China ‘not playing by the rules’, German finance minister says
Sign up now: Get ST's newsletters delivered to your inbox
German Finance Minister Lars Klingbeil said Germany is “on the sidelines” with its calls for free trade even as Beijing bends the trade dynamic in its favour.
PHOTO: REUTERS
- German Finance Minister Lars Klingbeil accuses China of breaking global trade rules, citing overcapacity, state subsidies, and joint venture obligations.
- Germany plans to strengthen its industrial sectors like steel and automotive to protect jobs and compete with China.
- The German government supports a firmer stance on China, aligning with EU efforts to introduce new trade defence measures against China’s trade surplus.
AI generated
BITTERFELD-WOLFEN, Germany – German Finance Minister Lars Klingbeil accused China of flouting global trade rules and said the government in Berlin is likely to adopt a “firmer stance” in its engagement with the world’s second-largest economy.
Speaking at a campaign stop in eastern Germany, Klingbeil called for making industrial sectors such as steel and automotive more resilient to preserve jobs and fend off competition from China.
Germany is “on the sidelines” with its calls for free trade even as Beijing bends the trade dynamic in its favour, he said.
“They’re not playing by the rules,” Klingbeil, a co-leader of the Social Democrats and Germany’s vice chancellor, said in the eastern town of Bitterfeld-Wolfen on Aug 20.
“Overcapacity, state subsidies, joint venture obligations – all these things,” he added, accusing China. “We simply have to do more in this regard.”
Chancellor Friedrich Merz’s government has hardened its stance on China as European officials conclude that it risks losing economic ground if it doesn’t build greater resistance.
Authorities in Berlin have been working behind the scenes to identify Chinese vulnerabilities that can be exploited if the European Union finds itself in a trade war with China.
Klingbeil, who campaigned in the state of Saxony-Anhalt ahead of a Sept. 6 election that could see sweeping gains by the far right, addressed the dynamic to voters.
“That’s why I’m really in favour of us taking a firmer stance toward China,” Klingbeil said. “And I’m also grateful that the chancellor now sees it this way too – and will be advocating this position in the chancellery.”
EU leaders in June tasked the European Commission, which handles trade matters for the bloc, with presenting a slate of new trade defence measures to confront what they deem to be an unsustainable deficit with China that exceeds €1 billion (S$1.49 billion) a day.
Klingbeil has a track record of calling for a more muscular approach.
In February, while Merz sought engagement with a trip to China, Klingbeil said Germany mustn’t “slavishly maintain market openness” while others “outsmart us.”
He cited the example of Chinese production of cheaper green steel. BLOOMBERG
