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German Investment in China Soars Despite Berlin's Diversification Drive

By QNA

August 14, 2023

Figures provided to the Financial Times by the Bundesbank, Germany's central bank, show that German direct investments in China are on the rise. German companies are increasing their direct investments in China this year despite their government urging them to diversify.

According to the Bundesbank, German direct investment in China rose by 43% to a record high of 119 billion euros ($127 billion) last year. This increase comes despite the German government's efforts to encourage companies to diversify their investments away from China.

There are a number of reasons why German companies are continuing to invest in China. China is a large and growing market, with a population of over 1.4 billion people. It is also a major manufacturing hub, and German companies are keen to tap into this market.

However, there are also some risks associated with investing in China. The Chinese government is increasingly assertive, and there is a risk that it could take actions that could harm foreign companies.

Despite these risks, German companies are continuing to invest in China. They believe that the potential rewards outweigh the risks.