Germany Inc. and China Inc. have long been wrapped in the tightest of corporate embraces. But lately there have been increasing signs that the bonds of friendship—and profit—have started to chafe a bit.
The latest sign came last week, when The Wall Street Journal reported that the German government had declined to renew state-sponsored insurance covering losses related to political upheaval for Volkswagen ’s operations in China. Berlin cited concerns over human-rights violations in China’s Xinjiang region, where Volkswagen has a plant. Volkswagen says there is no forced labor at its factory and that it still sees China as the world’s key driver of economic growth.
