win partnerships willmake the integration sustainable.” <<

Michael König, Bayer (China) Ltd., Leonard Cheng, The Hong Kong University of Science and Technology, Michael Schaefer, German Ambassador to China (f.l.t.r.) David Shambaugh, The George Washington University, Jack C.K. So, Ilham Akbar Habibie, The Habibie Center Foundation (f.l.t.r.)

No Alternative to Integration

2322

S imon Brooks, Vice President of theEuropean Investment Bank, has a

very simple answer to the question ofhow to best protect the environmentand prevent climate change: “We cannothang around and wait.” Christine Loh,CEO of Civic Exchange in Hong Kong,explained and added “climate change isa wake-up call.” She is however certainthat “it is a game-changer for everyonein the world.” Even in 2020 there will stillbe areas in Europe with high pollution,she forecasts, and adds “when we askthe Asians how quickly they can cleanup, don’t forget to bear this in mind.”

But what needs to be changed in thegame? “We have to create a new collab-

oration”, Loh said. Up until now, theopposite has often been the case.Developing and developed countries areblaming each other for pollution, witheveryone instead asking what they cando for themselves. “We need a globalapproach to solve the pollution problem”,Dr. Martin Brudermüller, Member of theBoard of the chemical company BASF inHong Kong, believes. “We have to bringthe right people together, because thereis a lot of knowledge, technology andmoney which has to be coordinated”,Loh said. And Dr. Brudermüller agreed bysaying that “the problem is not researchand development, but applying thesolutions.”

One such example is renewable energy.Global attitudes have shifted, even in theUSA. “In Europe, 44 per cent of people willpay more for products which are pro-duced ecologically”, Andreas Streubig,Division Manager for Environmental andSocial Policy at Germany’s mail ordergroup Otto, explained. But Klaus Bernhart,Global Head of Energy at HSH NordbankAG in New York, stressed the problem:“Entry costs are enormous and thereforewe need government subsidies for acouple of years.” Many of these forms oftechnology require high investment levelsover a long period of time, Simon Brookspointed out, “and therefore we also needregulation”. David Marsh, Chairman ofLondon and Oxford Capital Markets plc, isconvinced that “it should be seen as aMarshall Plan for the economies.”

Wu Xiangming, Chairman of theShanghai Maglev Transportation Devel-opment, demonstrated just how difficultit is to realise environmentally-friendlyinvestment if politicians do not play ball.He built the first maglev train that runs30 kilometres from Shanghai to the air-port and never tires of pointing out the ecological benefits. Wu said, “thistechnology is very good and saves a lot ofenergy, it only requires half the energyconsumption of a car.” The maglev train isa German invention, but it hasn’t beenbuilt there yet. “We were looking into anextension in 2006, but when the Germansstopped working on their projects, itheavily influenced us”, Wu explained.

The demand for a model is alsoposed regarding energy. “I don’t thinkwe have a future with our coal”,Christine Loh says, “but are you ready tosay no to more new coal plants inEurope and Germany?” <<

Andreas Streubig (left), Otto Group, and Wu Xiangming, Shanghai MaglevTransportation Development Co. Ltd.

Christine Loh, Civic Exchange, introduces possible strategies against climate change

Martin Brudermüller, BASF SE (left) Klaus Bernhart, HSH Nordbank AG

Climate Change is a Wake-up Call

Simon Brooks, European Investment Bank

2524

The human resource issue continuesto be one of the bottlenecks prevent-

ing further development in China. Lessthan ten per cent of local job candidateshave the skills required by companieswith global operations. But the countryis currently trying to overcome theimage of being the world’s workbenchand aiming to develop an innovativesociety. “Chinese companies are veryaware of the fact that they are behindcompanies from other countries”, XieQihua, former Chairwoman of BaosteelGroup and Executive Chairman of theChina Federation of Industrial Economics,admitted, “but the government wantsus to become the driving force of inno-vation.”

“What technical abilities do compa-nies in China have?”, Dr. MargotSchüller, Senior Research Fellow ofGIGA Institute of Asian Studies inGermany, asked. Baosteel is a goodexample of demonstrating the progress.“Firstly we focussed on the distribution

of our products”, Xie explained, “andsecondly we focussed on branding ourproducts.” The focus here was onenergy-saving production. Baosteelworked with domestic, as well asGerman and American universities, tobuild up competitive know-how.

Chinese companies such as Baosteelaim to benefit from the transfer ofknowledge, attain global market levels,and develop new products. The highlyambitious goal set by the governmentof no longer being dependent on non-Chinese companies by 2020 can only be achieved through internationalcooperation. But Dr. Arding Hsu, SeniorVice President of Siemens in China,believes that this can happen. “I lived inthe United States for 30 years and cameback in 1994”, he told the auditorium.“China is going to become an innova-ting powerhouse, the only question iswhen.”

Multinational companies have noalternative but to go to China, because

with globalisation, not only Chinadepends on the world but vice versa.There are nonetheless various motives,which is why foreign companies arepromoting research and development inChina. While some want to tap theChinese market, others are interested inbuilding up a corporate network withthe same level in China as elsewhere inthe world.

This is the case for Lufthansa TechnikAG, for example, which has been coop-erating with Air China since 1984.Lufthansa Technik AG started one of thefirst joint ventures at Beijing Airport.“Maintaining aircraft requires responsiblestaff, therefore we educate our emplo-yees”, August Wilhelm Henningsen,Chairman of Lufthansa Technik AG,explained. Henningsen continued “Nowwe have 5,000 employees in China, weprovide students with technical trainingand we have cooperations with the uni-versities in Beijing.”

The other side is BP, the British oilcompany: “We strongly believe that the Chinese market needs Chinesesolutions, therefore we have severaljoint ventures with Chinese partners”,Dr. Günter Strempel, Director EnergyInnovation Laboratory of BP China, toldthe auditorium. He is impressed by thehigh commitment levels to developmentdemonstrated by the government. BP hasthree major projects in China working onclean energy that address long-term andfundamental research. Dr. Strempel addedthat “in China, human resources andrecruitment are very important in order tobe an attractive company. The Chinesehave the opportunity to choose and theyare doing so; they are more flexible thanpeople in other countries.” <<

Xie Qihua, CFIE Arding Hsu, Siemens Ltd. (China), Günter Strempel, BP (China) Holdings Limited, August Wilhelm Henningsen, Lufthansa Technik AG (f.l.t.r.)

The Driving Force of Innovation

2726

There’s no doubt about it – all four ofthe so-called BRIC countries, i.e.

Brazil, Russia, India and China, are bigand their economies have grown rapidlyover the last ten years. They are home to40 per cent of the global population andthey contribute ten per cent of theworld’s GDP. “In the West we say thesecountries are important because ofgrowth”, Professor Dennis Snower,President of the Kiel Institute for theWorld Economy, declared. But thecountries are very different in terms ofpolitical backgrounds and economicframeworks. “In Russia future growthdepends for example on the investmentclimate, whereas the Chinese economybecoming increasingly effective with itsimproved financial system”, said Jean-Luc Schneider, Deputy Director of theOECD in Paris. And this results in twoquestions: What are the growth driversin the four countries and is the growthsustainable?

If we start with Brazil - it is a fact thatthe country once experienced growthrates of its domestic products like Chinais doing today. But it lost momentum inthe 1990s because of high tax burdensand political instability. The outlook hasimproved once again, Dr. Lirio Parisotto,Chairman of Videolar S.A., an entertain-ment and chemical company, believes.

“We have a big market, the largest inSouth America and we have a lot ofinfrastructure opportunities”, he stressed.This picture is surrounded by a solid mid-dle class of about five million people, alot of land with efficient agriculture and,last but not least, a big oil field, found in2007. And when he was asked about thereasons for Brazil’s further growth in thefuture, Parisoto added that “a stablefinancial policy, a policy to prevent socialdisaster and – democracy” are required

This is not the case in Russia. There isa simple answer when looking for drivingforces: luck with oil and gas. But that istoo easy, Yury Y. Demidov, Chairman ofSOVAG AG, an insurance company,believes. “Russia passed through two dif-ferent phases in the last 20 years”, heexplained. “In the 1990s the country waspoor, but it started to develop freedom anddemocracy”, Demidov remembered. But itwas not stable “so they didn’t follow thisand the economy crashed in 1998”. After-wards they were lucky with the prices ofoil and gas but also reformed the eco-nomic framework. It is now easier to get alicence for a company and they only have16 different taxes instead of 200 in 1999.“Russia found the right framework for themarket society”, Demidov resumed. Butno one knows what the effects of shrin-king oil and gas prices will be.

That is in no way the problem withIndia, a democratic country with a hugepopulation. It has a good work force,specialised in IT and software, a dynamicprivate sector, and political stability.These are the main drivers of economicgrowth which should also guaranteesustainable rates of eight per cent overthe next few years. “But we have a lot todo in terms of utilities and infrastruc-ture”, said Dr. N. Janardhan, a politicalanalyst.

Last but not least - China. “We are nota democracy”, Cai Shiyin admitted,founder of Global Fashion Project, “but itprevents instability”. And the drivers forfuture growth? “For me the biggest driverfor change and growth comes from consumer demand”, the young lady isconvinced. For example, China will be thebiggest market for luxury goods in 2014.And she believes that infrastructuregrowth will follow on from growingdomestic production. Of course there arealso big problems with the environment,she admitted, but she is convinced Chinais on the right path. “I was very critical,but now after living in six countries I amvery optimistic”, she said.

Finally Dr. Janardhan resumed, sayingthat “the international community has tolook at BRIC in a different manner, coop-eration is on the agenda!” <<

Representatives of the BRIC-countries discuss strategies for economic growth N. Janardhan, Gulf-Asia Affairs

Yury Y. Demidov, SOVAG AG Cai Shiyin, Global Fashion Project, and Lirio Parisotto, Videolar S.A.

Cooperation is on the Agenda

2928

The fast-growing demand for energyand natural resources is leading to

increasing dependence on imports and,at the same time, causing the need toopen up new sourcing opportunities. Arerenewable energies the solution? “Wehave to use more clean energy in thefuture”, Professor Eckhard Rohkamm, atthat time Chairman of German Asia-Pacific Business Association, said inconfirmation of this point, “but there arefinancial necessities - we cannot ruin oureconomies.”

Despite such restraints, wind energyfor instance “has huge potential inChina”, Lu Weiding, President of theWanxiang Group, explained. The reason is“electricity will not reach everyone in thebig country”, Lu added. ThomasRichterich, CEO of the German windturbine producer Nordex AG, assisted:“Two years ago no one mentioned windenergy in China, but now it is one of thefastest-growing markets and the mostimportant one over the next 15 years.”

Therefore Nordex AG, active on theChinese market for 15 years now, has twoproduction facilities in China. But compe-tition is increasing rapidly, Richterichreported. “40 new companies started upin the last 15 months and Chinese com-petitors are continually increasing theircompetence in the international markets.”But there are several requirements thatapply not just to wind energy but torenewable energies in general. A numberof incentives are required to start reason-able production because a lot of moneyhas to be invested before the business canbenefit from the advantage of low costs.That is the reason why there are no freemarkets for renewable and, especially,wind energy anywhere in the world. Andthere is a second requirement: the econ-omy needs electricity around the clockand not only when wind is present. Butthese problems can be solved, Richterichpromised, with a better infrastructurethan is currently in place, combined withlarge-scale off-shore wind parks.

Professor Rohkamm, however, men-tioned that all new technologies need atleast one generation to show noticeableeffect. So, he continued, “neither wind,nuclear power nor coal can solve theproblems of energy supply alone. Weneed a stable mix of all forms of energy– not only in China but everywhere elsein the world.” And this factor must beaccompanied by energy-saving mea-sures and sustainable use of nationalresources.

This is thus the only successful strate-gy available to satisfy China’s need forraw materials. “There is a growing need inChina for global raw materials”, Dr. BerndDrouven, CEO of the copper producerNorddeutsche Affinerie AG, explained,“but the country has also the responsibil-ity to balance this need and to avoidprotectionism.” Dr. Drouven believes thatthere is only one solution for both ofthese points: “In order to have growthyou have to have a strategy both forenergy and for raw materials.” <<

Moderator Eckhard Rohkamm (2nd right), German Asia-Pacific Business Association(OAV), among the participants

Lu Weiding (left), Wanxiang Group Corporation, Bernd Drouven, Norddeutsche Affinerie AG

Thomas Richterich, Nordex AG, discusses the possiblefuture developments of wind energy in China

A Strategy for Energy and Raw Materials

3130

L ogistics should not only be efficientbut also green”, Dai Wenkai, Chief

Economist at Shanghai Zhenhua PortMachinery Group, claimed. And nobodywill contradict him after looking at thefigures. Since 2001, China’s logisticsindustry recorded an impressive aver-age annual growth rate of 13 per centwith similar development expected inthe future thanks to the country’songoing surge in foreign and domestictrade. “Logistics is therefore their keyfactor for future success”, said PeterKleinschmidt, Member of the Board ofBeiersdorf AG, a German cosmeticscompany.

That is why Professor Jens Froese,Head of the Institute of Ship Operation,Sea Transport and Simulation (ISSUS),stressed that “logistics was an art butrecently it became a science. Why notestablish joint programmes betweenChina and Europe?”, he asked. Thesector still faces a number of major

challenges and contradictions, such aslow service levels and limited use ofmodern information technology, a lackof regulation in some areas and exces-sive regulation in others, an imbalancebetween poor hinterland transport infra-structure and state-of-the-art sea ports.

An example of state-of-the-arttransport is Dai’s company, a famousproducer of container-handling cranesin roughly 70 countries. The ShanghaiZhenhua Port Machinery Group assem-bles the cranes in China due to the localknow-how and low labour costs. With48 own vessels, they transport thecranes all over the world. “We have timefor transportation because we havethese vessels”, Dai explained. AndBertram R. C. Rickmers, Chairman of theRickmers Group, who owns also a linercarrier, added: “We ship turbines andother high-tech products to China andin future we will ship such goods fromChina to the USA or Europe.”

“But we have huge bottlenecks interms of inland transport”, AndreasWerner stated, General Manager ofRaiffeisen Zentralbank in Austria. “Thenumber of consumers is growingrapidly along with the number ofChina-based retail chains, but the dis-tances are immense”, Kleinschmidtadded. And customers are getting moreand more demanding, so the carrierneeds supporters to manage andcontrol the transport from start to fin-ish. “But the scarcity of young, motivat-ed people is a fact”, Werner said, whosecompany finances transport from A toB. As a result “we hire a lot of peoplefresh from university and train them.”

One reason for the lack of youngpeople is that logistics is not as sexy asother jobs, the Austrian businessman isconvinced. So he hopes to change themood, and added that “giving it moresex appeal in the public eye would bevery helpful!” <<

Andreas Werner, Raiffeisen Zentralbank Oesterreich AG Jens Froese, Technische Universität Hamburg-Harburg Dai Wenkai, Shanghai Zhenhua PortMachinery Group

Peter Kleinschmidt, Beiersdorf AG

Huge Bottlenecks in Domestic Transport

Bertram R.C. Rickmers, Rickmers Holding

3332

I s China an innovative society? If so,how will it develop in future? Will old

Western industrial regions, such as theEuropean Union, benefit from this orinstead suffer increased pressure fromcompetition? Singapore’s state founder,Lee Kuan Yew, and Professor Edmund S.Phelps, Nobel Prize winner forEconomics from the USA, covered theseissues during their keynote speeches atthe end of the Hamburg Summit.

Professor Phelps elucidated the sit-uation with a brief historical outline.“A very large portion of countries’ pro-ductivity is not the result of domesticendeavours, but rather those of globalendeavours”, he noted, and added that“In the 20th century, new inventionswere largely made outside thenations.” Investors then provided con-sumers with access to the inventionsin their respective countries. Driven bythe hope of social ascent througheconomic success, these “people with entrepreneurial spirit make the

sacrifices, but they do not inventanything.”

When applied to China, the professorfor economics reaches the followingconclusion: “The initial innovations inChina are still small in relation to theknowledge abroad. But its business andpoliticians are very busy transferringoutside knowledge into their country.”His summary is that “the emergence ofa new large economy can slow downinnovations but, on the other hand, themarket grows and with it the opportu-nity to pay off innovative investments”.Professor Phelps is convinced that weare looking forward to a period of moreinnovations in the world.

This is a position Lee Kuan Yewaffirmed in his speech via satellite link.“After 40 years of extreme dynamismthey are hitting growth borders” heexplains. But they cannot stay stillbecause “they not only have social andenvironmental problems”, he told theaudience, “global downturn will force

them to focus more on national con-sumption.” And there is a lot of room ifyou compare for instance the consump-tion of 70 per cent in the USA withsome 35 per cent in China. And costsare rising, “so they have to restructure,as Singapore has done, to higher pro-ducts and to upgrade people’s skills.”

Lee has no doubt, that China is get-ting it together. “At the Olympic Gamesthe world was able to see China’s capa-bilities”, Lee said. It was one of three bigevents in 2008 which changed societydeeply. The big snow disaster and espe-cially the earthquake galvanised them,because, for the first time, politicalleaders were seen hand in hand withthe people. “But the Olympic Gameswere the latest evidence that they haveto work together to be successful”, Leeis convinced. And “they know that everyyear of peace will help to develop thecountry and to close the gap to devel-oped countries, therefore they want toavoid conflict”, Lee concludes. <<

Nobel Laureate Edmund S. Phelps, Columbia University, points out the importance of political and economic frameworks for innovation

Looking Forward to a Period of Innovations

Singapore’s Minister Mentor Lee Kuan Yew (right) stresses the importance of China’s process of opening up

Edmund S. Phelps (left) and Moderator Horst Teltschik

3534

Nearly two years ago, the EuropeanCommission launched its “Global

Europe” strategy to increase Europe’scompetitiveness within the globaleconomy. “The challenge is to grasp theopportunities offered by the currentglobalisation process and to minimisethe risk from unfair trade practices andprotectionism”, Pierre Simon, Presidentof Eurochambers, explained in hiskeynote speech at the end of “TheHamburg Summit: China meets Europe”.China plays an important part in thisstrategy because trade between the EUand China increased by 17 per cent in2007. But what are the crucial pointsrequired to make the strategy a success?

First of all the failure to come to anagreement during the WTO negotiationson the Doha Agenda has been a majorsetback. “The benefits of a liberalisedworld economy with improved market

access, a stable, transparent and interna-tionally accepted system of rules andinstruments are essential”, Simonexplained. And he hopes that there is avery small window of opportunity toresume the Doha talks.

One of the main issues of trade rela-tions with China is of course the problemof protecting Intellectual PropertyRights. Simon: “China still remains themain source of counterfeit goods, withalmost 60 per cent of all articles seizedat EU borders coming from there.” Andit is not only companies that lose a lotof money from fake goods, but there isalso the social aspect regarding con-sumer health and protection. This is alsofundamental for the Chinese economyand their major brands which areequally subject to pirated goods.“Promoting global and fair trade andenhancing protection against unfairtrading practices will lead to increased,

safer and more stable trade betweenEurope and China”, Simon said.

But there is another topic he as a rep-resentative of European Chambers ofCommerce stressed - “It is important forthe EU to be visible and present in theemerging markets.” Therefore theEuropean Commission signed a contractwith India to establish an EU Business andTechnology Centre in Delhi. “This centrewill help European Companies to enterthe Indian market. And the EUCommission has ambitions to set up a sim-ilar European business centre in China.”

The reason for this is quite clear,“Europe is becoming a brand of its own”,Simon explained, “and more and morecompanies are presenting themselves asa European company, instead of French,German or Italian. This is the way to fos-ter relations which are correctlydescribed with the word ‘partnership’”,Simon believes. <<

Pierre Simon, Eurochambres The audience actively participates in the discussion

Participants attending Simon’s speech Simon's keynote on mutual business opportunities for Europeanand Chinese companies

Europeans should be Visible and Present

3736

A tradition at the “Hamburg Summit:China meets Europe” is that two

prizes are awarded to deserving Chineseand European personalities. The “China-Europe Friendship Award” honoursspecial commendation for relationsbetween the upcoming Asian economicpower and the old continent. The“China-Europe Sustainability Award”honours people who have made a special commitment to environmentalprotection. Both prizes are awarded torepresentatives of both regions on analternate basis.

This year’s “China-Europe FriendshipAward” was conferred by Jack C.K. So,Chairman of Hong Kong Trade Develop-ment Council, to the former FrenchPrime Minister Michel Rocard, who isnow a Member of the EuropeanParliament. “Rocard stressed the impor-tance of mutual understanding”, he saidin his laudation and added that “we are

continuing the process of understand-ing at this Summit because China andthe EU must work together to achievebetter results.”

Rocard answered “I accept this prizewith great emotion.” He recalled a din-ner with German chancellor HelmutSchmidt in Paris in 1982 where he askedto speak to Rocard in private – just fourpeople were involved in the discussion.Rocard recounts that “he told everyonehow stupid the Americans’ hostile atti-tude towards rising China was.”

During the dinner at the end of thefirst day of the Hamburg Summit at thefamous Hotel Atlantic, the formerChairwoman of Baosteel, Xie Qihua,received the “China-Europe SustainabilityAward”. In his laudation Berndt Röder,President of the Parliament of the Freeand Hanseatic City of Hamburg, stressedthe outstanding activities undertaken byBaosteel to protect the environment. Ms

Xie is not only responsible for Baosteel’sdevelopment towards becoming one ofthe biggest corporates in China, Rödertold the audience, “but she made also alot of effort to make steel productionmore ecological.” He urged the audienceto “go to Shanghai and visit Baosteel,you will see a tiny production site in agreen area.”

Xie was deeply impressed to be hon-oured in this way and pointed out that“producers in Germany, France andChina are committed to protecting theenvironment. All managers need to worktogether to provide for a better future.”

And Nikolaus W. Schües, ConferenceChairman and former President of theHamburg Chamber of Commerce, addedthat “sustainability is no longer anoption but a must in order to save theworld for our children. The Chinesegovernment and the business communi-ty are striving to achieve this goal.” <<

Jack C.K. So (left) hands over the “China-Europe Friendship Award” to Michel Rocard Xie Qihua receives the “China-Europe Sustainability Award” Award winner Michel Rocard Xie Qihua and Moritz Fürste, German hockey gold medallist (f.l.t.r.)

Two Awards for a Better Understanding

3938

I n times of globalisation proceeding atfull speed, a good and friendly rela-

tionship between China and Europe is ofutmost importance for both sides. Inorder to build up such a strategic part-nership, it is imperative to respect eachother’s traditions and feelings. The suc-cess of the Olympic Games is a kind of“crown” for the work that had been doneup to now – thanks to the significantimprovements made, China is now play-ing a decisive role in the world economy.

When we started to plan this confer-ence right after the end of the lastHamburg Summit in 2006, our aim wasto strengthen European and interna-tional attendance. Looking back we candefinitely say that we reached our goal.But the path to this success has notalways been an easy one. Almost exact-ly one year ago, German-Chinese rela-tions were interrupted abruptly. Thepolitical resentments turned into an iceage which lasted almost half a year. Thisperiod gave us many sleepless nights.

But even in these difficult times, weat the Hamburg Chamber of Commercealways believed in the strength of dia-

logue. After a successful conference Iam happy and proud that the third“Hamburg Summit: China meetsEurope” was the occasion for the firstvisit to Europe by a member of theChinese government after the politicalturbulences. Thus, our Hamburg Summitwas also an important milestone on theway to improving Sino–European rela-tions.

What did we learn from this year’sconference? Let me point out the majorresults:

First: China is on its way to assumingglobal responsibility, and the EuropeanUnion should welcome and support thisdevelopment. In turn we should all doour utmost to promote multilateralcooperation leading to a fair, just, andrule-based international system.

Second: The dramatic challenges ofclimate change and environmental pol-lution in China can only be dealt with inthe form of a joint Sino-European initia-tive. We have discussed China’s way ofcombating the challenges and Europeanways of supporting these approaches. Afair dialogue on an eye-to-eye level is

necessary to find solutions suitable forall of us.

Third: For the time being, there isunfortunately no purely European way ofdoing business with China and of jointlyrepresenting our interests vis-à-vis thegovernment in Beijing. National interestsare still predominant. This certainly hasto change. How can we be seen as aUnion if we do not behave as one?

Fourth: China is definitely a must formost European companies. For somefirms facing growing competition fromChina, it is a question of survival toarrange partnerships with Chinese firms.The process of opening up has newopportunities in store. They should notbe missed!

Fifth: The European Union shouldsupport the Chinese government in itsendeavours to reform the economy andestablish a stable society. All of thespeakers and panellists at the HamburgSummit unanimously pointed out thatthere is an enormous need for reforms inthe People’s Republic.

So, indeed, there are still “challengesahead”. But as long as we continue fos-tering the dialogue, I am confident thatwe will always find ways to solveupcoming problems. “This third timemarks the beginning of a tradition”,Helmut Schmidt said at the beginning ofthis Hamburg Summit. And he addedthat “I sincerely hope that the Chineseand European guests will contributetowards the future of this tradition”. Ican assure you now that we willcontinue this tradition, and the fourth“Hamburg Summit: China meets Europe”will be hosted in autumn 2010. <<

Nikolaus W. Schües, Conference Chairman, concludes the conference

International press attends the whole conference

Networking among the participants

Ways to solve Upcoming Problems

4140

It is a pleasure joining you in this prestigiousbiennial event to celebrate and strengthen Sino-European ties. H.E. Sheikha Lubna Al Qasimi, 11 September 2008

The fact that such a high-ranking politiciancomes to Hamburg is a clear gesture that youshould not underestimate. Christine Loh, 11 September 2008

It is the superlative Sino-European summit – theonly international economic conference dealingwith the gamut of common relations in Europeand attended by scores of top-flight participants.Hamburger Abendblatt, 11 September 2008

Three times marks the beginning of a tradition. I sincerely hope that the many guests here today from China and Europe will contribute to the tradition of the “Hamburg Summit”. Helmut Schmidt, 11 September 2008

In light of the global importance of China-EUrelations and speaking as a business representa-tive, I believe that such an event as the HamburgSummit is crucial to ensuring an ongoing dia-logue between all relevant stakeholders. Pierre Simon, 12 September 2008

Hamburg’s China Summit enjoys an excellentreputation in Beijing. Horst Teltschik, 12 September 2008

The summit, initiated by the Hamburg Chamberof Commerce, is a vital platform for prominentpublic and private sector personalities. Emirates News Agency, 15 September 2008

“We are confident that China’s economy will con-tinue to grow, but China cannot develop withoutthe rest of the world and vice versa.” Zhang Dejiang, Deputy Prime Minister, People's Republic of China

“The more we become integrated in the globalflow of information and trade, the less we can shy away when it comes to meeting globalchallenges together.” Frank-Walter Steinmeier, Federal Foreign Minister andDeputy Chancellor, Federal Republic of Germany

“There is an imperative need to build and sustaina constructive working relationship between theEuropean Union and China in order to guaranteethe security of our energy supply, to slow downclimate change, to settle or prevent local andregional conflicts, and to combat internationalterrorism.” László Kovács, Commissioner for Taxation and CustomsUnion, European Commission

“We need forward-looking strategic projects onkey industries like automobile, energy, publictransport. We want to attract more talents and acomprehensive atmosphere for research.” Xie Qihua, China Federation of Industrial Economics

“We see a healthy development between theEuropean Union and China and we invite allEuropean Companies very much to invest inChina.” Jiang Yiren, Shanghai Federation of Industrial Economics

“Now China has a place in the rule-setting organ-isation WTO, the country is no longer dominatedby the West. There will be a new world, in whichthe East has the same voice.” Ronnie C. Chan, Hang Lung Group

“The world economy is navigating through heavyseas at the moment. Both China and the EuropeanUnion are confronted with a number of commonchallenges as well as specific domestic concerns.”Lucas Papademos, European Central Bank

“The earthquake galvanised them together andthe Olympic Games were the last proof for theChinese people that they have to work togetherto close the gap to the developed countries.”Lee Kuan Yew, Minister Mentor, Republic of Singapore

Views on the Hamburg Summit Quotes

43

HSH Nordbank – a leading financing partner.

With our roots in Hamburg, HSH Nordbank has traditionally enjoyed

strong ties to China. Our local presence in Hong Kong and Shanghai

is a clear commitment to our clients. Our leading position in the

fields of shipping, aviation, infrastructure, logistics and commodities

is clear proof of our competence in the transportation sector.

Benefit from our strengths.

www.hsh-nordbank.com

Exclusive Sponsor of

• H.E. Sheikha Lubna Al Qasimi, Minister of Foreign Trade, UAE• Klaus Bernhart, General Manager, New York Branch, Global Head of

Energy, HSH Nordbank AG, USA / Germany• Ole von Beust, First Mayor and President of the Senate, Free and

Hanseatic City of Hamburg, Germany• Simon Brooks, Vice President, European Investment Bank, Luxembourg• Dr. Martin Brudermüller, Member of the Board, BASF SE, Hong Kong• Ronnie C. Chan, Chairman, Hang Lung Group, Hong Kong• Prof. Leonard Cheng, Acting Dean, School of Business and Management,

Chair Professor, Department of Economics, The Hong Kong University ofScience and Technology, Hong Kong

• Lt. General (Ret.) Daniel Christman, Senior Vice President, US Chamber ofCommerce, USA

• Dai Wenkai, Deputy President, Chief Economist, Shanghai Zhenhua PortMachinery (Group) Co. Ltd., P.R. China

• Prof. Xie Danyang, Head of Economic Department, The Hong KongUniversity of Science and Technology, Hong Kong

• Dr. Bernd Drouven, Chief Executive Officer, Norddeutsche Affinerie AG,Germany

• Prof. Jens Froese, Professor and Head of Institute of Ship Operation, SeaTransport and Simulation (ISSUS), Technische Universität Hamburg-Harburg, Professor of International Logistics Management andEngineering, Jacobs University Bremen, Germany

• Dr. Ilham Akbar Habibie, Chairman, Institute for Democratization andSocialization of Technology, Vice Chairman, Board of Directors, The HabibieCenter Foundation, Indonesia

• Dr. Richard Hausmann, Chairman, German Chamber of Commerce inChina, President and Chief Executive Officer, North East Asia Region,Siemens AG, President and Chief Executive Officer, Siemens Ltd., P.R. China

• August Wilhelm Henningsen, Chairman of the Executive Board, LufthansaTechnik AG, Germany

• Frank Horch, President, Hamburg Chamber of Commerce, Germany• Dr. Arding Hsu, Senior Vice President, Head of Corporate Technology,

Siemens Ltd. China, P.R. China• Anne Marie Idrac, Minister of State to the Minister for the Economy,

Industry and Employment, with responsibility for Foreign Trade, France• Dr. N. Janardhan, Political Analyst, Gulf-Asia Affairs, UAE• Jiang Yiren, Member of the Standing Committee, CPPCC National

Committee, Chairman, CFIE Presidium, Chairman, Shanghai Federation ofIndustrial Economics

• Peter Kleinschmidt, Member of the Executive Board, Beiersdorf AG, Germany• Steffen Klusmann, Editor-in-Chief, Financial Times Deutschland, Germany• Michael König, Chairman of Bayer (China) Ltd., President of the Bayer

Greater China Group, President of Bayer MaterialScience China, P.R. China• László Kovács, Commissioner for Taxation and Customs Union, European

Commission, Belgium• Lee Kuan Yew, Minister Mentor, Republic of Singapur (via satellite)• Christine Loh, Chief Executive Officer, Civic Exchange, Hong Kong• Lu Weiding, President, China Wanxiang Group Corporation, Chairman,

CFIE Presidium, P.R. China• David Marsh, Chairman, London and Oxford Capital Markets plc, U.K.• Matthias Nass, Deputy Editor-in-Chief, DIE ZEIT, Germany• David O’Sullivan, Director General, Directorate General Trade, European

Commission, Belgium

• Prof. Lucas D. Papademos, Vice-President, European Central Bank, Germany• Dr. Lirio Parisotto, Founder and Chairman, Videolar S.A., Brasil• Prof. Edmund S. Phelps, Nobel Laureate, McVickar Professor of Political

Economy, Director, Center on Capitalism and Society, Columbia University,USA

• Thomas Richterich, Chief Executive Officer, Nordex AG, Germany• Bertram R.C. Rickmers, Chairman, Rickmers Holding GmbH & Cie. KG,

Germany• Peter Rieck, Deputy Chief Executive Officer, HSH Nordbank AG, Germany• Michel Rocard, former Prime Minister of the Republic of France, Member

of the European Parliament, France• Prof. Dr.-Ing. Eckhard Rohkamm, Chairman, German Asia-Pacific

Business Association (OAV), Germany• Prof. Dr. Eberhard Sandschneider, Otto Wolff-Director, Research Institute,

German Council on Foreign Relations, Germany• Dr. Michael Schaefer, Ambassador of the Federal Republic of Germany to

the People’s Republic of China• Helmut Schmidt, former Chancellor of the Federal Republic of Germany• Jean-Luc Schneider, Deputy Director, Policy Branch, Economics

Department, OECD, France• Nikolaus W. Schües, Conference Chairman, former President, Hamburg

Chamber of Commerce, Shipowner, F. Laeisz GmbH, Germany• Dr. Margot Schüller, Senior Research Fellow, GIGA – Institute of Asian

Studies, Germany• Prof. David Shambaugh, Director, China Policy Program, The Elliott School

of International Affairs, The George Washington University, USA• Pierre Simon, President, Eurochambres, Belgium• Prof. Dr. Dennis Snower, President, Kiel Institute for the World Economy,

Germany• Jack C.K. So, Chairman, Hong Kong Trade Development Council,

Hong Kong• Dr. Theo Sommer, Editor-at-large, DIE ZEIT, Germany• Dr. Frank-Walter Steinmeier, Federal Foreign Minister and Deputy

Chancellor, Federal Republic of Germany• Dr. Günter Strempel, Director, EIL, BP (China) Holdings Limited, P.R. China• Andreas Streubig, Division Manager Environmental and Social Policy,

Otto Group, Germany, • David Tak-kei Sun, BBS, JP, Chairman and Managing Partner, Ernst &

Young Far East Area, Hong Kong• Prof. Dr. h.c. Horst M. Teltschik, Chairman, Teltschik l Hauer Associates,

Germany• John Thornhill, European Editor, Financial Times, U.K.• Prof. Dr. Norbert Walter, Chief Economist, Head of Deutsche Bank

Research, Deutsche Bank AG, Germany• Dr. Ulrich Weber, Vice-President Final Assembly Line China, Airbus,

Germany• Mag. Andreas Werner, General Manager, Raiffeisen Zentralbank

Oesterreich AG, P.R. China• Wu Xiangming, Chairman, Shanghai Maglev Transportation Development

Co., P.R. China• Jörg Wuttke, President, European Union Chamber of Commerce in China,

Chief Representative China, BASF China, P.R. China• Xie Qihua, former Chairwoman, Baosteel Group Corporation, Executive

Chairwoman, CFIE Presidium, P.R. China

Hamburg Summit Speakers

@ Selected speeches are available at www.hamburg-summit.com

THE HAMBURG SUMMITChina meets Europe 10 to 12 September 2008

Hamburg Chamber of Commerce

Exclusive Sponsor