The first rejection of state Hermes investment guarantees for projects in the People’s Republic has met with resentment among German companies. The chemical company BASF responded to WELT AM SONNTAG’s request with clear words.

“Both existing and new investment guarantees for China have always been granted to us and we expect that this will continue to be the case,” the company said in a statement.

At the moment, no Hermes application from the company for China business is open to the federal government. According to Economics Minister Robert Habeck (Greens), the federal government has refused state guarantees for four projects in China in recent weeks, and the carmaker Volkswagen is apparently affected. Habeck justified the rejection in a WELT AM SONNTAG interview with the human rights situation.

From the point of view of the industry, a withdrawal from China is out of the question. “The market is far too big and too important for that,” said Thilo Brodtmann, General Manager of the Association of German Mechanical and Plant Engineering (VDMA), WELT AM SONNTAG.

However, companies would be more cautious, also because of China’s attitude. “The position towards Russia and the European Union does not exactly show that the Chinese are interested in fruitful cooperation,” said Brodtmann.

“They prefer to export their products all over the world, but they seal off their own country.” The VDMA advises companies to review investments and consider new or additional locations in other Asian countries.