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Passing the Baton
State Secretary of Hamburg talks about the G20 Hangzhou Summit, and preparation for the upcoming G20 Hamburg Summit
By Xu Bei | NO. 37 SEPTEMBER 15, 2016

Wolfgang Schmidt (CHEN RAN)

As the G20 Hangzhou Summit came to a close, world leaders began drawing their attention to Hamburg, Germany, which will be the host of the 2017 event. Beijing Review reporter Xu Bei spoke with Wolfgang Schmidt, State Secretary of Hamburg, a senior official in charge of the city's international affairs, in Hangzhou. An edited excerpt of the interview follows:

Beijing Review: The world hopes that China will be able to maintain its growth and its role as a driver of the world economy. For China, finding a new, more sustainable, inclusive and interconnected, path of growth and development seems to be paramount. Are these goals that Hamburg and the German Government can relate to? 

Wolfgang Schmidt: All governments try to find the most sustainable path to growth and development. When we look at the recent history of China, it is plain to see that the last three or so decades were characterized by a tremendous rate of growth. I think that this is quite normal, given the point at which China started, and the incredible speed at which it caught up. In Western industrialized countries like Germany, the story is quite different--when China started catching up, our economy had already been growing for two or three decades. So, naturally, the rate at which it now grows isn't that impressive anymore.

Nowadays, we concentrate on sustainable growth. During the last two decades, the topic of ecology has become ever more important all over Europe. We've seen the phase-out of nuclear energy in Germany, which now relies on renewable energies--safer and cleaner. These are topics that the whole world should discuss. If our economies continue growing at this rate, whilst being so inefficient and unsustainable, our resources will be gone sooner rather than later. Thus, it is of utter importance that the heads of state of the 20 biggest economies and trading nations meet once a year to discuss these problems. After all, we are all together in this, and there isn't one country--or even one whole continent--which could solve these problems all by themselves.

Hamburg has had its official office in Shanghai for the last 30 years. Are the cooperative relations between Shanghai and Hamburg demonstrative of the interconnectedness that China addresses in the motto of the Hangzhou G20 Summit? 

VIDEO: Wolfgang Schmidt on Being Interconnected

I believe that the relations between Hamburg and Shanghai--or the relations between China and Germany, for that matter--already show signs of those values the Hangzhou summit and its motto attempt to embody. The city of Hamburg has had worldwide trade relations for centuries. Nowadays, China's Belt and Road Initiative is of great interest to us, since Hamburg is one of the terminals of the Silk Road Economic Belt. That's why I'm absolutely certain that the motto of the G20 Hangzhou Summit--especially the part about more interconnectedness through world trade--is something my city and country can relate to.

Will China be able to help steer the world economy in a more hopeful direction?  

We all know that China has become the second biggest economy in the world. It is even the world champion in terms of exports and foreign trade. The influence China has on the world economy is staggering. This is why we all want to know about China's most recent growth numbers and it's why we want to know its domestic demand is developing. At the same time, and especially during the last 10 years, we have seen a lot of investments by Chinese companies. In Germany, a lot of medium-sized companies have been sold to Chinese investors, while many other German companies in China are part of joint ventures. So we can see from this that the ties between Germany and China are indeed very close, and since China plays such a big role as locomotive of the world economy, I believe it's only natural that the rest of the world is very interested in the development of this country.

In my opinion it's only natural that the Chinese economy isn't growing as fast as it used to. But that should be of no concern, if China manages to invigorate its domestic demand. As a person coming from a developed social state, in which the state offers a load of benefits to its citizens--high retirement pensions, comprehensive health insurance, as well as unemployment and accident insurance, and more--it interests me to see how China is dealing with all of this. The problem of creating a growing, inclusive economy, where every individual can partake and reap the benefits of a more prosperous society, is difficult to achieve.

China and Germany both have very strong industries. And both countries want to connect their respective "Industry 4.0" and "Made in China 2025" strategies. Do you see China as a competitor or as a partner? 

VIDEO: Wolfgang Schmidt on Competition and Cooperation

From my point of view, the world and the world economy are certainly big enough for China and Germany. So I don't think we have to be afraid of becoming die-hard adversaries. It's only natural that we are partners and competitors at the same time. But when we look at the ever-growing interconnectedness of the world economy, it would be wrong to say that we are only competitors. We are partners as well. Of course, there are markets in which Chinese and German companies act as fierce competitors. But that is not a bad thing, since it challenges them to become better.

Digitalization, for example, is a challenge all companies must face. A good example for doing this successfully is Alibaba, the jewel in the crown of e-commerce here in China. And as we have seen, there have been many heads of state and business leaders who were interested in taking a tour of the Alibaba campus here in Hangzhou. So clearly, everybody and their grandma have understood the challenge we are facing. The German industry is changing very quickly, too.

Digitalization has influenced all areas of business and production. We've already heard about the similarities between the German "Industry 4.0" and the Chinese "Made in China 2025" plans. I'm sure that we can learn a lot from each other in that area. Chinese companies are heavily invested in German technological leaders. But at the same time, they need German technologies. I feel very strongly that the German presidency of the G20 will make digitalization one of the main topics of the G20 summit in Hamburg.

Wolfgang Schmidt (right), State Secretary of Hamburg, chats with German journalists covering the G20 Summit in Hangzhou on September 4 (CHEN RAN)

As the authorized representative for all foreign affairs of the city of Hamburg, you are directly responsible for major international events like the upcoming Hamburg G20 Summit in 2017. What does the G20 Summit in Hamburg mean for you?

VIDEO: Wolfgang Schmidt on 2017 G20 Hamburg Summit 

A lot of work! Of course we do have a lot of staff now concerned with security, accommodation and logistics. And naturally we have to inform the citizens of Hamburg about all of this. That's why the G20 Summit means a lot of work for me. But it will also be a joy to welcome delegations from all over the world, and to show them and the rest of the world our beautiful city. I'm really looking forward to it.

What will this event mean for the city of Hamburg? 

It means that we will receive a lot of guests in a very short time frame, and a lot of attention from all around the globe. I'm certain that a G20 Summit--as we can see in Hangzhou, actually--is a good opportunity for a city to present itself to the world. But there are also a lot of security precautions to be taken, which will limit the ability of our citizens to move freely.

Copyedited by Bryan Michael Galvan

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