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Scholz welcomes Chinese cars but urges 'fair' competition

April 15, 2024

While visiting Shanghai, German Chancellor Olaf Scholz has argued that the European market must be open to Chinese cars. However, he said that competition must be fair.

German Chancellor Olaf Scholz tours the Covestro center in Shanghai
In Shanghai, Scholz warned against dumping, overproduction and intellectual property infringementsImage: Michael Kappeler/dpa/picture alliance

German Chancellor Olaf Scholz in a visit to China on Monday said Chinese cars would be welcome on the market in Germany but warned against the use of unfair trade practices.

While Germany's economy has benefited from Chinese demand for products like cars to chemicals, ties have been strained with German companies arguing they face unjust market barriers in China.  

Only thing that ought to be clear is 'fair competition,' Scholz says

Scholz, who is in China on a three-day visit with several leading German executives, made the remarks while speaking at Tongji University in Shanghai.

He noted that, when Japanese and South Korean cars were launched onto the market in Europe, there had been fears that they would completely conquer the market in a one-way shift toward Asia.

"Nonsense!" said the chancellor. "There are Japanese cars now in Germany and German cars in Japan," he said. "And the same applies to China and Germany."

China: Germany's rival and partner

"At some point, there will also be Chinese cars in Germany and Europe. The only thing that must always be clear is that competition must be fair. In other words, that there is no dumping, that there is no overproduction, that copyrights are not infringed," Scholz said.

Bullying smaller neighbors is wrong, Scholz says, without naming Taiwan 

Sholz added small countries should not have to fear larger ones. However, he didn't mention China or Taiwan by name. China claims Taiwan as part of its territory and has not ruled out annexing it by force if it deems it necessary.  

The world works when we all have a few principles in common," Scholz said. "One of these principles is that we should not be afraid of our neighbors. We want that in our own lives."

"If our neighbor is a big, strong, muscular person, then we always want to say hello and be sure that he will never hurt us," he told Shanghai university students.

The same, he said, was true between nations and that countries "should not have to be afraid of one another at all." "Borders must not be moved by force become. That's the central point."

What else is on the agenda?

In Shanghai, Scholz is also due to visit an innovation center of German plastics manufacturer Covestro. Later on Monday, the chancellor is set to dine with the Party Secretary of Shanghai, Chen Jining.

The second stop on the chancellor's three-day visit, Shanghai, comes after a first day in Chongqing, in the country's southwest. On Tuesday, he will head to Beijing for talks with Chinese President Xi Jinping and Premier Li Qiang.

Scholz's visit comes while the European Union ponders punitive tariffs to protect the bloc's manufacturers from more affordable imported Chinese electric cars.

The chancellor is being accompanied by a dozen chief executives, among them the bosses of German vehicle manufacturers Mercedes-Benz and BMW, as well as the chemical company BASF. Volkswagen, Europe's largest car manufacturer, is absent from the trip.

rc,jsi/rm (dpa, Reuters)

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