Merz on China: 'No trade war' – but Europe ready to defend against unfair practices
At the Berlin Global Dialogue, the chancellor accused Beijing of overcapacity, subsidies and an undervalued currency, calling for a 'new balance' in trade.
Archive image · Photo: Grunpfnul / Wikimedia Commons, CC BY-SA 4.0 (cropped and resized)
German Chancellor Friedrich Merz said on Wednesday he does not see a trade war between the European Union and China despite rising tensions. Europeans do face unfair practices, he told the Berlin Global Dialogue. "We are looking for peaceful solutions, but the basic requirement for that is fair trade," Merz said. He cited Chinese overcapacity, heavy subsidies in the auto sector and elsewhere, and an artificially undervalued currency.
The aim is a "new balance" in trade with China, which matters greatly to many German companies, he said. The EU does not necessarily want to use its toolbox: "However, we are ready to defend ourselves against unfair practices." Unlike the United States, where most Chinese firms are shut out, the EU is an open market and wants to remain one, Merz said.
Last week, EU leaders, pushed by Merz and French President Emmanuel Macron, asked the European Commission to develop new tools against trade imbalances that would let Brussels regulate market access for countries that seriously distort the single market. China responded cautiously. Two weeks ago, Beijing agreed to curb hybrid car exports to Europe; EU Trade Commissioner Maros Sefcovic said shipments could fall by more than half.