Germany will urge the European Union to swiftly impose quotas on more categories of goods imported from China, mirroring a limit the bloc intends to set on hybrid vehicles.
Germany plans to pursue EU safeguard measures to restrict imports from more sectors, such as chemicals, mechanical engineering, and possibly pharmaceuticals, as per reports. Protective measures enable the EU to limit products from a sector when there is an increase in imports.
The German government will urge the European Commission, responsible for trade issues within the bloc, to produce proposals by year's end.
EU leaders are set to convene in Brussels on Thursday to address the bloc's significant trade deficit with China, which hit a record US$34.8 billion (RM142.05 billion) in September. They will explore strategies to prevent China from inundating the continent with subsidized, inexpensive products that undermine local industries — a movement that must extend well beyond the actions related to hybrids.
Discussions held last week between Beijing and Brussels culminated in a 16-point accord covering trade and investment, export regulations, and intellectual property rights. The EU announced it would impose a limit of 350,000 on the number of Chinese hybrid cars allowed into the bloc, benefiting the EU’s local automotive sector.
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Germany's drive for more stringent measures represents a significant change in the nation's stance towards China. Berlin has historically been more reserved due to its export-oriented economy and strong business connections with Beijing.
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Merz has charged China with maintaining an artificially weak yuan and remarked earlier this year that saying “we misjudged China’s influence and economic might.”
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Noah Barkin, a senior adviser at the US research consultancy Rhodium Group, stated that "the German shift on China has primarily been influenced by two factors: growing concerns within German industry, particularly among car manufacturers, and the developing agreement across Europe, spearheaded by Brussels and Paris, that more decisive measures are required. Nonetheless, the concern over possible Chinese retaliation persists.”