Chinese President tells Germany's Scholz cooperation not a 'risk' amid EU trade tensions

Chinese President Xi Jinping said on Tuesday cooperation between China and Germany was not a "risk" but a guarantee for stable ties and an opportunity for the future, amid complaints by the EU about Chinese goods flooding the bloc's markets.

The industrial and supply chains of China and Germany are deeply intertwined and their markets highly interdependent, Xi told German Chancellor Olaf Scholz in Beijing.

"We must view and develop bilateral relations in an all-round way from a long-term and strategic perspective," Xi said.

Scholz's three-day visit to China was his first since his government launched a "de-risking" strategy last year to avoid relying excessively on Chinese suppliers.

His visit also coincided with EU concerns about the threat to European businesses from Chinese goods, including electric vehicles and other green technologies, flooding its markets.

EU Commission president Ursula von der Leyen has complained about China's overproduction being unfairly supported by "massive" state subsidies.

"(Germany and China) should be vigilant against rising protectionism, look at the issue of production capacity objectively and dialectically from a market-oriented and global perspective," Xi told Scholz.

Scholz has been cautious about pushing away China, an important market for Germany, saying the EU should not act out of protectionist self-interest.

Competition between China and Germany ought to be fair, however, Scholz said in Shanghai on Monday.

"At some point, there will also be Chinese cars in Germany and Europe. The only thing that must always be clear is that competition must be fair," Scholz told students at Tongji University in Shanghai.

"In other words, that there is no dumping, that there is no overproduction, that copyrights are not infringed," Scholz said.

The trip to China by Scholz has taken him to big Chinese cities including Chongqing, where he visited German auto supplier Bosch's hydrogen fuel cell plant.

Scholz was joined by senior German executives including Ola Kallenius, chairman of Mercedes-Benz, and Oliver Zipse, chief executive of BMW underlining the importance of the Chinese market to Europe's largest economy.

The Sino-German economic relationship should not only be cultivated but expanded, Mercedes-Benz Chairman Kallenius told German broadcaster ARD in Beijing on Tuesday.

"Withdrawing from such a large market is not an alternative, but rather strengthening our position," he said about the company's strategy in China.

BMW's Zipse expressed a similar view on China, Germany's biggest trading partner.

"We actually see more opportunities than risks," he told the ARD news program Tagesschau.

China and Germany have "huge potential" for cooperation in both traditional fields such as machinery manufacturing and automobiles and emerging fields including green transformation and digital artificial intelligence, Xi told Scholz.

Reuters