- Interview: Ulrich Reichert of Wirtgen China on the construction industry
- Taiwan loses control of Omicron
- Covid infections on the rise in Beijing
- Ukraine demands help from China
- Chip shortage cripples e-bike production
- Tesla has to recall cars again
- Politburo announces stimulus package
- Stephen Roach sees China as growth risk
- Yu Jianhua to become new Party Secretary of customs administration
- So To Speak: ‘big white’
“If you want to get rich, build a road first.” (要想富先修路). This is an actual Chinese proverb. The country’s economic planners have amply taken this saying to heart. Over the past decade, they have built an average of around ten thousand kilometers of freeways per year. The impact on the infrastructure speaks for itself.
But demand for road construction is currently faltering – and at a time when growth is threatened from many sides. This is something Ulrich Reichert wondered about when he spoke to Frank Sieren. Reichert works for the Wirtgen Group, a major manufacturer of construction machinery. “Omicron is the biggest brake at the moment,” says Reichert. His Beijing plant has been closed since March. His clients, namely construction companies, have already begun to run out of money.
Normally, the government would now step in with contracts – but nothing substantial has happened so far, it has been surprisingly inactive. Reichert is now hoping that the leadership will pull the lever on economic stimulus after all. Sometimes that happens overnight in China. And then construction contracts start flowing again.
Political observers in Taiwan also wonder about puzzling inactivity – specifically in dealing with Covid. The behavior of Taiwan’s government currently resembles Germany’s chaotic pandemic response. In Taiwan, the number of infections has already increased noticeably, reports David Demes. But the Taiwanese government is not following its initial concept of proactive containment. In fact, it continues to lift measures, and a lockdown is considered unacceptable by Taipei.
Those who now want to draw hasty comparisons to the People’s Republic have to keep the quality of the vaccines used in mind. Taiwan mainly administered Moderna, BioNTech and AstraZeneca. A large part of the population is therefore sufficiently protected against severe cases.
Finn Mayer-Kuckuk
Interview
‘I hope that the Chinese government will not allow a major economic downturn’
Uli Reichert, 66, has spent his entire career building up Wirtgen’s business in China since the end of the 1980s. The Wirtgen Group is one of the leading manufacturers of road construction machinery. It generates around €3 billion of revenue. The company manufactures in Germany, Brazil, China and India. In 2017, US agricultural machinery manufacturer John Deere acquired the Wirtgen Group for €4.4 billion. In May, Reichert will step down from the post of China CEO to work as a consultant at the German headquarters for another two years.
Mr. Reichert, you first came to China in 1988 and have lived in Hong Kong and on the Chinese mainland for over 30 years. In the road construction machinery business, you experienced the great upswing, but also crises. How profound is the current crisis?
The first major crisis in the 1990s was the Asian crisis of 1997, following the return of the British crown colony of Hong Kong to China. It only had a marginal impact on China. SARS in 2002 did not have much of an impact on China or our business, especially in Hong Kong. When the global financial crisis hit in 2008, Beijing immediately launched a stimulus package of around $400 billion. No slump for our business. But when this package ended in 2012, we had a significant decline from 2011 to 2012. For the first time during my time in China. Now, on my home stretch, the second slump is imminent.
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