Merkel Dishes More Than Diplomacy in China

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July 4 (Bloomberg) -- Michal Meidan, associate fellow at Chatham House, discusses the focus of Merkel’s 7th visit to China. She speaks with Anna Edwards on Bloomberg Television’s “On The Move.” (Source: Bloomberg)

From chatham house.

Let's talk about this visit.

It is the seventh visit.

Interesting that david was pointing out how she will be focusing on the west of the country, the less developed part of china or the chinese government wants to push development.

It is about trade and technology.

Chengdu is an aspiring hub for technological development.

It is the base for a joint venture.

So the government is trying to push more and more investments into central and western china.

And to make it a technological hub.

There are a number of challenges associated with infrastructure development and the spicy cuisine.

But beyond that, it is very much about increasing germany's very strong foothold in the chinese economy and helping the chinese industry move up in terms of r&d. in beijing, she will likely give a speech at a university, the chinese mit.

The focus on technology.

And the focus on technology could take them into environmental policy.

The leadership there has stated recently that they will not -- no longer pursue growth at any cost.

How is germany's prominence in that sort of type of engineering, how is that going to feature?

That will be one of the main deliverables we will see in the talks.

It is about cooperation in r&d and manufacturing.

It is not just about renewable energy.

It is about more efficient manufacturing where germany has a clear edge.

German manufacturers will try to press upon the chinese that intellectual property has to improve so that european and western firms feel comfortable investing in china.

I think german companies should start focusing more on just as much of the software and the hardware management, compliance and helping the chinese government implement their energy-efficient technologies, not just selling them know how.

Trade deals seem to be very much en vogue.

We have got the transpacific partnership.

The transatlantic trade and investment.

Are army going to add a chinese version?

-- are we going to add the chinese version?

They are looking at this trend of trade deals and they do not want to be left out.

They could find themselves out of a huge market share that will impact their economic growth and their viability.

So they certainly want to push forward and get angela merkel's support for the bilateral investment treaty.

But for europe, that comes at a second priority after ttip, after the deal with the u.s. what about the growth picture for china?

7.5% is the target this year.

Do you think that will be achievable when the premier was in london recently, he was pledging that there was not going to be a hard landing for the chinese economy.

Has that message got out there?

No hard landing?

There are still concerns in the marketplace about debts and shadow banking that the government is committed to supporting the kind of growth.

It has the tools to reach it.

There are possible default.

But overall, the economy should be.

Supported by this infrastructure growth what is hampering it now is the government's own anticorruption campaign that is making officials worried about all the scrutiny they are going to get from investment deals.

It is about the government signaling it is ok to invest and ok to grow to its own constituents.

Having angela merkel go to cheng du will support that.

Is urbanization one of the more long-term drivers of the growth trend in china?

Has that got a long way to go?

It is only half the population of china live in cities.

Which if it were to follow a western example would suggest that that urbanization process has further to run.

It has a long way to run with the amount of people that need to be urbanized and just the potential for infrastructure buildout, houses, the whole gamut.

There is scope for european know-how, not just on the hardware but on the software of managing urban development where china would edit it from european-style, more efficient cities -- china would benefit from the european-style more efficient cities.

Great to get your thoughts.

Coming up on the program, finding the perfect cup of coffee.

It is no easy feat.

Why this luxury coffee maker is using cats to process the been.

?

This text has been automatically generated. It may not be 100% accurate.

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