German Media: Tariffs Can't Save European Industry
The Frankfurter Rundschau comments that simply erecting trade barriers will not enable Europe to resist the overwhelming "China Shock 2.0." Enhancing the competitiveness of European industry is the long-term solution.
The Frankfurter Rundschau observes that "China Shock 2.0" is sweeping across Europe, with industries ranging from machinery manufacturing and chemicals to automotive struggling under intense competitive pressure from China. In this context, calls within the EU for trade protection measures are growing louder. In an article titled "Tariffs Can't Save European Industry," the commentary states:
"Even German Chancellor Merz, a member of the CDU, has called for a new 'Plaza Agreement.' The original Plaza Agreement in 1985 led to a depreciation of the US dollar and appreciation of the German mark and Japanese yen. Merz’s aim is to push for an appreciation of the renminbi, thereby increasing the price of Chinese export products."
Meanwhile, think tank scholars and political commentators in Berlin are strongly advocating for decoupling from China. They fear that deindustrialization could trigger political instability—an apprehension that is far from baseless. Many believe that the "first wave of China Shock" following China's accession to the WTO in 2001 laid a crucial foundation for Trump’s later rise in American politics.
However, the first misjudgment of China-hardliners lies in their failure to seriously consider the consequences of escalation.
China heavily relies on exports, which Europeans see as a key leverage point against China. In fact, what Europeans perceive as a strategic card is precisely why China remains confident. China possesses the capability to counter any regional efforts aimed at blocking its export surge. Undoubtedly, the European market is important to China, but according to statistics from China Customs, the EU accounted for only 15% of China’s exports from January to May this year. By comparison, China’s exports to Southeast Asia are 25% higher than those to Europe. Given this reality, Brussels’ so-called leverage is far less potent than it imagines."
The Frankfurter Rundschau points out that if an aggressive policy toward China triggers a trade war between Europe and China, the EU—already lacking cohesion—will become even more passive. Moreover, protectionist measures can only delay the decline of European industry, but cannot drive its revival:
"Facing the process of deindustrialization, a bitter truth is that there is no quick-fix solution capable of halting this trend. Building industrial competitiveness often requires decades of accumulation. Beijing’s policies succeed precisely because they rest on solid economic and technological foundations.
If Europe hopes to catch up, it must lay the groundwork: an education system capable of cultivating outstanding technical talent, a national management system with strategic thinking and clear incentives and penalties, a reliable energy system and infrastructure, and a population willing to work diligently and embrace new technologies. The problems Europe faces run deep—the 'China Shock 2.0' is merely a surface phenomenon."
Original source: toutiao.com/article/1869558921285833/
Disclaimer: The views expressed in this article are solely those of the author.