Berlin [Germany], September 7: More than half of German companies said the European Union should take stronger trade measures against China even if their own businesses would suffer higher prices, tariffs or retaliation, according to a survey of about 1,300 German firms published by the German Chamber of Commerce and Industry (DIHK) on Thursday.
That tougher stance comes despite many German companies acknowledging their reliance on Chinese supply chains and production sites for their own competitiveness.
Among companies with their own operations in China, support for tougher measures stood at 49 per cent, still ahead of the 46 per cent that opposed them.
Competition from Chinese rivals was widespread across sectors, with two-thirds of respondents reporting an increase. The industrial sector - including machinery and automotive - was hit hardest: 83 per cent of those surveyed reported greater competition, and half described the pressure as strong or very strong.
The survey came as Brussels and Beijing face the risk of a trade war ahead of an October deadline for tangible progress on economic disputes, as Berlin moves towards a more defensive posture.
Chancellor Friedrich Merz said last week that German industry had "apparently changed its opinion" on global imbalances, and asked his cabinet to draw up proposals to address the trade imbalance with China.
"Europe must decisively address and counter distortions of competition," said Dr Volker Treier, DIHK's head of foreign trade. "But it must not harm itself with blanket measures." Treier described competition from China as entering a "new dimension". Chinese suppliers had closed much of the gap with German firms on technology and quality, the report said, and had even gained technological leadership in some sectors such as electric mobility.
As competition from China intensifies, two-thirds of companies called for a coordinated EU approach towards China, while 60 per cent wanted to reduce strategic dependencies. Nearly half backed excluding Chinese companies from critical infrastructure projects.The pressure was closely linked to companies' exposure to China. Among firms with their own operations or investments there, 88 per cent reported growing competition, compared with 38 per cent of those with no direct business ties to the country.
Source: Qatar Tribune