(Deutsche Welle Chinese website) "Frankfurter Allgemeine Zeitung" commented that instead of complaining about China's government subsidies and exchange rate advantages, Germany's top priority is to improve its competitiveness. This comment titled "Germany is Too Hypocritical" reads:
"Some people once praised this country and called it the world's export champion. Others criticized this country, believing that imports here are too little and the trade imbalance is too serious. In addition to weak domestic demand, the currency here is also undervalued, which also makes the country's exports cheaper abroad. Exports have brought huge gains to the country's automobile industry. benefits, and the government’s involvement in the automobile industry is significantly greater than that of other industries. Many of the country’s jobs are related to the automobile industry, which itself is not in line with the teachings of a market economy. As an economic power, this country has always ignored criticism from the outside world and responded confidently: Our cars are better than those of our competitors.
This story applies to Germany in the 2000s, and it also applies to the People's Republic of China in the 2020s. Precisely because of this, the completely different attitude shown by the German government is even more concerning. Ahead of last week's EU summit, the German and French governments jointly called on the European Commission to put aside free trade and use access to the EU's internal market as a geopolitical weapon. After all, the German auto industry is in dire straits right now, and the arrival of cheap Chinese electric cars is making it even worse. At a time when gasoline prices are high, Chinese electric vehicles have become popular among European consumers.
From the early days of mercantilism to today’s Trump, all opponents of free trade like to repeat this old refrain: Exporters win, importers lose. The only difference from the past is that this time Germany, which is on the other side of the trade imbalance, has also joined the chorus. For a long period of time, the German government has been promoting free trade, and the automobile industry has certainly contributed to this. After all, they are worried about the loss of the sales market. Now the tide has completely changed. The pro-employer German Economic Institute said that the trade deficit between Germany and China is likely to exceed 100 billion euros in 2026, and Germany's three major export pillars will bear the brunt: automobiles, electronics and machinery manufacturing. "
"Frankfurter Allgemeine Zeitung" commented that building trade barriers will not actually extend the life of related industries, but will deprive German consumers of their right to freely choose and obtain products with better cost performance:
"Of course, there is nothing wrong with the EU setting up countermeasures in order to be prepared for a trade war, such as in response to China's renewed restrictions on rare earth exports. The artificially low exchange rate has indeed brought benefits to China, and China should indeed increase domestic consumption. There is no doubt that it is. However, it seems a bit hypocritical for Germany to use this as an argument to demand the implementation of trade barriers.
Claims that competitors rely solely on government subsidies to survive are clearly out of date. In fact, the new Chinese companies that are impacting the world market are far less dependent on low-interest state loans than older companies. According to statistics from Chinese think tank CF40, the proportion of government subsidies in profits in new industries has dropped significantly. Perhaps it’s time for Europe to accept that a country that produces millions of engineers every year is bound to produce more innovative products. Why doesn’t Germany start by cultivating talents? "
“Rare earth self-sufficiency is just wishful thinking”
Western countries have realized their high dependence on China in the field of key raw materials such as rare earths. Since then, the United States, the United Kingdom and the European Union have successively launched their own rare earth strategies. However, the Neue Zürcher Zeitung commented that self-sufficiency is just a wishful fantasy:
“We have become dangerously dependent through no fault of our own. The West must change its thinking to attract investment: citizens must accept mining and smelting for rare earths, governments must cut red tape that hinders investment, and companies must be willing to pay higher prices for security of supply.
But even so, self-sufficiency can only be an illusion. A survey released by consulting firm Ernst & Young shows that decoupling from China before 2050 will cost a cumulative US$23 trillion. In contrast, achieving partial self-sufficiency is more important. The West, in particular, should improve its competitiveness. Only in this way can China become dependent on the West again. Interdependence is the best guarantee against conflict, both in the past and in the future. "
