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Germany hopes that China will Import tariffs on electric vehicles And hopes talks in the coming weeks will be able to avoid an escalation of the trade conflict, a government spokesman said on Friday.
German Chancellor Olaf Scholz’s government is pushing for what it calls a “friendly” solution after the European Union threatened to impose tough anti-subsidy tariffs to protect European carmakers from competition.
As Europe’s largest economy, Germany’s voice is particularly important and its major automakers have strongly opposed EU tariffs, fearing retaliatory measures could hurt their business in the huge Chinese market.
“It would be highly desirable to reach an amicable solution, but it is clear that serious action is also needed from the Chinese side,” the spokesman told a regular news briefing.
A spokesman for the German Economy Ministry told the same news conference that the EU must find a solution that complies with World Trade Organization rules.
Economy Minister Robert Habeck will visit China next week. The economy ministry said Habeck will not be directly involved in tariff negotiations but will push for fairer trade conditions when he meets with Chinese officials.
Bloomberg News reported on Friday that Germany wants to prevent auto tariffs from taking effect, or at least ease them, but German officials have not confirmed this.
The European auto industry has warned against tariffs, with German carmakers most vulnerable to any retaliation as they get nearly a third of their sales from China by 2023, trade data showed.
Scholz’s spokesman told a news conference earlier this week that a friendly solution was preferable to further trade barriers.
“We need to promote global trade,” he said.
Threats of retaliation
In a sign of escalation, Chinese companies have formally applied for an anti-dumping investigation into pork imports from the European Union, according to the state-run Global Times.
China’s threat to take retaliatory measures against European Union pork has re-escalated tensions in one of the world’s most important trading relationships, but it may not seem too harsh to Berlin.
Chim Lee, senior China analyst at the Economist Intelligence Unit, said: “China’s investigation into EU pork can be interpreted as a special choice to avoid hurting Germany, which could help prevent or soften EU tariffs. Spain and France are major pork suppliers and they support the imposition of tariffs.”
Concerns about escalating trade tensions have swept Europe at a time when countries are still recovering from the economic shock of the coronavirus pandemic, rising inflation and interest rates, and an energy crisis following Russia’s 2022 invasion of Ukraine.
Germany has been walking a delicate line with Beijing, hoping to reduce its economy’s over-dependence on China on the one hand, while also hoping that its companies can gain more market access on the other.
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