GERMANY AND CHINA: PARTNERS, COMPETITORS OR SYSTEMIC RIVALS?

China is currently Germany's main trade partner. For many German companies, it is an attractive production site and an important link in global value chains. Despite existing disagreements, both sides in their official documents have continued to view their relationship as "comprehensive strategic partnership". Yet experts and German mass media have increasingly tended to call China a "systemic rival". Berlin is aware of the fact that it is having to deal not with a competitor but with a real contender for the world's economic and technological leadership. Moreover, it is feared that the Chinese model based on the combination of state economic dirigism and political authoritarian methods of government may find a sympathetic ear in some countries. The question is how to build relationship with China in this new situation. The quest for a reasonable balance between calls to give a "tough" answer to the Chinese capital expansion, the drain of technologies and restrictions that German companies are facing in China's market on the one hand and the necessity to continue a constructive dialogue with the new superpower on the other - that is the main task of German politics with respect to China. In view of the absence of a common political stance to be followed by the European Union countries in their dealings with China and the growing U.S. pressure aimed at securing, from its allies, support of the policy of confrontation towards China, the formulation of the German Chinese policy will most likely have to be situational resembling an attempt to solve an equation with many unknowns. The article explores trade and investment aspects of German-Sino relations and existing contradictions in the domain of scientific and technical cooperation and technology transfer. Analysis is made of German business complaints regarding conditions of doing business in China, as well as of steps taken by the German authorities to limit Chinese investors' activity in Germany.