Strengthening Transregional Resilience and Sustainability: Compatibilities in Germany’s Indo-Pacific Guidelines and Taiwan’s New Southbound Policy

This article was originally published by Global Taiwan Institute in its weekly newsletter, The Global Taiwan Brief, Vol. 9, Issue 23. Used with permission. To get the Global Taiwan Brief in your inbox every week, subscribe at globaltaiwan.org/subscribe. Sandra Meerwein is a PhD candidate, lecturer and research assistant for Transnational American Studies at the Obama Institute for Transnational American Studies at Johannes Gutenberg University, Mainz. Her research focuses on maritime security and ocean governance in the Indo-Pacific at the intersection of geostrategic, economic, and socio-ecological concerns.

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Since the implementation of Germany’s Indo-Pacific Guidelines (hereafter “Guidelines”) in 2020, the Federal Government has increased its efforts to define the nation’s position in and toward the region more explicitly. Whereas this process is still a work in progress, the formulation of Germany’s Strategy on China and a National Security Strategy (NSS) in 2023 provided valuable insights into the position and direction Berlin is taking. As the Guidelinespoint out, the Indo-Pacific is a significant region for Germany’s economic interests, and the assurance of open maritime trade routes under principles of the rules-based international order is essential in order to guarantee the resilience of supply chains and stable trade relations with regional partners. The interests and goals of Berlin’s agenda thereby align with the European Union’s approaches to the region. Overall, Germany’s increasing attention toward the Indo-Pacific has created the potential for deepening economic and diplomatic relations with regional partners—while also raising questions about Berlin’s position and approaches toward regional challenges that impact its overall economic and strategic interests, like China’s rising assertiveness in the South China Sea.

In its orientation toward the Indo-Pacific, Taiwan and Germany’s economic and diplomatic ties have visibly deepened—mostly in the areas of people-to-people exchanges, as well as trade and investment. The potential for enhanced relations between Germany and Taiwan is evident in the many overlaps of the principles and interests defined in Germany’s Indo-Pacific Guidelines and Taiwan’s New Southbound Policy (NSP, 新南向政策). They indicate various opportunities for expanded cooperation and collaboration: specifically in the fields of trade and investment, research and development (R&D), technology, environmental concerns, and people-to-people exchanges. However, challenges to international law and order both in Europe and Asia, and uncertainty about Germany’s future regional responsibilities and capabilities—due both to the outcome of the US presidential elections, and Chancellor Scholz’s request for a confidence vote in late 2024—require nuanced and balanced approaches to the enhancement of Taiwan and Germany’s relations.

Germany’s Indo-Pacific Interests and the Enhancement of Relations with Taiwan

The principles and interests formulated in Germany’s Indo-Pacific Guidelines complement various points that are outlined in Taiwan’s NSP. Initiated under the first Tsai Administration in 2016, the NSP is an initiative to enhance relations with regional neighbors and under aspects of advanced collaboration and connectivity in the areas of trade, people-to-people exchanges, resource sharing, technology, and services. Similar to Germany’s Guidelines, theNSP thereby emphasizes the diversification and reliability of trade partnerships, stable and secure supply chains, investments in digital transformation and connectivity, as well as innovations of green technology. The overall high compatibility of their regional policies presents a valuable basis for the continuation and enhancement of relations between Taiwan and Germany.

Taiwan’s engagement with Germany, as well as the European Union (EU), has increased remarkably during recent years, especially in the economic sector of trade and investment. The interest in enhancing trade ties with Taiwan is also evident in advancing measures like the establishment of the EU-Taiwan Trade and Investment Dialogue, the first meeting of which was held in June 2022. According to the EU Directorate-General for Trade, the total trade in goods between Taiwan and the European Union reached a record in 2022 with €84.2 billion (approx. USD $88.5 billion). Moreover, Axel Limburg, chief representative and executive director of the German Trade Office in Taipei, has stated that Taiwan offers great opportunities of investment and innovation in its high-tech industries, especially under consideration of high quality and high legal protection.

The European Union, Germany, and Taiwan hold significant trade relations in the areas of high-tech goods such as semiconductors and electronic products, and cooperate in areas of green technologies and digitization. In this framework, investments and collaborations in areas of science and technology (S&T) research and development (R&D) play a critical role. The signing of the first Scientific and Technological Cooperation Arrangement (STA) between Taiwan’s National Science and Technology Council Minister Tsung-Tsong Wu (吳政忠) and Germany’s Federal Minister Bettina Stark-Watzinger on March 21, 2023, stressed mutual interest in advancing their cooperation in S&T—with a focus on semiconductors, hydrogen, batteries, and AI. In addition, in 2023 critical industries like Bosch, Taiwan Semiconductor Manufacturing Company (TSMC, 台灣半導體股份有限公司), Infineon, and NXP semiconductors announced their investment plans to build the joint venture “European Semiconductors Manufacturing Company (ESMC) GmbH” in Dresden. The €10billion (approx. USD $ 10.56 billion) project is backed with €5 billion (approx. USD $5.3 billion) aid by the German Federal Ministry for Economic Affairs and Climate Action—under the approval of the European Union, under the framework of the European Chips Act—officially started in August 2024, with prospects for beginning production in 2027. The project not only presents another significant step to deepen Taiwan and Germany’s ties in trade and scientific exchange, but also enhances strategic efforts to strengthen Europe’s resilience structure of supply chains and production, and to enhance access to critical technologies like semiconductors.

Regarding supply chain resilience and access to critical technologies, joint investments between Germany, Taiwan, and other European partners aligns with Berlin’s overall “de-risking” approach, in terms of strategic interests in both diplomacy and trade. The enhancement of trade relations with regional partners in the Asia-Pacific like Taiwan—including interregional trade agreements within the framework of EU and ASEAN relations—supports the Federal Government’s ambitions for greater economic diversification with the goal “to increase the resilience of Germany’s global supply chains and to […] strengthen sustainable local added value.” This approach is also reflected in Berlin’s 2023 NSS and Strategy on China, which emphasize the need to apply de-risking strategies in political, economic and social areas in contrast to any pursuits of economic decoupling. Part of such de-risking strategies include cybersecurity concerns and that “[c]ompanies and civil society must enhance their risk awareness, assume responsibility for their cybersecurity and build the necessary capabilities, also with a view to being properly prepared and able to help themselves.” In this regard, enhanced cooperation with Taipei concerning issues of media literacy is especially valuable due to Taiwan’s experiences in coping with dis- and misinformation strategies, particularly after successful deterrence measures by Taiwanese civil society organizations during the presidential election period in 2023.

Aside from high-tech investment and cybersecurity, there are further opportunities to strengthen economic, social, and cultural ties in the areas of infrastructure, communication, digitization, education, and tourism. Such fields have the potential to align with general aspects of sustainability and resilience, as outlined in both Germany’s Indo-Pacific Guidelinesand Taiwan’s NSP. Moreover, they create the potential for intersectional and collaborative R&D/S&T projects in, for example, sustainable urban planning and legal and ecological protective measures of marine ecosystems—especially among marine biodiversity research centers, such as Taipei’s Biodiversity Research Center (生物多樣性研究中心) or Germany’s Senckenberg Biodiversity and Climate Research Center.

Challenges: Uncertainties about Germany’s Future Regional Responsibilities in Europe and Asia

Despite the enhancement of economic, socio-cultural, and diplomatic ties between Germany, Taiwan, and the European Union, there are challenges that darken prospects of further cooperation. Developments in the war in Ukraine put growing pressure on Berlin to increase its commitment to regional security matters in accordance with other European partners and NATO. However, uncertainty about the United States’ future commitment to NATO and support of Ukraine after the outcome of the 2024 presidential elections, as well as the untimely election of a new German government after Chancelor Scholz’s request for a confidence vote in early November 2024, leave Germany in a current state of paralysis. These developments entail the risk of a temporary halt in Berlin’s growing attention toward Indo-Pacific affairs. Rising regional tensions due to the war in Ukraine generally force European countries to amplify their diplomatic and military focus on European and transatlantic issues. Consequently, this diminishes the capacities of European countries, including Germany, to counter security risks in the Indo-Pacific—such as those resulting from China’s rising assertiveness in the region through economic coercion, disinformation, grey-zone activities, and improving military capabilities.

Even though Berlin signaled stronger commitment in the Indo-Pacific in 2024 by deploying the German Air Force and Navy in the region to participate in multinational exercises in the Indo-Pacific that were meant to strengthen the rules-based international order, the current status of German military and defense capabilities are insufficient to cover an increasing involvement of Germany in security matters in both Europe and Asia. Although the 2024 Progress Report of the Federal Government’s Indo-Pacific Guidelines clearly states “that the status quo in the Taiwan Strait may only be changed by peaceful means and mutual consent [and] Germany is committed to de-escalation,” the question remains as to whether Germany has the means to contribute to an effective deterrence of China’s coercive actions in the East and South China Seas.

Conclusion

To strengthen their ties in alignment with each other’s regional policies, Germany and Taiwan should continue to focus on the advancement of trade investments and collaborative research projects in the fields of green technology, sustainable infrastructures, resilient and sustainable ocean economies, and educational exchanges. Such investments and collaborations have the high potential to attract further support by multinational organizations like the European Union in the framework of investment and funding projects such as the EU Global Gateway. This would also enhance both parties’ integration into international efforts to jointly promote sustainable and resilient structures of interregional trade and investment. In this framework, both Germany and Taiwan should continue their strategies of regional diversification by enhancing economic, diplomatic, and socio-cultural ties with Indo-Pacific partners, especially in Southeast Asia and with Pacific Island nations. Infrastructure projects, R&D collaborations in sustainable technologies and ecological resilience, contributions to policies of sustainable tourism, enhancing people-to-people exchanges, and multinational efforts to share green energy, all create further trust among partners.

At the same time, Germany has to tackle the issues of its lack of military capacities, and to consider more specifically how to react to challenges to the rules-based international order in both Europe and Asia. Whereas the direction of Berlin’s regional orientations and responsibilities are currently on halt due to uncertainty about the outcome of Germany’s upcoming elections in 2025 and unclear consequences of the 2024 US presidential elections, recent developments of its Indo-Pacific policies suggest continued efforts to commit to the region in strong alignment with the European Union’s interests. Taking into account the transregional impact of China’s increasing assertiveness and Russia’s aggressions, the new Federal Government of 2025 should continue to focus on joint policies in accordance with European and Indo-Pacific partners—like Taiwan, the United States, and Japan—that enhance trade and strengthen diplomatic and military involvement. By means of collective resilience, this direction bolsters the security of important trade and supply chain routes, enhances the potential for regional stability, and creates multilayered resilience in economic, geostrategic, and ecological structures of transregional connectivity.

The main point: Germany’s approach to the Indo-Pacific, as formulated in its 2020 Indo-Pacific Guidelines, is very compatible with Taiwan’s New Southbound Policy. This creates opportunities for enhancing relations between the two sides, and for advancing stable structures of transregional resilience and sustainability—specifically in the areas of trade, scientific research and development, and people-to-people exchanges. However, uncertainties about Germany’s future regional responsibilities, as affected by domestic politics as well as rising geopolitical competition in both Europe and Asia, could potentially impede approaches to enhanced cooperation between Berlin and Taipei.

(Featured photo by noelsch on Pixabay)