Merz accuses China: “Undervalued currency creates unacceptable distortions”

At the summit, the chancellor said, “we talked about geoeconomic imbalances. We respect and recognize that, when there are countries that invest massively in research and development, that make technological progress, we accept that their productivity is higher than that of Europe”.

It is, he added, “one competition we facea challenge we have to live with. We must work to improve and become competitive again.”

But, continued Merz, “when we see high subsidies in sectors that saturate the markets, when we see that individual countries, which hold 13% or 14% of world demand and at the same time have 30% or 40% of world industrial production, which “subsidize overcapacity, and when all this is accompanied by a currency that is not freely convertiblewhich does not participate in the capital markets because they are isolated, then we are talking about distortions that are not acceptable.”

“We need to discuss this – he continued – I do this when I travel to countries with which we have trade relations and I expect this to be accepted. On the European and transatlantic side we have experience with exchange rate dialogue formats. These are positive experiences we have had. I think it is in our mutual interest to address this topic, because one currency kept artificially low it actually has an effect on purchasing power nationwide. This is a dialogue and a discussion that needs to take place: it is in our mutual interest,” he concluded.