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International Relations

China reaches out to Germany under 'free trade' banner

Leaders vow cooperation on self-driving cars as Trump's auto tariffs loom

Angela Merkel met with Chinese Premier Li Keqiang on her 11th trip to China as German chancellor.   © AP

BEIJING/BERLIN -- China and Germany will increase cooperation on autonomous driving, Premier Li Keqiang and Chancellor Angela Merkel agreed at a Thursday meeting in Beijing that took place against a backdrop of trade tensions with the U.S.

China "welcomes investment by German automakers working to produce autonomous vehicles," Li said at a joint news conference.

Merkel, visiting the country for the 11th time since taking office in 2005, expressed a desire to "deepen cooperation with China in the field of autonomous driving" as long as "German businesses would be treated as equals" to Chinese counterparts. The chancellor spoke later with Chinese President Xi Jinping.

China has made developing autonomous vehicles driven by artificial intelligence a national effort. Building a futuristic city based around self-driving cars near Beijing by 2035 is a pet project of Xi's.

As Germany strives to develop self-driving tech and the AI that it requires, China makes an appealing partner for automakers such as Volksawagen thanks to its vast market and troves of data. Merkel plans on Friday to tour the city of Shenzhen, a tech hotbed that is home to internet group Tencent Holdings and DJI, the world's largest drone manufacturer.

China, meanwhile, is trying to align itself with Europe as U.S. President Donald Trump's administration ratchets up pressure on trade and technology -- moves that have upset America's European partners.

Li told reporters that Germany and China "must defend the principles of free trade and advance trade liberalization" -- a clear reference to Wednesday's reports that the Trump administration was considering steep tariffs on imported cars and autoparts. 

But many in Europe's biggest economy remain troubled by Beijing pressuring the German businesses that operate in China to hand over technology, as well as frequent spying by Chinese authorities. Though Berlin opposes Trump on matters such as trade and exiting the Iran nuclear deal, many Germans are wary of edging away from Washington toward Beijing.

Human rights issues in China present another barrier to bilateral relations. During their conversation, Merkel is believed to have urged Li to let Liu Xia, widow of Nobel Peace Prize winner Liu Xiaobo, leave the country. The democracy activist died in July after years in Chinese prison. Liu Xia has been confined to her home in Beijing in a state of virtual house arrest.

A live Chinese television broadcast of the news conference was quickly halted when a German reporter raised the topic. Li responded that "China will respect the actions taken in accordance with the law by judicial and law enforcement bodies, but at the same time we must respect humanitarianism," according to Reuters.

Merkel said only that the countries would discuss the issue by the end of the year.

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